Difference between revisions of "Maine state budget and finances"

From Ballotpedia
Jump to: navigation, search
m (Text replace - " <ref>[http://www.t" to "<ref>[http://www.t")
m (Text replace - " <ref>[http://www.p" to "<ref>[http://www.p")
Line 156: Line 156:
| align="center" style="background:#f0f0f0;"|'''Fitch'''<ref name=debt>[http://www.statebudgetsolutions.org/publications/detail/state-go-debt-ratings "State Budget Solutions", ''State GO Debt Ratings," accessed August 19, 2013]</ref>
| align="center" style="background:#f0f0f0;"|'''Fitch'''<ref name=debt>[http://www.statebudgetsolutions.org/publications/detail/state-go-debt-ratings "State Budget Solutions", ''State GO Debt Ratings," accessed August 19, 2013]</ref>
| align="center" style="background:#f0f0f0;"|'''Moody's'''<ref name=debt/>
| align="center" style="background:#f0f0f0;"|'''Moody's'''<ref name=debt/>
| align="center" style="background:#f0f0f0;"|'''S&P''' <ref>[http://www.pewstates.org/projects/stateline/headlines/infographic-sp-state-credit-ratings-20012012-85899404785 ''The Pew Charitable Trust'', “Infographic: S&P State Credit Ratings 2001–2012," accessed August 19, 2013]</ref>
| align="center" style="background:#f0f0f0;"|'''S&P'''<ref>[http://www.pewstates.org/projects/stateline/headlines/infographic-sp-state-credit-ratings-20012012-85899404785 ''The Pew Charitable Trust'', “Infographic: S&P State Credit Ratings 2001–2012," accessed August 19, 2013]</ref>

Revision as of 22:07, 6 March 2014

Maine state budget

Flag of Maine.png
Budget calendar:  Biennial
Fiscal year:  2013
Date signed:  June 20, 2011
Financial figures
GF expenses:  $3.1 billion
All funds expenses:  $6.1 billion
Other state budgets
AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareFloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming

Maine operates on a biennial budget schedule, with the current biennial budget for FY2012-13 totaling $6.1 billion.[1]

As of August 2012, Maine has a total state debt of approximately $17,238,513, when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the budget gap.[2] The state debt total was similar to the prior year's total of $17,692,888,000.[3]

Maine's total state debt per capita is $12,978.97 as of October 2012.[4]

See also: The Maine State Budget on State Budget Solutions

Federal Aid to State Budget

The chart below represents how much of the state’s budget comes from the federal government. The number is the corresponding ranking in relation to the rest of the nation (if #1, the state receives the highest percentage of federal funding in the nation): [5]

State 2008 2009 2010 2011
Maine 32.4% (#14) 39.3% (#6) 40.19% (#14) 39.29% (#13)
  • Figures were calculated by dividing each state’s intergovernmental revenue into its general revenue.[6][7]

Fiscal Years 2014-15

Fiscal Year 2014 begins on July 1, 2013. In Nov. 2012, the state reduced revenue expectations for the biennium by $128 million dollars due to decreased revenue collections.[8]

Gov. Paul LePage introduced his proposed two-year $6.3 billion state budget on Jan. 11, 2013. Find the proposal here.

Fiscal Years 2012-13

A proposal by Gov. Paul LePage in Jan. 2013 would take $14 million in casino funds earmarked for public schools and move it to the state General Fund to help fill a $112 million budget gap.[9]

As of Nov. 28, 2012, the state faced a $35 million budget shortfall. As a result, the governor is expected to issue a spending curtailment order in mid-December.[10]

On June 20, 2011, Gov. Paul LePage signed the $6.1 billion state budget for FY2012-13 into law. The governor said that he appreciated the tax cuts in the budget, but added that he believed that the cuts would be insufficient in the long run. He said that further spending cuts will be needed, perhaps as soon as the January 2012 legislative session.[1] The governor had initially wanted $203 milion in cuts, but the legislator made just $150 million in tax cuts.[11]

The 540 page FY2012-13 budget can be found here.

