The Sun Journal’s Sept. 1 editorial (“Facts show state spending really is down”) took umbrage with my critique of state government spending increases because federal funds received by the state were included. The editorial seemed to suggest that federal funds are not real dollars and should not be considered as spending or the concern of the governor and Legislature.
While federal spending these days does seem to be unrealistic, the dollars, nonetheless, are real. It would be irresponsible for the governor and Legislature to ignore their accountability to effectively manage and audit those expenditures. Contrary to the political posturing that encourages people to believe that state government has made Draconian cuts in spending, any examination of the facts show otherwise.
Let’s look at what has occurred in the past eight years.
In 2002, the General Fund expenditures were $2.584 billion. In 2010, General Fund expenditures were $2.866 billion ($283 million more per year than 2002). During the eight-year time-frame, General Fund expenditures peaked at $3.084 billion in 2008 ($500 million more per year than in 2002). While 2010 General Fund expenditures were lower than the peak years, spending was still significantly greater than 2002.
The editorial correctly identified that many of the state budget “cuts” were simply a pass-along to other levels of government. The “cuts” made to the General Fund expenditures should be more appropriately described as “cost-shifts.”
That cost-shifting tactic can best be seen in the costs passed on to property taxpayers via the reductions made to municipal revenue-sharing and Homestead Exemption, in addition to the default on the 55 percent K-12 education funding commitment.
In addition, health care providers also felt the impact through unilateral reductions in compensation rates for services provided through the state-run MaineCare health care program.
A closer look at other special revenue fund expenditures shows an even more significant spending increase. In 2002, expenditures were at $826 million. By 2010, spending had increased to $1.418 billion ($592 million more per year than in 2002).
While the editorial was correct in highlighting that federal funds had increased significantly in 2010 as the stimulus money flowed into state coffers, it is important to recognize that the other state spending categories also have increased significantly during the eight-year period.
In the final analysis, the money that state government spends comes from the same source: taxes and fees. The facts show that state government spent $7.726 billion in 2010 as compared to $5.393 billion in 2002. By any measure, that is a significant spending increase.
State Rep. Ken Fletcher, Winslow