Highlights
of Maine’s Proposed Budget
"This is a balanced budget that makes critical investments,"
said Governor Baldacci, announcing his budget.
Please click on
the links below to go directy to the issue highlighted:
Highlights of Maine’s
Proposed Budget
by Ramona du
Houx
Governor
Baldacci did what he always has done when he campaigns — he listened carefully to the
people of Maine. They were upset, about their houses being assessed at rates that made it
nearly impossible to pay their property taxes. They were upset about their local
superintendent’s office adding to their property tax bills by increasing expenditures
for their administration, instead of enhancing their children’s educational
opportunities.
During the past
four years the governor set the stage for dramatic change in Maine’s educational
system and tax structure. Working with the Legislature, he enacted LD 1, which increased
the circuit breaker, giving 200,000 Mainers the ability to receive rebates on their
property taxes. LD 1 also placed caps on spending for school administrations,
municipalities, and state government. He put the Essential Programs and Services (EPS)
school funding formula into action, which is working to make state school funding
equitable across Maine, focused on essential needs and increased state funding to
education, from 43 percent to 50 percent.
Now he has
proposed a $6.4 billion biennial budget package that takes bold measures to reduce
government without broad-based tax or fee increases, and reduces property tax while it
consolidates Maine’s school districts’ burgeoning bureaucratic administrations.
"This is a
balanced budget, that makes critical investments," said Baldacci. "It protects
Maine’s most vulnerable citizens, while streamlining the administrative bureaucracy
in the public school system, and providing tax relief for Mainers.
"Importantly,
the budget presented here reflects my continued commitment to property tax relief through
an increase in the state’s share of education funding to a full 55 percent by state
fiscal year 2009. This initiative will result in a $170 million reduction in the funding
burden at the local level, providing immediate, mandatory property tax relief for Maine
families and businesses."
With the
increase of state education funding, he will demand that local municipalities guarantee a
reduction in property taxes. He has vowed to veto any proposal that does not ensure this
guarantee.
Baldacci is
firm about using the power of his veto because school administrations across the state
have exceeded the LD 1 spending cap. If they had stayed within the cap, Mainers should
have received a substantial property tax cut. Part of the governor’s plan to reduce
property taxes has always been linked to education spending, because usually the largest
expenditure towns have is in education costs. The logic is simple: have the state increase
its spending on education, then local property taxes should diminish. The LD 1 cap should
have encouraged school administrations to stay within spending limits. But they decided to
break faith with the people they serve and continue spending beyond their means despite
800 million state dollars being channeled, by fiscal year ’09, into education from
this administration.
The second
annual progress report on LD 1 showed that the growth rate of property taxes was lower
than before the law went into effect. According to the State Planning Office (SPO) report,
about 70 percent of increased state funding is being used to offset local property tax
revenues.
Henry Renski, an economist who holds a Masters in Regional Planning,
helped compile the LD 1 progress report. Renski said that school administrations continue
to spend more than the limits prescribed by LD 1, while the State and municipalities stay
within the limits — saving taxpayers money.
"This
year, evidence of LD 1’s impact is mixed. The state and a majority of county and
municipal governments stayed within their capped limits. They kept their word with the
people to abide by these benchmarks. In 2006 we saw a tax savings of $94 million for
resident homeowners and $23 million for businesses," said Martha Freeman, director of
SPO. "But eighty-one percent of school administrative units exceeded their LD 1
limits, and growth of total school appropriations increased for the third year in a
row."
"Eighty-one
percent of school administrative units exceeded the spending benchmarks. That’s right
over eight out of ten. This is unacceptable. We must have accountability at all levels of
government, and school administrative districts, like everybody else, must learn to live
within their means," said Baldacci strongly. "Maine people have not gotten the
relief they deserve. It’s unacceptable, and changes need to be made. That’s why
I have proposed reform of school administration, improving education of our children and
giving relief to Maine resident property tax owners.
"I will
veto any bill which does not contain mandatory provisions to pass savings on directly to
the people. Maine people deserve better. They will get it."
Baldacci’s
chief-of-staff, Jane Lincoln, talks budget issues with Ryan Low, deputy chief-of-staff.