Legislators addressed a gap of more than $83 million gap through June 30, 2013, that remained in the state's Department of Health and Human Services' budget when they passed a supplemental budget on May 15, 2012.[12] Gov. LePage signed the revised budget on May 16, 2012.[12] Highlight of the revised budget include:

  • elimination of health care coverage for more than 20,000 people;[12]
  • cuts to prescription drug coverage for senior citizens;[12]
  • reduction of funding for Head Start.[12]

Legislators to use $25 million of the FY2012 surplus, which would have brought in another $50 million in matching federal dollars, to pay off some of the state's debt to hospitals. The state owes Maine hospitals at least $460 million for underpayment going back six years.[13]

Supplemental Budget

Gov. LePage signed the supplemental budget into law on April 24, 2012. He line item vetoed funds for the state psychiatric hospitals.[14]

The Legislature approved a supplemental budget bill on April 12, 2012, but it varied significantly from Gov. LePage's proposed version. The legislative version includes $31 million in new spending for 2012 and 2013, which is offset by $41.8 million in general fund savings. The legislative budget shifts savings from one area to fill in shortfalls in other areas.[15] The governor said he would not sign by the bill because he feels it does not sufficiently address welfare reform.[15]

The Appropriations Committee agreed on a supplemental state budget for the two years ending in mid-2013 on April 9, 2012. Democrats say the budget avoids the full force of Republican Gov. Paul LePage's proposed cuts in general assistance, and it fully restore funding to Maine Public Broadcasting Network, which the governor's proposal did not.[16]

The governor proposed a supplemental budget, which can be found here, to address the $220 million budget shortfall at the Department of Health and Human Services, which is responsible for the state's growing Medicaid program. The supplemental budget would restructure Medicaid eligibility and payments. Medicaid accounts for 21-percent of the general fund budget and 32-percent of all spending in Maine.[17]

In January 2012, the governor threatened to close schools and use that money to keep the state running should Democrat lawmakers modified his supplemental budget plan, although that would be difficult for the governor to accomplish unilaterally.[18]

Streamlining Commission

Maine has a Streamlining Commission comprised of lawmakers and members of the public. The group is responsible for developing proposals to trim $25 million from the FY2013 budget.[19] The group did identify $25 million in cuts when it concluded its work in Nov. 2011 and its recommendations will be subject to public hearings prior to going to the legislature in 2012. The cuts target redundancies, range from a $20,606 reduction for school-based health centers to a $3.1 million reduction in reimbursements to acute care hospitals for outpatient services. The cuts can be found here.[20]

Health and Human Services

The budget includes welfare rollbacks, including eliminating benefits for legal noncitizens not receiving them now, but legislators rejected a LePage proposal that would have eliminated MaineCare benefits for parents who earn between 133 percent and 200 percent of the federal poverty level and for childless adults.[1]

In November 2011, the head of Department of Health and Human Services said that she expects a budgetary shortfall of more than $70 million by the end of FY2012 due in part to an increased use of social services failure to achieve some planned cost savings.[21]

Pension Reform

The budget requires that the state pay down a $4 billion unfunded liability by 2018.[1] It does so in part with a one-year freeze on increases in state worker pensions and limiting annual cost-of-living increases to 3 percent.[11]

Estate Tax On Jan. 1, 2013, under the state budget the estate tax exemption will double from $1 million to $2 million[22]

Legislative Proposed Budget

Both the House and the Senate approved the $6.1 billion FY2012 state budget.[11] The Legislature's Appropriations Committee reached a compromise on a $6.1 billion FY2012 state budget on June 9, 2011. The committee's budget plan includes tax cuts and welfare reform and scales back the scope of pension reforms proposed by the governor. It also continues funding for the Maine Public Broadcasting Network that the governor wanted to eliminate altogether.[23]

Governor's Proposed Budget

Gov. Paul LePage proposed a $6.1 billion budget for the FY2012-13 biennium. It cut $203 million in taxes in part by lowering the top income tax bracket from 8.5 percent to 7.95 percent and saves $413 million in general fund spending for the state's unfunded pension liability. Under that proposed budget, state workers would face a three years' proposed freeze in pensions, the retirement age for new hires would rise from 62 to 65 and the workers' retirement contributions would rise by 2 percent. [24]

The first week of May 2011 the governor proposed a revised budget in light of an unexpected $164 million deficit. To plug the hole, the governor would eliminate more than 250 state positions, most of which were vacant at the time of his announcement, and increase the pension contributions of employees. The revised budget also would eliminate MaineCare (the state Medicaid program) eligibility for childless adults as well as change the state's welfare program that would make people ineligible for state welfare if they qualified for federal assistance.[25]

As state lawmakers inch toward passing a budget, a proposal to eliminate the Maine Rx program that reduces prescription drug prices was replaced with a plan to make the program self-sufficient through $15 per year fees. The amount earmarked to buy state police vehicles was reduced. [26]


