After months of budget cutting, Gov. John Baldacci’s spending blueprint for the next two years is almost anticlimactic. Rather than broad proposals to reshape state government or a necessary reordering of state spending priorities, it, in the parlance of the past few months, spreads the pain.
The spending reductions are necessary because the national recession has severely reduced revenues in nearly every state in the country, not because Maine government is bloated or wasteful. The challenge for Gov. Baldacci and the Legislature, which will begin work on the biennial budget after completing a supplemental budget for the current year that must reduce spending by $140 million, is to decide which state government services are most important and align state spending with those priorities.
The budget blueprint, outlined Friday, is a first step in the process. As such, reducing state employment — especially when that work can be done less expensively by others — while pursuing consolidation of state agencies as well as state, municipal and county government services is a good start.
At the same time, the budget’s proposal to essentially flat-fund K-12 education raises the question whether this simply passes a tax increase on to local property taxpayers. This outcome could be averted if local school boards minimize or eliminate spending increases, which they are supposed to do under the spending caps that were passed by voters as part of LD 1, which also called for state funding of K-12 education to reach 55 percent.
The governor’s budget also moves toward aligning spending with priorities by tying fee increases to jobs. For example, hunting and fishing licenses and marine resources license fees will increase so that warden and Marine Patrol jobs are not eliminated and the state’s shellfish monitoring program is maintained.
The governor proposes 10 percent reductions in the Business Equipment Tax Reimbursement program, the Circuit Breaker program and municipal revenue sharing. The question for lawmakers is whether small reductions in these programs are better than eliminating other programs and services.
The budget takes a risk by assuming that Maine will receive $99 million from the federal government for Medicaid. If that money is not forthcoming, harmful cuts to this safety net program will have to be made in coming months.
Gov. Baldacci deserves credit for being the first chief executive in decades to actually reduce state spending. His proposed budget for fiscal years 2010 and 2011 totals $6.1 billion. The 2008-09 budget was $6.3 billion. If spending kept pace with the average increases in recent years, the next bien-nial budget would have totaled $6.8 billion. He will also reduce the number of state employees — 139 layoffs are part of his plan — to the lowest level since 1983. Some state employees are also asked to begin contributing toward their health insurance, which begins to bring them in line with private-sector employees.
Gov. Baldacci is also right to balance the books without a general tax increase at a time when consumer spending is plummeting, worsening an already bad economic cycle. He did balance the 2010-11 budget with some fee increases.
Interest groups will find fault with different aspects of the budget, setting up a healthy discussion that should focus on Maine’s priorities for its smaller, more efficient government.