AUGUSTA, Maine — With state revenues $26 million below estimates four months into the budget year, there is a growing concern among forecasters that revenues will have to be re-projected downward next month, making the overall budget shortfall all the more difficult to address.
“We have now seen some of the larger revenue lines below estimates for [at least] three months,” said Rep. Pat Flood, R-Winthrop, co-chairman of the Legislature’s budget-writing Appropriations Committee. “We have to be concerned that that is a trend.”
He said the sales tax was down in October and has been below estimates by more than $13 million so far this budget year. He said the sales tax has been a reflection of how Mainers believe the economy is doing, although he said auto sales continue to be up from a year ago.
“It’s really a mixed revenue report,” Flood said.
Finance Commissioner Sawin Millett said after four months of the budget year, he is concerned about the sales tax, as well as the corporate income tax, which was down $1.3 million in October and is nearly $14.5 million below estimates for the four-month period.
“We may well see revenues re-projected by the revenue forecasting committee when they meet,” he said. “That will make it all the more difficult to put together a supplemental budget for the current 2013 budget year.”
Millett said the mixed report of the Consensus Economic Forecasting Commission will affect the revenue forecast. Jim Clair, commission chairman, said the panel adjusted its forecast to reflect the actual numbers this year, and that nearly 7,000 new jobs had been added in the state from July 2011 to July 2012.
He said the increased number of jobs indicates the economy is growing slightly better in the current budget year than projected, but the panel does not see any major increase in growth during the next few years.
“We either kept our estimates as they were from last February or reduced them slightly,” Clair said. “We don’t see the economy really moving until after all of this uncertainty in Washington is resolved.”
The panel made the assumption that Congress will avoid the “fiscal cliff” by continuing at least some of the current tax rates and make “selective” cuts in federal spending. Clair said if that does not happen, the nation likely will fall back into recession, and Maine’s economy will suffer.
“We will be facing a very difficult situation if Congress does not act,” said Rep. Peggy Rotundo, D-Lewiston, lead Democrat on the Appropriations Committee. “It will be difficult even if they do act because of the budget issues, and now revenue issues, we have in the state.”
Millett agreed and said he expects some significant additional budgetary needs at the Department of Health and Human Services. He said even if Congress addresses the budget and tax issues nationally, Maine will face some difficult budget decisions.
“There are always supplemental budget needs every year that have to be addressed, but less revenue and greater demands will pose some serious budget issues,” he said.
Complicating the situation is that the solution to the federal budget issues could affect the states in different ways. Tax Policy Associate Commissioner Mike Allen said the state could see wealthy taxpayers shifting their individual tax burdens between years.
“If Congress allows those higher tax rates for upper-income earners to take effect, some may choose to shift income into this year with [its] lower tax rates,” he said.
Allen said that may solve the state’s revenue problem in the current year, but shift the need to the two-year budget that lawmakers will consider in the new session in January.
“And we will have to analyze whatever other tax changes they make and spending decisions to see what impact they have on state revenues,” he said.
Rotundo said the new Legislature will face a lot of decisions based on what Congress does, in addition to dealing with state spending issues.
“These are going to be very difficult budgets we have to put together,” she said.
Millett agreed. He said the proposed two-year budget will go to the Legislature in early January, and a proposed supplemental budget will follow quickly. He said if Congress delays action or only passes stopgap measures, the state will be forced to delay final spending decisions until Congress acts.
It won’t get any better with who will be in charge in both houses of the legislature.
Certainly can’t get any worse after who HAS been in charge.
If anyone has been paying attention, it has got better under LePage and the Republicans, but don’t let facts confuse you.
site ANY thing that has ‘gotten better “.It’s just in your imagination.
http://www.usdebtclock.org/state-debt-clocks/state-of-maine-debt-clock.html
really? how??
Back to the likes of Violette, Martin, and McCormick. Graft, corruption, and ineptitude.
and the R’s were better???
…..
Maybe LePage should give another tax break to the rich and go ahead with removing the corporate tax. See where that leaves the revenues.
Maybe the Democrats can get another grant for a mural, or maybe a new painting.
It would certainly create more jobs than LePage has at least.
And increase the Federal Deficit even more as Obama will do the next 4 years, I am sure.