The Local Schools
Regional Support Initiative (LSRSI) — school administration reform
The
governor’s Local Schools Regional Support Initiative (LSRSI) has proven to be the
most controversial part of his budget proposal. While it is heartening to witness how
deeply Mainers feel about education as they attend public forums, it’s disturbing to
see that some have made assumptions that aren’t based on the facts about LSRSI.
Communities
will have more opportunities to participate in their schools by diminishing the top-down
approach that has happened with an overabundance of superintendents and their
administrations. In essence the governor’s proposal gives schools back to their local
communities, while increasing state education funding and lowering property taxes —
exactly what people across the state have been asking for.
"What the
governor is proposing is downsizing the 290 school administrative units to 26 regionalized
administrative districts. Each would get a superintendent, administrative staff; and a new
elected regionalized school board — representing communities that are within that
region. Each school would then transition from the current school boards to a local
council of parents and community members that would advise each school and would be
accompanied by a full-time principal. All this would put more focus on the classroom,
giving more opportunities for communities to participate in their schools," said
Commissioner Becky Wyke of the Department of Administrative and Financial Services.
"People should give the proposal a chance."
The
state’s existing vocational technical schools are being used as a model for school
district consolidation. The 27 technical schools are a working example of how the plan can
take effect. With a working model it should be easier to implement the plan.
Delaware last
consolidated its schools in the late 1960's from about 400 to 19 school districts.
The new
regional districts would share administration of special education, transportation, human
resources, payroll and purchasing. Often local school board meetings are weighed down with
these issues. In many communities people have stopped attending school board meetings
because administrative issues take up all the time. With LSRSI, local parent-teacher
groups will have the freedom to discuss local educational issues that need attention.
Empowering communities —
These local
school parent-teacher groups will have a principal running them. With LSRSI parents will
have a chance to be listened to and teachers will have a place to have there ideas heard.
The people that work with students on a daily basis will be the ones making local
decisions on how to educate their children, thereby empowering communities.
"It is
about local empowerment," said the commissioner of education, Susan Gendron.
"It’s about the involvement of local citizens in their schools. The model
we’re using is actually one I implemented when I was a superintendent. We had a local
advisory board and met with the principals. At the primary school we’d have close to
fifteen citizens who would attend. We want to create that structure, so there are more
opportunities for local involvement."
Every vote counts —
LSRSI intends
to give back local control to the people. In many districts around the state, citizens do
not have an opportunity to vote on the school budget. With the governor’s plan,
everyone who wants to vote on the regional school district budget can do so. Once approved
by the regional school board, three days later the budget would go out to the voters in
that region. The people in the region will be the ones voting on how much money is spent
for a student’s education. A democratic vote gives people more control over where
their money is being spent, for every vote counts.
"We are
giving the ability to vote on the budget back to the people," said Martha Freeman.
"It
strengthens that local voice in budgeting and the budget reflects the policies of the
region," said Gendron.
The Local
Schools Regional Support Initiative could save $241 million over three years.
"We will
reinvest some of the savings realized by this restructuring, extending the student laptop
program through high school. We will also launch a tuition assistance program that will
cover 50 percent of tuition costs at community college rates for financially eligible high
school seniors," announced the governor. "In addition, the savings in
administrative costs would increase professional development for teachers, invest $3.6
million in teacher salaries over the next two years, and place a full-time principal in
every school."
Currently Maine
has 152 superintendents but no full-time principal in 151 schools.
With this
consolidation plan, no school would be closed and hundreds of millions of dollars in tax
relief would result.
Education Commissioner Susan Gendron, DAFS Commissioner Rebecca Wyke and
Martha Freeman, director of the SPO, take a break after discussing LD 1’s benefits of
reducing property taxes while increasing education funding.
After talking
with two principals who had also been superintendents while being active principals, it
became clear that in certain areas of Maine, superintendents can easily take on more
school districts. "I simply had a lot of time left over, so I recommended to the
board that I become a principal as well," said one principal who didn’t want his
name printed. "It was such a waste of the people’s money. Consolidation is long
overdue. I’d like to see the money going back into the classroom. Our kids should
come first. The majority of us are here for them."
"Maine has
one administrator for every 393 students," said Gendron. "We are talking about
shifting resources from central office administration to the classroom to achieve
excellence in education for every student in every classroom in every local school."
