December 3, 2012

Our View: All in the family: Work together on state budget shortfall

Tough times are best handled by joint efforts and cooperation, as any family can tell us.

If a typical Maine family were facing the kind of problems that the state itself is being forced to confront, the family's situation might look like this:

click image to enlarge

Gov. Paul LePage has said he will issue an across-the-board curtailment order to reduce state spending immediately, but legislators have offered to hold a session this month to work toward a solution to the budget shortfall.

2012 File photo/The Associated Press

First, their employers would tell them just before Christmas that their income was being cut substantially.

They would have to go home and figure out how to buy everybody presents -- not to mention food and gas and pay the rent -- with much less money.

Second, they would discover that their employers were also cutting back significantly in the amount of support they provided for health care, at the same time family members were due to have some expensive procedures.

Finally, the family members would be fighting over whether they needed to find extra sources of income, or tap into their long-term savings, to pay all the extra costs required to maintain their current standard of living.

Or, they could cut back on what they spent on themselves and other family members they helped support to focus on what truly was essential -- except that they disagreed on what spending was necessary and what wasn't.

However, if they fail to agree on what to do, the situation will only get worse.

That's where Maine state government finds itself -- facing an immediate revenue shortfall that has grown from $20 million in October to $35.5 million today, along with a just-announced projection of coming up $100 million short in funding for MaineCare, the state's version of Medicaid, by the end of the fiscal year on June 30, 2013.

Some of this is due to state sales, income and corporate tax revenue falling below projections because the state's economy failed to grow as quickly as hoped. And some of it is due to the federal government cutting back on its matching funds from 74.7 percent to 62.5 percent in just the past two years. The state has also been unable to get federal approval for MaineCare spending cuts totaling between $10 million and $30 million. Those expenditures contribute to the shortfall, state officials say.

Gov. LePage has said he will issue an across-the-board curtailment order to reduce spending immediately, but legislators have offered to hold a session this month, rather than wait until January. LePage should welcome such a move, because if Democrats in the Legislature and a Republican governor would rather fight than work together, the rest of this family -- Maine citizens -- will only suffer for it.

We can do better than that.

 

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