AUGUSTA – Republican lawmakers on Thursday presented a plan they say could put millions of dollars toward highway and bridge repairs without requiring the state to borrow money.
Economic forecasts indicate that Maine could finish the year with a sizeable surplus, somewhere between $45 million and $60 million.
The Republican proposal would dedicate every dime – regardless of what the final amount turns out to be – to transportation.
On the downside, it would also slow the state’s efforts to pay down other long-term obligations.
“It’s using today’s dollars to solve today’s problems,” said House Assistant Minority Leader Josh Tardy, R-Newport. “This is an invitation to the Democratic leadership … to look at solving today’s problems with today’s resources.”
Democratic leaders declined the invitation, calling the plan fiscally irresponsible and a hollow promise designed more to score political points than to address the state’s pressing transportation needs.
“I find it ironic that at the same time we’re imposing financial discipline on ourselves, the Republican proposal … spends money that we don’t have,” Richardson said.
The Republican plan comes in response to a Democratic initiative that has won initial approval in the Senate, but faces an uncertain future in the House.
Senate Democrats would send to voters for approval a $60 million transportation bond and eliminate an increase in the fuel tax scheduled to take effect in July, saving motorists less than a penny on the gallon but costing the state nearly $8 million in road money.
“There is no need to borrow and dig ourselves deeper in debt when we suddenly have a surplus,” said House Minority Leader David Bowles, R-Sanford.
Rep. Boyd Marley, D-Portland and the House chairman of the Transportation Committee, heartily supports the bond as a way to prop up the state’s teetering roads and bridges.
“The Republicans are making empty promises. They’re saying â€˜if,'” Marley said. “We don’t know how much there will actually be. I think it’s just about politics, to make themselves look like they have an alternative plan.”
During negotiations over a supplemental budget earlier this session, the leadership of both parties agreed that no bond package would be sent to voters this year. The concession from Democrats, who generally favor bonding to pay for infrastructure improvements, was one of the keys to the budget passing with nearly unanimous support.
In addition, the budget contained $30 million for transportation, half of which is set to come from the General Fund.
Leaders on both sides of the aisle, save Assistant Senate Majority Leader Kenneth Gagnon, D-Waterville, agree that the Senate Democratic plan breaks the deal. It passed in the Senate without the support of Senate President Beth Edmonds or other Democratic leaders and only with the help of two Republican defectors.
In the House, Richardson and Majority Leader Glenn Cummings, D-Portland, say they won’t support the bonds and will work for their defeat because they gave their word as part of budget negotiations.
If the members in this body vote as they have before, Richardson said, the bonds are not going to pass.
“My word is my bond,” Richardson said. “I’m living up to the deal. A deal is a deal. From where I sit, the bonds are not going to pass. They’re a bad idea.”
Despite the straightforwardness of the Republican proposal, it also contains significant tradeoffs. The supplemental budget contains a formula – agreed to by both parties – that would dictate how any surplus would be spent.
Fifty-five percent would go into reserves, 20 percent would be used to buy down the state’s unfunded pension liability, 15 percent to pay for the unfunded post-retirement health benefits of workers and 10 percent for capital repairs and improvements.
The pension liability stands at about $3 billion and the health care at about $1.5 billion.
Paying down those obligations has become a rallying cry for Republicans. Bowles said he sees the apparent conflict.
“Any time you make a choice in terms of where dollars are going to go, there’s an offset in some other area. We’re making a choice here, and we’re making a choice here that we think Maine people will support,” Bowles said. “Right now, the more important thing is to do something about our highway infrastructure.”
The assumption during budget negotiations was that any surplus would go through the formula, said state Sen. Peggy Rotundo, D-Lewiston, who was one of the chief architects of the budget compromise as the chair of the Appropriations Committee.
“To take money away from that weakens the financial stability of the state,” Rotundo said. “We’re eager to save this money. It’s a very fiscally sound and responsible plan.”