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Examples of Programs/Services not Adequately Funded: Department of Administrative and Financial Services
Jennifer Smith, DAFS Communications Director, Jennifer.M.Smith@maine.gov 624-7397
Budgetary reductions in DAFS over the past few years that were prompted, in whole or in significant part, by funding increases to support MaineCare and General Purpose Aid include: 1. Frozen Merit Step, Cost of Living and Longevity (partial) pay increases over a four and one half year period until the modest adjustments that were allowed last year. 2. Multiple reductions in the Value of the Homestead Exemption since its high-water mark in 2005. 3. Last years elimination of the Circuit Breaker program and the replacement of a much less generous Property Tax Fairness Credit last year. 4. Annual reductions in BETR reimbursement. 5. Freezes in the level of funding for the State Employee and Retiree Health Insurance program over a four years period resulting in a visible cost-sharing shift to employees. 6. Three years (2008 2010) of sweeps of modest reserves in the Capital Construction & Improvement Fund at the same time that more than 300 public improvement projects at an estimated cost of $220+ million have gone unfunded. We compromised on a temporary response toward meeting this need by getting a one-time authorization to borrow $4.5 million in last years budget bill. 7. Recent budget curtailment activity that reduced funding for priority contracts, training and staff development and technology investments. 8. Liquor licensing and enforcement activity has been reduced by more than two-thirds in the last 10 years. 9. Lottery marketing authorizations have been flat for many years, while inflation and casino gambling has created new competition for lottery consumers and the associated revenue transfers. 10. The self-funding (from All Other budgets) approach toward covering the cost of a proliferation of position reclassifications over the past several years has had a serious limiting effect on the proper use of those funds.
Department of Labor
Julie Rabinowitz, DOL Communications Director, Julie.Rabinowitz@maine.gov 621-5009 DOL is 97% federally funded, but has been cut to the bone in most areas in which MDOL had historically received General Fund revenue. Those functions cannot be replaced with the federal funds because they are tightly restricted with no flexibility to meet the needs of workers and the unemployed.
The loss for funds include the sweeping this fiscal year of $2 million from the Competitive Skills Scholarship Fund, which is paid by taxes on businesses and designated to provide education and job training to low-income individuals for new careers in high-wage, in-demand jobs. If MDOL had more GF revenue, it could: 1. Implement structural changes to Workforce Delivery Systems, including establishing Industry partnerships and funding the State Workforce Investment Board to drive policy that support job training programs; 2. Reinstate the Maine Enterprise Option, which allows unemployment recipients to start their own small businesses; 3. Reinstate the Governors Training Initiative (with tweaks to the program), which was funded at $3.5 million in 2002 and zero dollars in 2013; 4. Conduct Job Vacancy Surveys to determine what jobs are currently in demand; 5. Expand Apprenticeship programs 6. Incorporate a subsidized wage program to wean people off unemployment and assist the long-term unemployed to get folks back into the job market quicker; 7. Implement Organizational Development initiatives that supported our Zero Based Budgeting efforts from two years ago. 8. The sweeping this fiscal year of $2 million from the Competitive Skills Scholarship Fund, paid by taxes on businesses, that are designated to provide education and job training to low-income individuals for new careers in high-wage, in-demand jobs.
Maine Technology Institute: $1 million returned to the General Fund in FY14 through OPM efforts. These funds would have assisted product development and technology business enhancements in Maine. Maine International Trade Opportunities: Requests for additional funding for Maine International Trade Center were denied resulting in DECD re-assigning one of its 29 positions to the Maine International Trade Center to staff the Maine Northeastern Atlantic
Trade Office. Additional funding would have covered contractual support for MITC; DECD will now consolidate business assistance efforts in Augusta to provide support to this much-needed effort. Evaluation of Economic Development and Research and Development Initiatives: DECD is statutorily required to contract with independent, nonpartisan reviewers to evaluate the programs and functions of the department, as well as the statewide investments in economic development and research and development. Funding to accomplish these evaluations is based on assessments to existing programs. Adequate funding for the economic development incentive program evaluation has never existed until this FY, when only partial funding for the evaluation has been provided. This leaves DECD to cover the remaining costs at the detriment to other economic programs.
Department of Education
Samantha Warren, DOE Communications Director, Samantha.Warren@maine.gov 624-6747 Were it not for the Medicaid program, the state would be better able to fund its share of education funding at 55 percent. It would be able to provide extra financial support to our most struggling schools. Unsustainable Medicaid costs resulted in a $12.7 million curtailment last year and a proposed $10.5 million cut ($9.5 million directly in school funding) this year through the work that OPM is doing. Since those were funds already committed to schools, the deficits that Medicaid is running are preventing the state from keeping its funding promises to Maine schools. Because theyve already budgeted those amounts, its likely theyve had to raise the difference locally or make their own cuts.
Capital equipment needs are set aside for another year. Improving technology to provide for improved efficiencies by both the public and the agency are set aside for another year. These are but just a few examples. Even though Governor LePage proposed and DEP received additional General Fund revenues, they were but a tiny step in the right direction to stem the tide of money being diverted away from environmental protection and used by other agencies.
6. The Capital Improvement fund is a major issue for DPS. Major pieces of equipment and laboratory devices need to be replaced. DPS does not have one penny to do that.
Department of Corrections
Scott Fish, DOC Communications Director, Scott.Fish@maine.gov 287-4386 The loss of General Fund revenue has resulted in a lack of funding for capital items. The DOC has had to self-fund all capital improvement/repairs/requests to all its facilities due to lack of funding. This necessitates drastic changes in program delivery. Since county jails are underfunded by $2 million, inmates are often sent to state facilities. The state must house these inmates without funding to support them.
1. Indirect negative impact due to insufficient technology support from OIT/DAFSalso the result of General Fund reductions in the DAFS budget. 2. Indirect negative impact on DPFR agencies resulting from freezing merit and longevity pay. State employees gain expertise in a particular area, then leave for higher-paying positions in the private sector. DPFR agencies have become training facilities for financial institutions and insurance companies regulated by Department agencies.
Department of Transportation
Ted Talbot, DOT Communications Director, Ted.W.Talbot@maine.gov 215-9297 MaineDOT does not receive any General Fund appropriations. It has been zeroed out over the years.* However, from a longer-term perspective, the growth of General Fund programs most notably those at DHHS has had the effect of making transportation a lower priority in Maine over time. In 1975, Highway Fund revenues represented over 25% of revenues collected by the State (Highway Fund and General Fund). In FY 2013, this percentage is less than 10%. About two-thirds of all MaineDOT expenditures are capital-related. To preserve these capital investment levels, MaineDOT has undertaken numerous efficiency efforts. For example, over the last several years, MaineDOT has reduced its workforce by about 20%, as measured by the number of paychecks issued.
* For FY14-FY 15 biennium, MaineDOT receives its funding from the following sources: 45% from traditional Highway Fund revenues (fuel taxes, registration and title fees, etc.); 34% from federal funds; 17% from bonds proceeds; and 4% from other sources.