Crybaby pee-pants
Maybe the Govenor and his buddies need to start selling pencils on the street corners…
Perhaps if LePagespent more time on job creation, or letting the bonds on our bond packages out,
we might have seen more jobs, thus more tax revenue.He’d much rather kick thosedown the road when the interest rates are higher and the cost of fixing the things
the bond packages were supposed to aid just to prove a point.He has the powerto do those things, to **** with the wishes of the people he was elected to
serve.
bonds also cost money, how much further do liberals want to go into debt? You can not spend more than you take in? WIth bond packages, he is following the law. I am not sure who voted that in, but their is a 5 year rule as part of that law. Look at the gas tax that is suppose to take care of the roads and bridges. Whether Repubublican or Democrat, you still can’t spend beyound your means. Now they say their is what, a 20 milliion dollar shortfall in revenues? How do you expect to make that up? This is not just a party problem. Though it is up to both parties to fix it, they both made the mess.
How do you explain the 40 Million dollar revenue short fall in Massachusetts last month. The Democrats their control all the tax increases top to bottom. It is not just a local issue here. Blame LePage or whomever.
Our wages and our standard of living are in a race to the bottom. Why should anyone be surprised that tax revenue is shrinking too. Big surprise. When no one is working or if they are working, it is for minimum wage, they are not paying taxes. Get on over to Walmart and buy some more Chinese crap. Help step on the gas in our race to the bottom.
I don’t need to do that. I can buy a lot of the same Chinese crap at locally owned stores. I get to pay a higher price that way and my neighbor gets to keep working there for $7.50 an hour. The store owner has a car that is worth at least 20 times the car I have. I’m so glad to help!
Seriously, it’s the folks in DC that are ruining it for all the states. If we had proper import tariffs on these foreign goods, we could be thanking the people who buy them.
Agreed. America was a much better place to live when we were an exporting nation instead of an importing one. The top 1% are the only ones making out on “free” trade by moving their factories from America to Communist China. Their wealth has exploded in the last 20 years while everyone else’s has headed for the toilet. Their willingness to put profits in front of patriotism is disgusting, at best. The sad fact is though, they could not make a plug nickel off of it without a lot of help from the consumer’s lack of patriotism at the cash register. Every time someone walks out of a big box store, or a small business, with another load of cheap Chinese crap we are telling them that they made the right decision when they decided to pack up and leave America with their factories. Merry Chinese Christmas.
“the consumer’s lack of patriotism at the cash register”????
Nope and double nope. It’s up to the federal government to regulate trade and impose appropriate tariffs on imports. The percentage of consumers who can afford to voluntarily pay higher prices is going down. What you’re asking them to do would be equivalent to a voluntary charitable donation or tax. Sorry, but my cupboard is bare like Mother Hubbard’s. The U.S. manufacturers are facing unfair competition from imports and I can’t afford to help subsidize them. Sorry.
Besides that, I would have to do without things like a cell phone, computer or television in order to pass your “patriotism” test. I can’t find any of those products that are made here. Maybe final assembly and packaging is done here but I don’t count that as a made in U.S.A. product.
people can not afford to buy American made because they are so expensive because of the Unions.
People can not afford to NOT buy American. Not for much longer, at least. allusaclothing.com. Certified union made right here in America. Their prices are competitive with the “imported” crap at L.L. Bean. My girlfriend and I have four kids and five grand kids. We are doing 100% of our Christmas shopping online this year with companies that only sell certified American made products. No herding over to the big boxes with the rest of the sheep. No standing in line. Not one nickel sent to communist China. Our trade deficit with The People’s Republic of China last year was $350 billion, or $350,000 million. In 1985, when famed commie hater Ronald Reagan was president, our trade deficit with communist China was $6 million. See if you can figure out that percentage of increase without catching your abacus on fire! lol. Buy American, or learn to speak Chinese. Those are our choices.
Thats the dumbest thing I ever heard
That’s so wrong. A lot of non-union low-paying jobs have been lost because of the trade agreements. In many cases a U.S. manufacturer paying minimum wage can’t compete against the imports. Republicans and Democrats alike have been doing this to us for years. They pass it and the president signs it. Seems like any legislation that betrays the American worker is the easiest thing to push through.
