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AUGUSTA, Maine — Health and social services officials told Maine lawmakers on Friday that the coronavirus has caused urgent financial problems as they asked for a share of roughly $1 billion in federal stimulus money to recover from the pandemic.
A $2.2 trillion stimulus bill passed by Congress in March gave Maine $1.25 billion for the virus response. The state has committed only $411 million of it so far, with the biggest $270 million chunk going to backfill an unemployment insurance system exhausted by the pandemic.
While Maine has lagged behind neighboring states in allocating that money, it has slated millions for health, child care, education and other areas through different grants. The stimulus money can only be used to address issues relating directly to the outbreak and not to offset the massive revenue shortages that the state and municipalities are experiencing.
The administration of Gov. Janet Mills has asked lawmakers for input on how to allocate the money as industry groups, nonprofits and agencies hammered by the virus have begun to lobby for shares. The Legislature’s budget panel met on Friday for updates from state budget officials and presentations from health and social services agencies.
The consistent message was that the virus has exacerbated long-term funding problems as they called for stimulus money and more ongoing state support for their sectors.
Art Blank, CEO of Mount Desert Island Hospital in Bar Harbor, said Maine hospitals lost an estimated $600 million in revenue after many procedures were delayed. Dr. Jeff Walawender, executive director of the Medicaid provider Community Dental, said lower reimbursement rates relative to neighboring states could hit practices hard as they attempt to recover.
Jennifer Putnam, the executive director of the Sanford disability services provider Waban, said its workforce is “at a breaking point” with few applicants for low-wage jobs in risky congregate settings. Jess Maurer, executive director of the Maine Council on Aging, said direct care workers with children have had to take leave and volunteers for meal programs have declined.
“Please don’t just thank us for our hard work and then go back to the way things were, taking things for granted, taking shelters for granted,” said Mark Swann, the executive director of Preble Street. “We need sustained state support to do this work.”
Some of those agencies have joined specific calls for funding. The private sector is also looking for aid as well. Tourism groups have asked for an $800 million bailout from the state largely in grants for fixed costs including rent, mortgage and sanitation and protective equipment.
More federal money could also be on the way. Mills has asked for more and members of Maine’s congressional delegation have backed different plans to provide state and local aid, but there is no consensus yet between the Democratic-led House and the Republican-led Senate.
While Congress has contemplated providing more funding to state and local governments or making funding more flexible, it has not yet materialized. States are facing increasing pressure as the federal $600 weekly enhanced unemployment benefit is set to end on July 31.
Maine is among the 35 states that tax benefits, so that program is now helping to boost state coffers. Income tax withholding is $2.5 million over state projections through the fiscal year so far, according to Michael Allen, Maine’s associate commissioner for tax policy, who attributed that largely to federal stimulus provisions at the Friday hearing.
The state, however, is projecting a revenue shortfall of roughly $525 billion by mid-2021, a staggering figure that is nonetheless far smaller than one from Moody’s Analytics finding Maine could lose up to $1.2 billion over the same timeframe. Allen revised a projected $200 million shortfall by June 30 downward to roughly $150 million on Friday.