AUGUSTA, Maine — State employees said Monday that Gov. John Baldacci’s proposal to shut down government for a dozen days, eliminate merit pay increases and increase health insurance costs will disproportionately hurt new hires and lower-income workers.
Education advocates, meanwhile, urged state lawmakers to preserve funding for doctor training in Maine and a proposed center in Waterville for children from low-income families despite the state’s growing budget shortfall.
Overall, Monday’s public hearing on Baldacci’s plan to close an additional $570 million budget gap drew smaller than expected crowds.
The budget-cutting proposal, unveiled last Friday, includes 12 days of government shutdown, cuts $70 million in school aid and eliminates or suspends potential tax breaks for businesses or individuals. The governor also has proposed drawing down more than $115 million from the state’s reserves and slashing more than $35 million from health and human services programs.
Tim Belcher, executive director of the Maine State Employees Association SEIU Local 1989, credited the governor for attempting to reduce spending so much without resorting to additional layoffs. The governor’s budget proposal for the coming biennium, as originally proposed, would have eliminated more than 200 state positions.
Belcher said the vast majority of state employees would rather have to stay home without pay one day a month than see additional layoffs. But Belcher and other union members said the cumulative impact of the cuts will be significant for many employees.
For instance, a newly hired office assistant will lose roughly $3,600 after two years if merit pay increases are eliminated, according to union calculations presented to lawmakers.
Factor in the $2,000 in lost wages from two dozen shutdown days and $2,500 in new employee cost-sharing on health insurance and it adds up to a more than an 18 percent loss of income for that worker, according to the union’s analysis.
“These cuts have a tendency to affect those who are least able to afford them,” said Scott Neumeyer, a Department of Labor employee whose wife, Jennifer, also works for the state.
Steven Keaten, a 25-year veteran employee with the state, said the state keeps coming back for more from its employees. Keaten pointed out that state employees have gone without cost-of-living increases during eight of the past 18 years, including three years under Baldacci.
“It’s happening every two or three years,” he told committee members. “It’s terrible what you people do to us and think that we can live with.”
The governor’s proposal to reduce state aid to schools by approximately $68 million drew scant attention, much to the surprise of several committee lawmakers. Instead, the committee heard detailed testimony in support of funding for several programs.
Baldacci’s proposal to earmark $2 million in one-time stimulus money to construct an education-related center in Waterville has raised some eyebrows among legislators. The new Educare center would be a pilot program that would offer early learning programs for children from low-income families while helping train students and caregivers in the latest programs.
But lawmakers have expressed serious reservations about the timing of the new center.
“This is a new program and we are all struggling to find ways to deal with all of the cuts we are having to make in existing programs,” said Sen. Bill Diamond, a Windham Democrat and committee co-chairman.
But Karen Baldacci, the governor’s wife, told the committee that $6 million already has been raised from private sources to build the $9.4 million center. Baldacci, who has been heavily involved in bringing New England’s first Educare center to Maine, said the project is a perfect candidate for federal stimulus money.
“We have an opportunity, even during these very challenging economic times, to make investments in partnership with the private sector in a program that will benefit all of the children of Maine,” she said.
The committee also heard testimony in support of the governor’s proposals to fund scholarships for medical students who want to work and stay in Maine as well as the Maine Graduate School of Biomedical Sciences, a partnership of universities and private research labs.
The Appropriations Committee will continue discussing the budget today and throughout the week as they work to develop a two-year spending plan. Lawmakers are under the gun to pass a budget by the middle of the month or else run out of MaineCare funding.
Rep. Emily Cain, an Orono Democrat and committee co-chair, said lawmakers are bound to make numerous changes to the governor’s budget. One area that Cain said the committee would likely look at further, after Monday’s hearing, was how to make sure recent hires in state government and lower-wage workers are not disproportionately affected by the cuts.