Ponder this. Glenn Beck sells blue jeans for $130 a pair. He makes a very patriotic pitch for buying these American-made jeans. I can buy Wranglers, made in Mexico, I think, at Walmart for $16. So if I buy two pairs, I have nearly $100 to spend somewhere. Maybe it goes to eating in a local restaurant. Maybe I buy gasoline. Or maybe I can save it in my local bank where it becomes available for someone else to borrow for a house or as a business loan. That extra $100 didn’t just disappear. And I have more than just a pair of blue jeans. It seems a little complicated.
Those of us who actually work for a living, get what the rest of you voted for. Pols are all the same, but there is such a thing as the lesser of two evils. Demos are not it. Although thoroughly disgusted w/the lack of intelligence by the D’s & their sheepy followers, I’m not surprised.
Hate to tell you this, but the jokes on you and the lies and misinformation you are allowing yourself to be spoonfed by the Kochs and the Murdochs of this world.
You can only give out so many handouts….. Money has to come from somewhere.
Its always the handouts that take all the money. Its never irresponsible spending, politicians using tax money to redo their offices, etc etc etc.
Curse those poor people…they are the ONLY reason were in the red after all.
Its both…….
Those incompetent and criminal Dems have been stealing from you for 35 years. Paul Violette, John Martin and Dale McCormick are poster children of the Dems rule in Maine.
GOP tax cuts for the wealthy = GOP hand-outs.
Yessah
I was waiting for that, hope you had a great Thanksgiving….
Not taking peoples money is not a cut.. The Government has overstepped their bounds with their taking of peoples money.
blah blah blah —taxes are the cost of freedom. Don’t like it ? Go eleswhere. Good luck finding ANY civilized society that doesn’t tax people.
yup it comes for revenue which is why we should be giving it away thru tax cuts.
We need to tighten up all away around….. I would love to see a flat tax, EVERYone pays , bottom line.
that hurts the poor the most
And this tax system doesn’t?
7,000 new jobs? Where, when , what companies? You can bet that is a lie. What about the tens of thousands of layoffs, firings, business closings, businesses moving out of state , consolidations and bankruptcies. No matter, the budget is in the red, always in the red. Let us not forget the Maine Slave Wages the so called Walmart wage that qualifies you for food stamps, welfare and medicaid. Maine is finished.
seems like they hit the red button to move all the sacrificial lambs to the chicken little side, then, right before the auditors show up they somehow find some money laying around due to computer errors…..
Figures don’t lie but liars figure….
As someone else said, maybe these people are also so removed from the real world in Maine–how do you make a living here and don’t even think about having your own business–gee, cut off their legs and then wonder why they can’t run?
With all the upper income earner tax breaks and big company breaks the burden will shift down to the working middle class.how much longer can we support all the govs and lawmakers perks and pay raises.The big cuts should be on their generous perks and pay.They have the best part time job of anyone
Thank the Maine Dems. They ruled Maine for 35 years and created all of these perks. That’s why we’re paying that Fem crook Violette $60,000 per year for the rest of his life. Thanks Maine Dems.
The D.O.C. is spending thousands on smoking supply’s for the state inmates. The commissioner says it’s legal on the outside so the inmates should be able to do it on the inside. D.H.H.S. case workers received pay raises this year. The commissioner says this will prevent job burn out. D.O.T. contracts out all the road work now but still maintains all the equipment and staff to operate said equipment. Also, look at all the state vehicles parked in employee’s driveways. Why do the taxpayers allow the governor to live in such luxury when us peasants can’t afford to make ends meet? This is just the tip of the iceberg. It’s time to start demanding more from our elected officials.
Point to ONE shred of evidence that DOC is funding prisoner smoking, and that a lot of state employees park their car in their driveway. Are you stalking state employees?
Chadwick Curtis, Acting Director
1202 Dover Road
Charleston, ME 04422
(207) 285-0800
D.O.C. has a new policy that is now in effect allowing inmates to smoke. The D.O.C. just spent $900 for 4 ashtrays for one facility. Now they have to purchase and install electronic lighters at a cost of $600 each. Not to mention the smoking huts that were built at a cost of over $1500 each. As for state vehicles being taken home at night it’s hard to miss the D.O.T. trucks sitting in peoples yards.
“The D.O.C. is spending thousands on smoking supply’s for the state inmates.” certainly deceptive at best..