Some people
across the state are tired of attending local school board meetings where the
superintendent has too much control. "It seems that if it’s something the
superintendent wants, then it happens. If it’s not the superintendent’s idea,
then it doesn’t," said Mary J. Michaud of the SAD 59. "If the
superintendent was in charge of multiple districts, more would get done locally."
In a poll
commissioned by GrowSmart, conducted from Jan 22–27, support for the LSRS Initiative
was significant. Out of 500 registered voters, 70 percent agreed that "local control
is costing us too much money in added administration." Only 5 percent disagreed, with
the rest undecided.
That added
administration manifests with too many superintendents and their staff. Only 15 percent
did not support a reduction of superintendents in order to provide property tax.
"We are
proud of the work that our administrators are doing, but it is time for a change in the
way our administrative units operate. Bold action is required to ensure that resources are
being spent in the right place: to support students and teachers in the classroom,"
said Governor Baldacci.
"Maine
people are clearly in support of action that will move us forward. The status quo is not
an option," said Alan Caron, president of GrowSmart Maine, unveiling the results of
the poll.
Individual
concerns need to be heard. Accordingly, the governor has already held community forums
across the state. A full day hearing will take place on February 5 at the Augusta Civic
Center, of the governor’s plan and others put forward by legislators and
organizations.
Maine has a
history of embracing good ideas after spirited debate. A few years ago, the state was the
worst in the nation for teenage smoking. Now Maine is one of the best states for
preventing teenage smoking. When the people of Maine take a challenge on board, positive
change can and does happen. Many school districts in other states are larger than those
proposed with LSRSI’s 26 districts; these would range from 1,800 to 20,000 students
each.
Maine’s
time to consolidate school administrative districts is now. Complaints are easily
generated from new ideas. Reducing bureaucracy is something most people want to see
happen. Change is hard for some to accept. The Legislature and Governor’s Office need
your support; please contact them.
Making higher education more accessible —
The education
portion of the budget also includes a slight increase in classroom size to a manageable 17
students in middle and high schools, boosts state funding for higher education by more
than $42 million, and provides tuition reimbursements of $2,000 for thousands of
qualifying students in the University of Maine System, the Maine Community College System,
and Maine Maritime Academy.
Annual tuition
and fees average $2,800 per student in the Maine Community College System and $6,429 for
in-state students enrolled in the University of Maine System. With Federal cutbacks in
Pell grants, college costs have dramatically increased. About 15,000 Maine students would
receive the tuition scholarships at an annual cost to the state of $5.5 million. The
governor is focused on making higher education more affordable.
"The governor has stepped
up making college more affordable and therefore more accessible," praised House
Speaker Glen Cummings.
The increase in the cigarette
tax—
Maine’s attorney
general, Steven Rowe, spoke of how important it is to continue efforts to prevent teens
from smoking. In these formative years, the body absorbs the chemicals more, putting teens
at a higher risk of becoming addicted and dying because of cigarettes. Increasing the
cigarette tax has been shown to prevent teens from smoking.
The cost of a
pack of cigarettes could increase by a dollar, producing $66 million a year and bringing
the tax to $3 — the nation’s highest.
The cigarette
tax also addresses a serious public health problem that costs Maine people $554 million
each year in direct health-care costs. "We want to send a clear message about how bad
smoking is," said Baldacci. "It’s about more than dollars and cents.
It’s about saving lives. Over 29,000 children alive today will die prematurely from
smoking." A pack of cigarettes costs Maine taxpayers $11.61 in Medicaid claims.
Governor John
E. Baldacci recently received a straight-A report card, on behalf of the State of Maine,
for tobacco control from the American Lung Association for the second consecutive year.
The American
Lung Association State of Tobacco Control 2006 Report graded all 50 states in four
categories: smoke-free air, tobacco taxes, prevention funding, and restrictions on youth
access to tobacco products.
"Maine is
succeeding because it has taken a comprehensive approach to fighting the tobacco problem.
Maine is one of the few state that have implemented all three of the most effective
policies to reduce smoking — effective, fully funded programs to prevent kids from
smoking and help smokers quit, a comprehensive smoke-free workplace law that protects
everyone’s right to breathe clean air, and a high cigarette tax," said Kevin
O’Flaherty, northeast regional director, Campaign for Tobacco-Free Kids. "There
is no better example of Maine’s persistence than Governor Baldacci’s new
initiative to increase the cigarette tax by $1 per pack. Increasing tobacco taxes is one
of the surest ways to discourage kids from smoking and encourage smokers to quit,
especially when combined with the other tobacco prevention measures Maine has taken."
