Budget-writing panel meets Thursday on $150 million compromise bond package

By Scott Thistle, Sun Journal
Posted Aug. 19, 2013, at 1:37 p.m.

AUGUSTA, Maine — Lawmakers on the Legislature’s budget-writing Appropriations and Financial Affairs Committee will convene Thursday to start their work on a $150 million state borrowing package.

Republican Gov. Paul LePage and leaders in the Democratic majority reached a tentative deal late Friday on a bonding package they hope to send out for voter approval in November.

On Monday, Peter Steele, LePage’s communications director, said the governor would call lawmakers back for a one-day special session thereafter.

Ericka Dodge, a spokeswoman for Senate President, Justin Alfond, D-Portland, said lawmakers on the budget-writing panel would begin meeting on the proposal Thursday in Augusta.

The deal agreed to by LePage, Alfond, House Speaker, Mark Eves, D-North Berwick, Senate Minority Leader Mike Thibodeau, R-Winterport and House Minority Leader Kenneth Fredette, R-Newport, focuses on statewide infrastructure improvements for roads, bridges, state universities and colleges as well as funding to renovate Maine’s military armories.

“We put our differences aside and worked on a deal that will put more money into our economy, help our workforce and create jobs,” Eves said in a prepared statement Monday. “This bond proposal will inject critically needed funds into Maine’s roads, bridges and ports, and into upgrades at the state’s higher education facilities and armories.”

LePage had been urging lawmakers to put the borrowing package before voters this fall so funding would be available for the start of the 2014 construction season.

Originally Democrats wanted to take up the bonding package in September, along with several Senate confirmation hearings. But that could have delayed a statewide vote on the borrowing package until June of 2014.

The proposed bond package includes $76 million for highways and bridges, $24 million for multimodal improvements, $15.5 million for the University of Maine System, $15.5 million for the Community College System, $4.5 million for Maine Maritime Academy and $14 million for Maine Armory maintenance and renovation.

Democrats also announced last week they had a tentative agreement with LePage to take up another borrowing package in January that would focus on grants for research and development among other things.

Rep. Peggy Rotundo, D-Lewiston, the House chairwoman of the Appropriations Committee, said last week Democrats have always supported investment road and bridge renovation but had an earlier deal with Republicans in the Legislature’s minority to wait until January to address state-backed borrowing.

Rotundo said it was critical for the state to invest in keeping up its physical assets.

“We have about $1 billion worth of assets,” Rotundo said after an announcement Thursday by U.S. Rep. Mike Michaud, D-Maine, that he would seek the governor’s office in 2014. “It’s like owning a house and if you roof is leaking you can put off taking care of it but it’s going to cost more in the long run. To take care of it now when you can borrow money at a low interest rate — a very low interest rate — and fix it now, makes so much more sense than putting it off and having to pay twice as much for it later on.”

There was some back-and-forth between LePage and the committee last week after he ordered his Cabinet not to appear before the committee on the issue.

Rotundo said LePage’s deputy chief of staff had been copied on requests to various state department heads to appear and the governor’s insistence he approve those appearances ahead of time was a new policy from the governor’s office.

She also criticized LePage for not releasing sooner about $104 million in bonds already approved by voters for infrastructure improvements.

“Here he’s been sitting on these bonds for years,” Rotundo said. “As Democrats have tried to release them to create jobs and create economic growth in the state and all of a sudden he’s coming to this as though he’s just realized how important bonding is to the state when we’ve been saying for three years.”

She said LePage was trying to create the impression the Democratic majority didn’t care about making transportation infrastructure investments.

“It’s just the opposite,” Rotundo said. She also noted that because LePage withheld the bonds in 2013, the state’s borrowing capacity would be larger in 2014 without a significant change to the amount of debt service the state will have to pay — as existing debt will be retired this year as well.

“That’s a really important point,” Rotundo said.

LePage said he withheld the previously approved bonds until lawmakers passed a bill that would pay off the state’s nearly $500 million back debt to hospitals for MaineCare services they’ve provided.

LePage said the state could not afford to borrow more until a plan for paying the hospital debt was in place.

To go to the voters, a bonding bill will require two-thirds support in the Legislature.

http://bangordailynews.com/2013/08/19/politics/maine-legislatures-budget-writing-panel-meets-thursday-on-compromise-bond-package/ printed on July 24, 2014