Politics

December 28, 2012

LePage orders $35.5 million in state spending cuts

Education ($12.6 million) and health services ($13.4 million) will bear the brunt of the cuts, which come after state revenues fail to meet projections.

By Steve Mistler smistler@pressherald.com
Staff Writer

Gov. Paul LePage ordered state spending cuts Thursday that put much of the burden for closing a $35.5 million budget shortfall on public schools and human services.

Gov. Paul LePage

AP

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BIGGEST REDUCTIONS

• Department of Health and Human Services: $13.4 million

• Department of Education (school aid): $12.6 million

• University of Maine System: About $2.5 million

• Department of Corrections: About $1.9 million

• Department of Administrative & Financial Services (mostly staff vacancies): $776,650

• Maine Community College System: About $724,000

• Department of Public Safety: About $427,000

 

The impacts on each school district can be viewed here. The total impacts of LePage's order can viewed here.

The curtailment order is designed to balance the two-year budget that ends June 30. The shortfall was forecast in late November, as state revenues fell behind projections.

The order, anticipated for several weeks, calls for spending reductions in all state departments. Some of the cuts won't take effect for several months, and the Legislature will have a chance to make changes.

That's because the spending reductions will also be in a supplemental budget that LePage will propose in two weeks. That will challenge the Democratic majority in the Legislature, which will have to propose different cuts if it doesn't accept LePage's.

The curtailment order includes a $12.58 million reduction in aid to school districts and a $13.4 million reduction for the Department of Health and Human Services. The two account for roughly 70 percent of the state's budget.

In a prepared statement, LePage said the order is a temporary fix. He challenged lawmakers "to sustain a balanced budget for the long-term," and said "Democrats and Republicans must acknowledge that from year to year we have only put a Band-Aid on the problem.

"Not unlike Washington, we must rein in spending before Maine falls off its own fiscal cliff," he said.

The state Constitution authorizes the governor to make temporary, across-the-board spending reductions to bring the state budget into balance. The cuts must be relatively equitable among departments.

Democratic leaders said they have questions about the effects of LePage's curtailment order. Senate President Justin Alfond said in a prepared statement that Maine can't "cut its way to prosperity."

Sen. Roger Katz, R-Augusta, said, "None of these cuts are easy. ... But most of these reductions won't go into effect until spring ... the (Legislature's budget-writing committee) will have a chance to weigh in, and perhaps they'll have different priorities."

The education cuts vary by district. Districts with higher assessed-property values stand to lose more state aid than those with lower values.

The Department of Education noted that the monthly state aid checks to school districts would not be reduced until February or March, depending on when the curtailment order takes effect or the supplemental budget is passed.

The curtailment order for the DHHS targets $1.5 million in funding for mental health and substance abuse providers, $1.4 million for child adoption services and $1.9 million for foster care services.

The DHHS also has a projected $100 million shortfall in its MaineCare program for the next six months. That is the main reason for LePage to propose the supplemental budget.

That budget is expected to be unveiled Jan. 11, along with the state budget for the following two years.

LePage's curtailment order also calls for cuts of $2.5 million from the University of Maine System, $724,451 from the Maine Community College System and $1.9 million from the Department of Corrections.

It calls for leaving state jobs unfilled. If the Legislature adopts those reductions in the supplemental budget, it may be difficult for Democrats to add jobs in the next two-year budget.

Rep. Peggy Rotundo, D-Lewiston, House chairwoman of the Appropriations Committee, said the unfilled positions raise concerns for her caucus. She noted that there are several vacancies in the Department of Public Safety, including the Maine State Police.

"Those positions exist because there is work to be done," she said, and lawmakers need a fuller understanding of the potential effects of leaving them unfilled.

Rotundo also expressed concern about reductions in the DHHS, including the cuts in adoption support services and a $174,000 reduction in funding for the Office of Elder Services.

She said the Appropriations Committee will ask the administration about the effects when it meets on Jan. 4. The full Legislature won't convene until Jan. 8.

The governor closed state offices Thursday because of the snowstorm, but his staff put the finishing touches on the curtailment order in the morning. Sawin Millett, LePage's chief budget officer, announced the order in a media conference call Thursday afternoon.

"We are carefully reviewing the governor's spending cuts," House Speaker Mark Eves, D-North Berwick, said in a statement in response to the order. "We need to get to work early to ensure our budget is balanced in a fair and reasonable way."

Staff Writer Steve Mistler can be contacted at 791-6345 or at:

smistler@pressherald.com

twitter/stevemistler

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