"The
proposal to raise the cigarette tax will keep an estimated 10,000 young people from
becoming smokers, saving a third of them from dying prematurely from lung cancer or
another tobacco-related disease," said the governor. "It will also save about
$238 million dollars in health costs."
One of his top
priorities as governor was to make Maine become the healthiest state in the nation.
"Tobacco
use still costs too many lives and too much money," said Governor Baldacci.
"Every year 2,400 Maine people die prematurely from tobacco-related disease, and
every year over $600 million dollars is spent on health costs related to tobacco use. We
need to do everything we can to keep our kids from getting hooked on these deadly
products."
"The
American Lung Association is so proud of what Maine is accomplishing and the leadership
Maine is demonstrating. It’s critical, not only for Maine but for the nation as a
whole, that your state continue to set an example in fighting tobacco use and the other
states follow your example," said Lee Ann Baggott.
Tobacco
companies spend more than $74 million on marketing in Maine. They lobby. First and
foremost, legislators should be thinking about the health and wellbeing of Maine citizens
when they are deciding about the increase in the cigarette tax. Please contact them and
voice your support.
"The proposal to raise the cigarette tax will keep an estimated
10,000 young people from becoming smokers, saving a third of them from dying prematurely
from lung cancer or another tobacco-related disease," said the governor, as he
accepted an all-A report card for ME from the American Lung Association for preventing
smoking.
Managing MaineCare costs
"If
we are to realize sustainable prosperity, we have to be successful at appropriately
managing the costs of the MaineCare program. This does not mean sacrificing our compassion
for the most vulnerable and needy among us; this document does not reflect any reductions
in eligibility or in scope of services," said Baldacci.
"This
budget will expand medical management to all adults receiving MaineCare with the exception
of those dually eligible for MaineCare and Medicare, behavioral health care, and pharmacy
services, helping ensure the provision of the right care at the right time in the right
place. It also envisions the implementation of managed care for behavioral health care
consistent with those paid across New England."
Within the
Department of Health and Human Services, it would save an estimated $11.5 million through
managed care for behavioral health services, $20 million through adjustments in payment
rates for services, and $42 million by expanding clinical management of MaineCare members,
officials said.
"It’s
a bold and decisive-looking budget," said Senate President Beth Edmonds.
Housing assistance—
"This
budget restores funding dedicated for affordable housing and for the prevention of
homelessness. Full funding for the state HOME program means we can leverage additional
federal and private housing resources and create affordable housing for more Maine
people," said Maine Housing Director Dale McCormick. "This is great news for
Maine’s low and moderate income seniors and families who need safe, affordable
housing, and the increased housing activity this money generates will help bolster the
state’s economy. Governor Baldacci recognizes that this is a critical moment to
invest more funds in housing to address runaway housing costs."
From 2000 to
2005, median home prices rose 67.4 percent, median rents rose 32.5 percent, but median
incomes only rose by 14.2 percent.
MaineHousing
uses the HOME program money in conjunction with its housing bonds to provide
low-interest-rate mortgages (5.3%) to first-time homebuyers and to finance the down
payment and closing cost assistance option for homebuyers.
More consolidations
"This
budget continues the administrative streamlining initiatives begun in the current
biennium, in the consolidation of financial services, human resources, and information
technology," said the governor.
A logical
merger of the Department of Economic and Community Development with the Department of
Professional and Financial Regulation would bring together state business agencies: one
that promotes businesses and one that regulates businesses. Many businesses have had to
deal with them both; having them under the same roof makes it easier for businesses to
obtain what they need with more ease and efficiency. Baldacci said this new Commerce
Department would tighten state government’s focus on business.
This plan also
brings the Atlantic Salmon Commission into the Department of Marine Resources.
Investing in Maine’s global economy
"I
have proposed an appropriation of $5 million for the Maine Economic Improvement Fund to be
used for research and development. Moreover, through the Maine Technology Institute, we
will invest $8 million in new innovation clusters that show promising partnerships for
economic growth among businesses, research enterprises, and career education, helping to
spur Maine’s economy," said Baldacci.
A Research and Development,
transportation and Land for Maine futures bond proposal will follow the budget.
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