Please call the number above. There is nothing deceptive in my comment. I point you in the right direction but still you would rather call someone a liar rather than see for yourself. Pretty foolish if you ask me.
Ignorant is a better word….
Deceptive?? I think not.
Good work LePage! Maybe you’ll figure it out in the next 2 years…
Gee. With all of his so-called “business acumen” from running a 2-bit junk store chain you think LePage would be able to balance the state’s budget without continually having to go back and fix these “little” mistakes after 2 years and with majorities in both houses.
Turns out actually paying the bills, unlike the failed Baldacci regime, causes budget fluctuations. The Dems would just stiff someone, like the Maine hospitals, and say problem solved.
Put us back to work. Then we wont be in the red.
Math is hard for Teabillies !
With Obummercare staring us right in the face, you can bet Maine is not the only state to run a deficit. Send the credit card bill to Pelosi, I bet her credit cards are paid off monthly.
How can Obamacare create state deficits when Obamacare pays for setting up health insurance exchanges and 100% of Medicaid for the first few years?
I know!
It can’t
Try again.
Yessah
‘Cause the Feds won’t fund it at 100% for long but will require the State to continue to offer the insurance in perpetuity. Also, you can bet your brie and Merlot (you liberals all drink a lot of wine and are partial to soft cheese, right) that these gov’ment insurance programs will shortchange healthcare providers so the deficit will be passed on to those of us still working and buying insurance for our employees. Will do it. Try again. Yyyyeeeesssaaaahhhhhh!
Yeah – after that they pay only 90%.
Try again.
Yessah
O.K., I will. The state will have to pay 10% of the cost. That costs money. The amount that Medicaid will pay doesn’t cover the whole cost of providing the services provided so the resulting shortfall will be passed on by doctors and hospitals to be paid by those of us doing the right thing by providing health insurance to our employees. I am sorry if you can not see that you have just disproved your own argument that this expansion of benefits will not increase deficits, both our states and our employers.
I see people here paying the blame game. Let’s just say that maybe if the country were headed in a different direction that our revenues would probably follow. That being said. Now instead of complaining here go to your elected officials office and complain. They have set the tone for the economic condition of this country not Lepage and or just the democrats. It is all 535 of those fools in Washington DC. The number one guy is at the helm of it all for not submitting a budget in his last four years. I would like to see you and i do this and be able to survive. Wages are down 4.3% and there is no light at the end of the tunnel. So you see what happens in Washington does have an impact at the state and local level. A person could go on and on but why?
We can thank George W. Bush and GOP trickle-down nonsense for crashing the economy, and the GOP clown squad for making the defeat of Obama – and not jobs – their primary objective over the last 4 years.
They failed at defeating Obama and failed the American people.
They can now shut up and get out of the way.
Yessah
Yep, it is the tax break that are causing no one working. It has nothing to do with anyone with half a business brain not willing to commit to expanding or hiring because they have no clue as to what it is going to cost them with obamacare and new regulations by this economy killing administration in DC. Maine is no different than most of these other states. Lowering tax rates for ANYONE has nothing to do with jobs. But it sure has the welfare crowd wondering about who they are going to take money from now.
Authentic Frontier Gibberish.
Yessah
Gee – republicans cut taxes for wealthy people that don’t need it – and revenues fall
Who knew?
Why haven’t the so-called “job creators” created all those jobs they were supposed to create.
Republicans wouldn’t lie to us would they?
Would they?
Yes they would.
Repeal the stupid GOP tax cuts for the wealthiest Mainers.
Yessah
Wrong again, moonglow. If you bothered to read the article, and I bet you didn’t; you would have seen that the biggest part of the revenue shortfall is from the state sales tax (not lowered since the budget was constructed) and the corporate income tax (ditto). Hate to confound you with the facts. but the state’s economy is in the crapper for a number of reasons, but most certainly not because our tax rates are too low! Raising taxes on the wealthy (which I dare you to define just who you consider to be wealthy) just won’t bring in enough revenue to pay for our totally out of control spending. It would make you liberals feel good though. And to liberals, feeling good about ourselves is more important than being responsible YYYYEEEEESSSSSAAAAHHHHH!!!!!
Yeah – LePage’s solution is to eliminate corporate taxes.
