Maine news, sports, weather | Kennebec Journal, Augusta, Maine

Envision Maine outlines its billion-dollar state savings plan

By J. Hemmerdinger jhemmerdinger@pressherald.com
Staff Writer

PORTLAND -- Maine could save $1 billion a year by streamlining its government and cutting spending to levels closer to those of comparable states.

That was the message delivered Wednesday by Envision Maine President Alan Caron, who spoke to about 200 business people at a breakfast hosted by the Portland Regional Chamber.

Caron, who outlined the findings of "Reinventing Maine Government," a report published by his group late last year, said Maine's economy is hindered by excessive state spending.

He said Maine's state payroll costs exceeds the national average by 36 percent, and Medicaid and welfare spending is 69 percent higher. Health care spending in Maine is 80 percent higher than the average for rural states, and legislative spending is 68 percent higher.

Footing the bill are taxpayers, whose contribution to government is 13 percent more than the national average, he said.

Caron said in a phone interview that much of his data came from Philip Trostel, an economics professor at the University of Maine.

Caron called Trostel's method unique because it compares Maine with five states -- Vermont, Wyoming, Mississippi, Montana and South Dakota -- that have a similar percentage of residents in rural areas. It is an "innovative" approach, Caron said, and "a heck of a better way to compare things."

"I don't think we have ever seen this kind of direct comparison in these type of categories," he said.

Caron said he started working on "Reinventing Maine Government," which was released in November, after he read the Brookings Institution's 2006 report "Charting Maine's Future," which suggested that Maine "scrutinize its state and local government system to locate cost savings."

Caron estimates that government reforms and spending cuts could save the state $1 billion a year, money that could be invested in business tax incentives, for improvements in transportation and for higher education -- the one category in which Maine spends less than the national average. Savings could also allow a cut in the state income tax to 5.5 percent.

Caron's message hit home, said Amber Baxter, sales manager at the Portland Regency Hotel & Spa, who attended Wednesday's Eggs & Issues breakfast.

"He brought up some very good points. Some of the numbers were really surprising, such as our spending compared to the national level," she said.

But Baxter wished Caron had discussed a clear path to reform.

"I would have liked more perspective (about) where we start to address the problems," she said.

Caron said substantive changes could take a decade and will require Mainers of both political parties to work together. But, he said, the goal is simple.

"We have to be average. It's not that complicated," he said.

One attendee, Peter Murray, a lawyer with Murray, Plumb & Murray in Portland, said he thinks many Mainers can get behind Caron's message.

"There are things about our government ... that people from wide political beliefs believe need to be changed," said Murray. "There seems to be a foolish misuse of resources."

Caron said he thinks Gov. Paul LePage understands the problem but may not have taken the right tack. The "substantive rollbacks" in the governor's regulatory reform proposal have stirred "a deep opposition that could harm all of us," he said.

Kenneth Bowden, CEO of First Atlantic Healthcare, said he is eager to see whether LePage can pull Maine out of a "rabbit hole" of overspending and inefficiency.

"We are wondering where we will find the next inspired leader, and we hope we have him now," said Bowden as he left the event.