| A Bond Package that Invests in Maine’s
Future— Critical for Long-Term Growth
Governor Baldacci signing the bond proposal.
The $295 million bond package includes:
—
$98.5 mill to research and development, and higher education
—
$60.5 mill for conservation, the environment, and quality places
— $136 mill for
transportation infrastructure
by
Ramona du Houx
The
Appropriations Committee created a bond package that nearly mirrored Governor
Baldacci’s bond proposal. The bond package, worth $295 million, would invest in
innovation, job creation, education, the environment, and transportation.
"We all
know that Maine is on the edge of a great transformation. The old ways are no longer
sufficient for a 21st-century, global economy. We must all work smarter, faster, and
better. This is about creating jobs and opportunities," said Baldacci about his
proposal. "My plan is aggressive, but it is also affordable. It takes careful measure
of what we can do, and what we need to do."
Earlier in
March, the governor and members of the Legislature met with representatives from Fitch
Rating Service, Moody’s Investors Service, and Standard & Poor’s to discuss
the state’s ability to invest in bonds.
Governor Baldacci
announced his bond proposal in March during a press conference full of supporters of his
bold measure for Maine’s future economy.
Across the
board the agencies were positive towards Maine’s current economic outlook, debt
handling, and capacity to increase the state’s general obligation bonding load. They
further concluded that Maine’s low debt load and conservative debt retirement
schedule has increased the state’s bond capacity significantly.
"They
recognized that we have rebuilt our reserves, reduced our borrowing, all the while
tackling $800 million in new education spending," said Governor Baldacci.
"Compared to other states, Maine has been conservative in its bonding and has ample
ability to invest in our infrastructure and economy."
"Transportation,
jobs, and innovation are all elements of a solid foundation for growth," said House
Majority Leader Hannah Pingree. "The agencies made it clear that not only is Maine
fully capable of making these investments, but we also have a responsibility to make them.
Moody’s pointed out that not making investments in both the economy and our
infrastructure could actually hurt our financial standing down the road."
"We heard
a lot of good news about our capacity to invest in our state," said Speaker of the
House Glenn Cummings. "By making these investments we can create jobs and build
prosperity in Maine. I was also glad to hear such broad commitment from all legislative
leaders to move forward with bonds this session."
Maine repays
bonds in just 10 years, compared to 20 years in most states, enabling the people of Mane
to pay less in interest. The state has not invested in bonds for two years, leaving a gap
in areas that need funding, like transportation, research and development, jobs, and
innovation. During the last session, Republicans stopped bond investment in transportation
mainly because it was an election year.
"For the
past two years, politics has stood in the way of progress," said Baldacci when he
announced his bond proposal. "Moving Maine forward shouldn’t be about Democratic
ideas or Republican ideas. Partisanship has no place in this debate. What we decide in
Augusta must be sent to the voters for ratification. For two years, voters have been
denied their say. That’s long enough."
This session
there were a number of bond proposals put forward by Democratic legislators that reflected
the Brooking Institution Report which stated that Maine is falling short in investments
for conservation, innovation, transportation, jobs, and research and development. These
legislators proposed bonds for more funds in all the areas the governor targeted for bond
investments.
Commissioner
of Conservation Pat McGowan discusses bonds with Martha Freeman, director of the State
Planning Office.
The $295 million bond package includes:
—
$98.5 mill to research and development, and higher education
—
$60.5 mill for conservation, the environment, and quality places
— $136 mill for
transportation infrastructure
"I’m
very pleased," said Commissioner of Transportation Dave Cole. "We asked that
$100 million be considered; we’re extremely grateful that the governor and
Legislature have seen the great need for our improvements in our transportation
infrastructure."
"It’s
great," said Sen. Denis Damon, Chair of the transportation committee. "But we
mustn’t lose sight that our roads and bridges are in need of constant maintenance.
The funding has to continue into the future."
"I’m
pleased that the governor and the Legislature have recognized that research and
development is key to our economic future," said Habib Dagher, director of
UMaine’s Advanced Engineered Wood Composites Center.
Sound financial
practices during the Baldacci administration have laid the foundation for the state to
invest in a sizable bond package. On average, the state pays down $70 million of debt each
year. Maine ranks 33rd among states in debt per capita and 34th in debt as a percentage of
personal income.
"We have
closed a $1.2 billion structural gap, eliminated short-term borrowing, and rebuilt our
reserve accounts to the tune of $150 million. That hard work has put us on a firmer
financial footing, and has given us the opportunity to invest today," said Baldacci.
In order to
bring about a bipartisan agreement long hours were spent in negotiations. With the
Brookings Report and the recommendations made by the governor’s Council of Jobs and
Innovation, Republicans were able to better understand that the state needs to invest
today for more jobs in the global innovation economy. From the research and development
funding, $50 million will go to a competitive R&D fund administered by the Maine
Technology Institute. Although it falls short of the governor’s recommendation, it
still is a breakthrough for the future of Mane’s innovation economy.
"I think
about where the Legislature was when this discussion started," said governor
Baldacci. "There was a great distance between Democrats and Republicans. Now there is
a common understanding that we must invest not only in asphalt and gravel, but also in the
underpinnings of the economy of tomorrow. The health of our economy depends on a long-term
commitment to innovation and economic development."
"Too often
our focus is placed on immediate needs and not the long term," said Cummings.
"Maine’s economy is changing drastically, and we have to transition with it in
order to ensure that it is not relying on old ways and old technologies. The
governor’s bond package laid out a strategy that invests in the entire infrastructure
that drives this modern economy. He gave the Legislature a tremendous plan to move Maine
forward. Now voters will have a chance to make investments in areas that will encourage
the long-term growth of our state."
"I think
the entire bond package is exciting and necessary. Maine people are demanding an
opportunity to vote on their future," said John Richardson, commissioner of the
Department of Economic and Community Development. "Now they can."
The bond
package will go out to voters in three phases: June 2007, November 2007, and June 2008.
|
