Greetings, this is Kathy Chase, state representative from Wells.
When the Legislature convenes in January, one of the top priorities will be passing a supplemental budget to deal with a sharp decline in state revenues. With the economic downturn, fewer people are working and paying income taxes and fewer shoppers are shopping and paying sales taxes. By law, the state budget must be balanced, so legislators will have to find a way to cut spending by $50 million or more. It is disturbing, to say the least, that the budget is short by tens of millions of dollars just 90 days after taking effect.
As the fight begins over spending reductions, we will hear that state government has already been cut “to the bone.” But a report card on state spending was published last week by the Maine Heritage Policy Center, and it shows that there is still plenty of pork, fat and waste in the state budget. The report is called the “2009 Maine Piglet Book – The Book Augusta Doesn’t Want You to Read.”
In 35 pages, it catalogues many areas where taxpayer dollars have been spent on dubious programs or just plain squandered. It breaks down state spending into terms anyone can understand. In 2008, for example, the state spent more than $13,000 per minute. That works out to nearly $800,000 every hour and about $19 million per day. That is a staggering amount of money for a state with only 1.3 million residents.
Some of the examples of waste are small, such as abuses of the Clean Elections system, whereby candidates for the Legislature take public money to fund their campaigns. One candidate was fined after taking thousands of tax dollars and using the cash to buy camping equipment, a GPS device and a roof rack for his truck. In another case, the state is still trying to collect $17,000 in fines against a so-called campaign consultant who worked for a state Senate candidate. The candidate, according to the Piglet Book, was a “self-described ‘stoner’ and ‘weed farmer.’ ” The consultant was fined for filing fake invoices.
When it comes to serious spending problems, consider Maine’s huge Medicaid system, known as MaineCare. Over the last decade, Maine has expanded this program dramatically, building it up from 154,000 individuals in 1998 to its current enrollment of 270,000 people. That’s 23 percent of the state’s population under age 65, when Medicare kicks in. It’s a noble thing to provide free medical and dental care to poor residents. The problem is that the state has built MaineCare into the second most expensive Medicaid system in the nation. We spend 90 percent more per recipient than the U.S. average, because Maine covers medical services often not covered by other states. Last year, for instance, taxpayers paid $33 million so MaineCare recipients could get free rides to doctors’ appointments. We actually spent $6.6 million on free transportation for heroin addicts when they go to methadone clinics. Some of them take taxis and bill the cab fare to the taxpayers.
Maine’s unsustainable Medicaid enrollment and the multi-billion-dollar cost of the program have created a permanent budget crisis, higher taxes, increased costs for medical services, underpayment of health care providers and hospital debts from years of unpaid Medicaid bills. If Maine had average Medicaid spending and maintained coverage for everyone currently enrolled, state spending would drop by nearly $350 million per year. If we ran our Medicaid system the way most states do, we would have a budget surplus.
The most stunning part of the Piglet Book concerns Maine’s debt burden, which stands at $12.9 billion. The largest chunk is an $8 billion unfunded liability in the pension and health insurance funds for retired teachers and state employees. Somehow, the state will have to come up with that money. Politicians promised a generous retirement package in exchange for political support, hoping they would be long gone from the scene when the debt bomb exploded. Now the bomb has gone off, and Maine taxpayers are paying more than $215 million a year to cover the $3 billion shortfall in the pension fund. The $5 billion shortfall in the health insurance fund has not even been addressed. Republican bills in the last Legislature to start paying off that debt were defeated.
According to the Piglet Book, Maine’s devastating debt burden continues to rise, creating an environment where future generations will struggle under the weight of this monumental obligation. The billions of dollars in interest on the debt that Maine has accrued will haunt Maine taxpayers for years to come. In the Maine Legislature, one party has controlled the House for 35 straight years. They have left a terrible legacy for our children.
This is Representative Kathy Chase. Thank you very much for listening. (And reading)
