Governor Mills wants to boost rainy day fund

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AUGUSTA, Maine (AP) Maine is expected to see tens of millions in extra state revenues and the governor wants to put $20 million of such money into the state's rainy day fund.

Democratic Gov. Janet Mills said Tuesday she also wants to direct $15 million for Riverview Psychiatric Center's debt to the federal government, $5.5 million to opioid programs and $20 million to school repairs.

Mills originally proposed an $8 billion, two-year budget.

That's an 11 percent increase over the two-year $7.2 billion budget ending June.

Revenue forecasters recently estimated revenues will exceed previous estimates by $66.7 million through June. Maine could see an additional $54 million through 2023.

Republicans criticized the budget as too high of a starting point. Some liberal groups urge lawmakers to repeal tax cuts benefiting the wealthy.

Full release from the Governor's Office:

"Augusta, MAINE – Governor Janet Mills today released her administration’s 2019-2020 Biennial Budget Change Package. The Change Package – a legislative vehicle routinely used to amend the biennial budget proposal – prioritizes investments needed to reduce unsustainable caseloads in Maine’s child welfare system, to repair Maine’s decaying school infrastructure, to responsibly pay off the previous administration’s debt to the federal government, and to build the state’s budget resiliency by adding to the rainy-day fund.

“This change package prioritizes pressing investments needed to protect children’s safety, to repair crumbling schools, to pay back the previous administration’s debt, and to save money in the event of an economic downturn,” said Governor Mills. “These changes address critical needs, reflect decisions made in the first four months, and build on my pragmatic budget proposal to deliver a solid economic foundation and the initiatives Maine people want and our state needs. I look forward to working with lawmakers as the budget process begins in earnest.”

“This represents a needed down payment toward the safety of Maine children, an investment in our mental health system, and a fresh start for Riverview Psychiatric Center,” said Health and Human Services Commissioner Jeanne Lambrew. “Improving the health and wellbeing of Maine people must remain at the forefront throughout the budget process, and we appreciate the Legislature’s thoughtful consideration of this proposal.”

More specifically, the 2019-2020 Biennial Budget Change Package will:

Bolster Maine’s child welfare and mental health systems through:

 Hiring of 62 new staff for the Office of Child and Family Services to keep Maine’s children safe, an 8 percent increase in staff and a critical down payment to reduce caseloads. This includes 43 caseworker staff, 6 background check unit staff, and 13 intake staff, all of whom will work to help prevent abuse, neglect and unhealthy experiences among our children.

 Adding another $5.5 million from the Fund for a Healthy Maine for the Governor’s opioid response, with an emphasis on school and community-based prevention programs to help youth at risk of substance use and mental health disorders – a goal of the Children’s Cabinet.

 Creating 48 positions – rather than contracting them out – to staff Dorothea Dix Psychiatric Center’s new unit, which will serve all people in need of acute psychiatric care, including those deemed incompetent to stand trial and transferred by jails. Governor Mills announced in February that the nearly-completed facility will be an option for inpatient-level care instead of a step-down facility run by private contractors, as part of a broader plan to also expand outpatient mental health services in Maine. The budget request in the Change Package is the same as previously announced, and less annually from the General Fund than what the previous administration requested.

Invest in Maine’s decaying school infrastructure by:

 Dedicating $20 million in one-time revenue into the School Revolving Renovation Fund. The fund, which provides no-interest loans for school repairs across the state, has been depleted over the years from an initial $200 million under then-Governor Angus King to less than $3 million now. Meanwhile, Maine schools have aged and many have become dilapidated.
“School infrastructure across the state is in critical need of repair, renovation, and reconstruction,” said Education Commissioner Pender Makin. “Our program for school construction projects is stretched far beyond its capacity, and the waiting list is decades long. The revolving renovation fund has proven to be extremely helpful and cost effective, enabling schools to address a variety of health and safety issues in a timely and efficient manner, and replenishing this fund has been a priority.”

Pay off the last administration’s debt to the federal government by:

 Adding $15 million in one-time revenue to the remaining $51 million in set-aside funds to fully and finally pay off the previous administration’s debt for Riverview Psychiatric Center. Because of its failure to ensure high-quality care, Riverview was decertified and the previous administration accumulated a total debt of nearly $80 million to the federal government to continue its operations during its decertification. The current administration will use this new funding, plus the money set aside by the previous legislature on a bipartisan basis – including the Republicans in both Senate and House leadership – to pay off the debt in a timely manner, avoiding an added cost to the state through interest charged.

Fortify the state’s budget resiliency by:

 Saving $20 million in the state’s Budget Stabilization Fund. Governor Mills’ original budget proposal protects the budget stabilization fund and, with this change package, adds $20 million to it to protect the state against uncertain economic headwinds.

The change package comes in the wake of a recent report by the Maine Revenue Forecasting Committee that projected an increase of $120.5 million in general fund revenue. Changes to the current fiscal year, which concludes on June 30, 2019, include a positive revision of $66.7 million. The forecast for the 2020-2021 biennium, which is the revenue period covering Governor Mills’ first biennial budget, has been revised upward by $20.7 million. In addition to increases to the current fiscal year and forthcoming biennium, the Committee also revised the General Fund forecast for the 2022-2023 biennium upward by $33.1 million.

After these adjustments and other technical changes, Governor Mills’ budget for FY 20-21 biennium leaves $16.5 million available for the Legislature’s consideration and remains substantially under the projection for the FY 22-23 biennium."