Governor Releases Plan to Close Growing Budget Gap

On Wednesday (3/5), Governor Baldacci released his most recent plan to address the growing budget gap. Late last month the state’s Revenue Forecasting Committee met and reduced their projection of state revenues by an additional $95 million. That action brought the state budget shortfall to nearly $200 million. The governor has proposed to eliminate over 70 state jobs, 20 of which will be administrative and management positions within the Department of Health and Human Services (DHHS). He is also proposing to further cap enrollment in a MaineCare program which gives free health care to non-disabled, childless adults. The program is not federally mandated. The revisions to the budget target DHHS for nearly $27.5 million more in reductions. The governor has also proposed reducing General Purpose Aid to schools by $34.1 million. Part of the savings will be realized by extending the ramp-up to 55 percent state funding for K-12 education from four years to five years. The governor’s plan did not raise broad-based taxes and did not draw from the state’s rainy day fund reserves. The proposal does raise $117,000 in new revenue through fee increases and relies upon $8.2 million in one-time money to fill the budget gap.