>$250,000
raise their taxes.
Only a republican would call school funding “out of control” spending.
Yesah
Sales tax is down. I’m probably not pulling my weight in remedying that problem, but I’m living within my meager means. I don’t plan to help pull the state out of it’s budgetary problems anytime soon. Anyone not sure of their finacial future should join me by steering clear of stores this Black Friday. If it’s too late, take that stuff back before you lose your receipts.
A 1 Plus post
so who makes sure the sales taxes we DO pay actually goes on to the state?? I hear there is an awful lot of keeping the creme from the top.
Maybe its time to start cutting employees in Augusta!
cut the employees all you want, it won’t solve the problem. lawmakers are going to have to look at cutting programs. Cutting the employees won’t save enough money. do away with providing safe link phones to people on welfare and food stamps. AZ doesn’t provide them with phones. Do away with DV, it is amazing the money that is spent by the state as a result of DV. better yet, do away with methodone immediately. People lives without it for yes. Save the babies born to women on methodone.
The liberals will save us by shopping the christmas/Holiday season. The Media told them to shop. All’s Good. Sales tax revenue will be up. Must Shop, Must Shop, Must Shop…. There!! some just needed reinforcement
Flat tax. 5%
if you make 10K a year= $9.00 a week if you make 100K =$90.00 a week. that is ten times what the person next to you in the grocery store is paying.
Now thats fair.. No exemptions, No deductions.. Simple and we could get rid of 90% of the Maine Revenue Service employees.
A Flat Tax is a major tax reduction for the wealthy and would not pay for public education, road repair, snowplowing, law enforcement etc.
The rich are not job creators and this whole notion of trickle-down economics is an empirical and historical failure.
Try again
Yessah
flat tax only benefits the rich .
If the state can’t make budget again then why don’t Liepage cut taxes again for the rich.. That should fix it.. Duh!!! How can these republicans actually think cutting taxes will bring down the deficit? As I said when the Ogre got elected, The Republicans have one agenda and one agenda only and that was to bankrupt the states.. Everywhere there is a republican governor that cut taxes for their state and gave all these tax breaks to the rich and companies they are doing poorly.. Where the democrats are at least treading water.. You watch i have been right all along so far, Liepage will only put us in more debt then we have ever been, and some idiot’s will reelect the buffoon for another 4 years…
Oh but LePage said he would be a one term GOv!
But it is the sales tax and corporate income tax revenues that have been falling short since the budget was constructed, neither of which were lowered since the budget was constructed. This really blows your argument out of the water that lowering taxes is to blame. And although you did your best to hide your true feelings, a wee bit of prejudice crept in. You must be a Francophobe to hate our Governor so. You may not know it, but you are. There can be no other explanation, you Francophobe.
The whole country is still recovering from the real estate bubble collapse from 2008.
Without the jobs that came with home building and refinancing our economy can’t grow. State gov’ts don’t have any, reliable, ways to reverse this reality. There’s no magic bullet just a slow slog back to 2007.
Tax the rich is the only thing the left can come up with? I’ve never been hired by a poor guy.
$26M in the hole 4 months after the new budget year is due to a sudden drop in revenues and “confusion” at the federal level. Pooh! That sounds more like gross incompetence among state forecasters and Chinese fire drills in the state planning office. I thought LePage was going to take care of all these Democratic created budgetary problems.
Politicians want American factory workers to make a “living wage”. You read it here almost daily and it basically comes from the left. So we set up rules and regulations and the unions fight and win the “living wage” for the workers. Then American made products become too expensive so we all go to Walmart and buy cheap stuff from China. Now we have our cake and we can eat it too. Cheap goods and plenty of money for our factory workers except now that we buy everything from China, our factories are producing goods that no one wants. The factories close, the workers are unemployed with no health insurance and the result is the America we now live in brought to you by Washington DC. You can blame the one percent all that you want but government policy got us here and government policy will get us out. All of the blame lies in Washington DC and the absolute idiots that we send there to do America’s work. We just had an election and we pretty much sent the same dysfunctional crew right back to continue the downward spiral. We don’t “think” anymore in America, we just expect that we can indeed have our cake and eat it too.
And your solution for the corporate greed that got us here is to take it out on American workers not work for a world wide living wage?