See also: Evaluation of Maine state website or Constitutional provisions regarding reading of bills

Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary
Maine.gov DataShare[27]
600px-Red x.png
600px-Red x.png
600px-Red x.png
600px-Red x.png
  • Line item expenditures are available for FY 2011.
  • The Maine Arts Commission has made a list of grants available. [28]

Independent transparency sites

The Maine Heritage Policy Center created a website, MaineOpenGov, that provides transparency information for citizens.[29]

Multi-Measure Budget Transparency Profile

The Institute of Government and Public Affairs at the University of Illinois created a multi-measure transparency profile for Maine, which measures state transparency as of September 2011 using indicators from a range of organizations, including Sunshine Review.[30] These indicators measure both website transparency and other recognized facets of governmental transparency. In addition, IGPA presents four unique indicators of non-transparency based on the observation that transfers or reassignments between general and special funds can obscure the true fiscal condition of a state. In addition to the individual state profile, IGPA offers a 50-state comparison. [31] It also offers profiles for other states. [32]

Budget background

On or before September 1st of even-numbered years, the judicial branch, the legislative branch and each executive branch department or agency prepare a budget request for the next two fiscal years. The most important restriction on the Legislature in enacting a budget is the Maine Constitution’s guarantee that the State’s budget will be balanced in each fiscal year of the biennium which results from its prohibition on deficit financing. There are two sections in the State Constitution which address the issue. Article IX Section 14 prohibits the State from incurring long-term debt of more than $2,000,000, except for certain specified emergencies, without a vote of the people. In addition, Article V, Part Third, Section 5 prohibits the use of proceeds from the sale of bonds for current expenditures.[33]

The Consensus Economic Forecasting Commission (CEFC) was originally established by Executive Order on May 25, 1992, in order to provide the Governor, the Legislature and the Revenue Forecasting Committee with analyses, findings and recommendations for state economic assumptions to be used in developing state revenue forecasts. Creation of the commission was in response to a recommendation of the Special Commission on Government Restructuring in 1991 to establish an independent, consensus process for state economic and revenue forecasting. Public Law 1995, chapter 368 enacted in statute the Consensus Economic Forecasting Commission, maintaining both the structure and intent of the original Executive Order.[34]

The CEFC is required to develop two year and four year economic forecasts for the State of Maine. In performing this duty, the commission is required by statute to meet twice each fiscal year. No later than November 1st and February 1st annually the commission must develop its findings with regard to the economic assumptions or adjustments to the existing economic assumptions for the State of Maine. The commission submits its findings to the Governor, the Legislative Council, the Revenue Forecasting Committee and the Joint Standing Committee of the Legislature having jurisdiction over appropriations and financial affairs. The Revenue Forecasting Committee is required to use the economic assumptions and forecast of the commission in developing its four-year revenue projections.[35]

Accounting principles

See also: Maine government accounting principles

Maine’s audit reports are published online by the Department of Audit.[36] The Maine Department of Audit's primary responsibility is to audit the financial statements of the State of Maine and expenditures of federal programs. Pola Buckley has been State Auditor since 2012. The Auditor’s statutory authority are under Title 5, Chapter 11 of Maine’s Revised Statutes.[37]

The Institute for Truth in Accounting] (IFTA) rates Maine “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities.[38] IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Maine’s CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[39] Maine's CAFRs are published online by the Office of State Controller.[40] Edward A. Karass is the State Controller of Maine.[41]

Credit rating

The State of Maine was given the following ratings by S&P as of 2012 and by Fitch and Moody's as of 2010.

State Fitch[42] Moody's[42] S&P[43]
Maine AA+ Aa2 AA


Maine received $1.3 billion in federal funding between February 2009 and June 2013.[44]

Public Employees

See also: Maine public employee salaries
See also: Maine public pensions

According to 2011 Census data, the state of Maine and local governments in the state employed a total of 95,011 people.[45] Of those employees, 64,462 were full-time employees receiving a net pay of $208,492,390 per month and 30,549 were part-time employees paid $ 32,044,459 per month.[45] More than 60% of those employees, or 57,954 employees, were in education or higher education.[45]

The Maine State Payroll is posted in searchable form on MaineOpenGov[29]. A searchable database of local government salaries is also found at MaineOpenGov.

