After more than two years of posturing on state borrowing, Augusta seems poised to take long-awaited bipartisan action to boost Maine’s economy.
The Appropriations Committee unanimously recommended $149.5 million in borrowing Thursday that could be invested in roads, bridges, ports and upgrades to higher education facilities and armories as soon as next year. The proposal is the result of negotiations between legislative Democrats and Republicans and the governor’s office and it represents significant compromise on all sides.
If everyone lives up to what they have promised, the bonding will get the two-thirds support it needs in the House and Senate and the signature of Gov. LePage, sending it to voters in November. With voters’ approval, this package would take advantage of low interest rates, leverage federal matching funds, put people to work in the still distressed construction trades and make improvements that will boost the Maine economy in the long term.
WHY SO LONG?
Lawmakers should have no question about whether to vote for these bonds. The only question is why Mainers have had to wait so long.
The obstacle has been Gov. LePage, who along with former state Treasurer Bruce Poliquin ran a purely ideological war against bonding that distorted reality and claimed any government borrowing would be a drag on the economy. As a result, there were no bonds sent to the voters in 2011, and a limited package passed by the Legislature without the governor’s support in 2012.
In the meantime, Gov. LePage sat on $100 million in bonds already approved by the voters, announcing that he would not issue them until 2014 at the earliest. Fortunately, that’s a promise he did not keep.
The governor and Poliquin made no distinction between revenue shortfalls that resulted from the economic downturn and bonded indebtedness used for long-term investments in roads and bridges and other infrastructure, calling them both debt. It made as much sense as it would be to say that anyone who takes out a mortgage is living beyond his means, but the governor would not budge.
BAD FOR THE ECONOMY
The opponents of investment would not acknowledge that Maine has been very conservative with its borrowing. The state has kept outstanding debt below its capacity and has paid back bonds on an aggressive timetable. Calling bonding bad debt might be good politics, but it hasn’t been good for the state’s economy. Maine was second to last in the nation for job creation last year.
While other states were borrowing money at historically low rates and investing in their future, Maine stood pat. Now Maine will have to play catch-up. The deal recommended by the Appropriations Committee is better than no bonding at all, but it still leaves many state needs unmet.
There is no Research and Development bond going to the Legislature as part of the agreement with the governor, lawmakers say.
There also will not be any land preservation or water and sewer projects funded. These will have to wait until the Legislature reconvenes next year.
Even though it should be more comprehensive, the bipartisan package approved by the Appropriations Committee is a step in the right direction. Legislators should pass this modest borrowing package and so should the voters.