We hope Republicans in the Maine Legislature have used the past four days to reconsider their opposition to an $85 million bond package that represents an important investment in the state’s future.
Negotiations broke down last Wednesday when it became clear no Republicans in the Senate were willing to pass the proposal, which left it four votes shy of moving forward after having passed the House.
The plan includes $5 million to purchase the St. Lawrence and Atlantic rail line from Yarmouth to Auburn to enhance freight rail service and position our area for passenger rail service. So it is important to L-A’s future.
But our support of the bond package is more than parochial. It contains money for critical economic development issues across the state, including nearly $35 million for highway maintenance and $7 million for the deep-water Ocean Gateway project in Portland harbor to accommodate large cruise ships, freighters and tankers.
Several of the items on the list would draw down significant federal dollars that would be spent putting Mainers to work and improving our communities and environment.
For instance, a $2 million bond investment in drinking water facilities would attract $10 million in federal matching money. A $3.2 million investment in wastewater treatment facility construction would fetch $16 million from the feds.
A $5 million investment in Maine wind energy projects would pull in $24.5 million federal dollars.
That’s more than $50 million in outside dollars that Maine would receive for a $12 million investment, money that will be left on the table if the bond proposal fails.
The most controversial part of the plan has become the proposed purchasefor $17 million of 240 miles of rail line currently owned by the Montreal, Maine and Atlantic Railway.
The railroad has 22 industrial customers spread between Millinocket and Madawaska that depend on the line, providing between 700 and 1,000 jobs.
The current owner bought the line for $40 million in 2004 and, because of hefty debt service, it has become unprofitable during this economic downturn.
The $17 million, according to state officials, represents nothing more than the scrap value of the line minus several million dollars the company already owes the state.
Republicans are rightly concerned that the entire bond proposal will generate $19 million in interest payments over its life, which will simply contribute to the next budget crisis.
But Maine is also retiring $168 million in debt in this biennium. Even when combined with previously authorized debt waiting to be issued, Maine will be retiring $5 million more debt than it is issuing.
What’s more, the $85 million will help save or create nearly 3,000 jobs and generate business that should help offset the state’s interest payments over time.
That is economic activity — jobs, construction materials, tourist visits, federal dollars — that might be lost without this investment.
Maine is 28th among states for state debt as a percentage of personal income, and it is 33rd in debt per capita: $743 per person compared to a national average of $865. So it is not as if we have been borrowing wildly.
Maine will face more operating budget and revenue issues going forward.
We should not, however, solve those problems by shortchanging capital investments in our future.