See also

External links


  1. 1.0 1.1 1.2 1.3 The Bangor Daily News "LePage signs budget but says it only does half the job" June 20, 2011
  2. State Budget Solutions "State Budget Solutions' third annual State Debt Report shows total state debt over $4 trillion" Aug. 28, 2012
  3. State Budget Solutions “Report reveals aggregate state debt exceeds $4 trillion” Oct. 24, 2011
  4. State Budget Solutions "State debt more than $37,000 per private worker, $13,000 per capita" Oct. 2, 2012
  5. Tax Foundation, "Monday Map: Federal Aid to State Budgets," accessed August 16, 2013
  6. US Census Federal Aid to State and Local Governments
  7. Tax Foundation' "Monday Map: Federal Aid to State Budgets. Accessed October 15, 2013
  8. The Boston Globe "Red ink flowing in Maine budget" Nov. 28, 2012
  9. The Bangor Daily News "LePage wants to use casino money earmarked for education to close state’s budget hole" Jan. 26, 2013
  10. The Boston Globe "Red ink flowing in Maine budget" Nov. 28, 2012
  11. 11.0 11.1 11.2 Businessweek "House, Senate OK Maine's $6.1 billion budget" June 16, 2011
  12. 12.0 12.1 12.2 12.3 12.4 The Morning Sentinel "Gov. LePage signs state budget" May 16, 2012
  13. The Maine Public Broadcasting Network "Maine Hospitals Worried State Won't Be Able to Pay What It Owes" July 31, 2012
  14. MPBN.net "Gov. Paul LePage Signed the Supplemental State Budget" vApril 24, 2012
  15. 15.0 15.1 The Bangor Daily News "Legislature gives initial approval to supplemental budget; LePage says he won’t sign" April 12, 2012
  16. WGME.com "Maine budget gets key committee's OK" April 10, 2012
  17. "LePage Administration Introduces Supplemental Budget Addressing Medicaid Shortfall" Dec. 6, 2011
  18. MPBN "LePage Threatens to Close Maine Schools if Democrats Change Budget Plan" Jan. 20, 2012
  19. Morning Sentinel "Budget-cutting panel continues quest for $25M" Sept. 15, 2011
  20. The Bangor Daily News "State budget task force agrees on $25 million in cuts" Nov. 2, 2011
  21. Businessweek "Maine department projects $70 million budget gap" Nov. 7, 2011
  22. Forbes "Ohio Repeals Its Estate Tax; Maine And Oregon Tweak Theirs" June 30, 2011
  23. Businessweek "Panel agrees on $6.1B state budget in Maine" June 10, 2011
  24. Businessweek "Hearings on 'Spartan' Maine budget open" March 1, 2011
  25. The Bangor Daily News "LePage budget fix would cut welfare benefits, state jobs" May 10, 2011
  26. Business Week, Maine budget writers get closer to accord, June 6, 2011
  27. Maine.gov, "DataShare," accessed August 19, 2013
  28. 'The Maine Arts Commission, "Grants," accessed August 19, 2013
  29. 29.0 29.1 'Maine Open Gov, accessed August 19, 2013
  30. University of Illinois Institute of Government and Public Affairs, "Maine: Budget Transparency Profile," accessed August 19, 2013
  31. University of Illinois Institute of Government and Public Affairs, "Alabama: Budget Transparency Profile," accessed August 16, 2013
  32. University of Illinois Institute of Government and Public Affairs, "State Transparency Profiles," accessed August 16, 2013
  33. Maine State Legislature, "Budget Process," retrieved October 24, 2009
  34. Maine Bureau of Budget, "Governor’s Recommended 2010-2011 Biennial Budget Overview," January 9, 2009
  35. Maine Bureau of Budget, "Governor’s Recommended 2010-2011 Biennial Budget Overview," January 9, 2009
  36. State of Maine Department of Audit, "Fraud Reports," accessed August 19, 2013
  37. Department of Audit Web site, retrieved October 24, 2009
  38. Institute for Truth in Accounting, accessed August 16, 2013
  39. Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  40. Office of the State Controller, "Comprehensive Annual Financial Report (CAFR)," accessed August 19, 2013
  41. Office of State Controller Web site, retrieved October 24, 2009
  42. 42.0 42.1 "State Budget Solutions", State GO Debt Ratings," accessed August 19, 2013
  43. The Pew Charitable Trust, “Infographic: S&P State Credit Ratings 2001–2012," accessed August 19, 2013
  44. Recovery, "Stimulus Spending by State"
  45. 45.0 45.1 45.2 2011 Public Employment and Payroll Data