By Rep. Mike Thibodeau
In October, I wrote a column about the “2009 Maine Piglet Book,” a guide to wasteful and irresponsible spending by Maine’s state government. The book exposed the shocking debt that Maine has amassed – nearly $13 billion. It also examined the staggering cost of Maine’s Medicaid system, known as MaineCare, ranked as the second most expensive Medicaid program in the United States. (As part of MaineCare, taxpayers spend $6.6 million every year to give heroin addicts free rides to methadone clinics.)
The Piglet book was compiled by two groups focused on the commonsense virtues of sustainable government spending – the Maine Heritage Policy Center and the Washington-based Citizens Against Government Waste. Its revelations are now more important than ever. In recent months, revenues to state government have fallen so drastically that the Legislature, when it convenes in January, will face the grinding chore of slashing the new $5.8 billion biennial budget by some $400 million.
Cuts of that magnitude will have to come primarily from the two sectors that account for about 80 percent of the budget, namely public education and health and human services. Municipalities will face heavy pressure to raise property taxes to cushion the blow to schools.
In an economy like this, state government should be scouring every fiscal crevice to eliminate unnecessary spending. Judging by the Piglet book, however, plenty of spending goes unexamined, including hundreds of millions of dollars in “economic development” programs.
In 2005, the Legislature created a non-partisan watchdog agency called OPEGA – the Office of Program Evaluation and Government Accountability. Since its inception, OPEGA has turned a spotlight on state government, pointing out areas of waste, inefficiency and financial mismanagement. We know the tiny agency has been effective because Augusta’s entrenched elites have tried to shut it down. They hate to see their pet programs exposed.
A major OPEGA investigation looked into the state’s 46 economic development programs that are stashed throughout the bureaucracy. We’re talking real money here. From 2003 to 2005 – the three years under investigation – these 46 programs spent $602 million. Administrative costs added another $22 million in only 21 of the programs.
Astoundingly, OPEGA’s risk assessment stated that “the majority of the programs lack standard controls necessary for performance evaluation.” OPEGA also discovered that there is “no meaningful effort to coordinate” operations between the programs. Apparently, nobody even asks if the programs are needed or what they actually do. Once established, they become permanent, steadily siphoning off tax dollars year after year.
Taxpayers should be outraged at a state government that spends some $200 million a year on economic development programs that seemingly exist in a bureaucratic black hole, immune from accountability and exempt from even the most basic performance standards.
State government salaries also deserve a close look, and the Piglet book provides some interesting data. As the CEO of the state, Maine’s governor makes $70,000 a year, which is reasonable considering that our median household income is about $45,000.
Most folks would expect the governor to be at the top of the state government pay scale; but in 2008 more than 1,450 state employees earned more than the chief executive. Fifty-four executive branch workers knocked down more than $100,000, including two people who oversee the failed Dirigo Health program, which itself has cost taxpayers more than $150 million. Not surprisingly, nine of the 10 highest salaries in the executive branch can be found at the enormous and incomprehensible Department of Health and Human Services.
Another area ripe for potential savings is overtime pay for state workers. In 2008, 512 of them took home more than $10,000 each in overtime. Nineteen of them made more than $30,000; and one fortunate individual made $60,000.
When tax cuts are proposed in Maine, opponents quickly say that government spending has already been cut “to the bone.” The state writes checks that total hundreds of millions of dollars every year to businesses and people. Are we getting a fair value? In 2007, the state spent $1.515 million on “meals and gratuities”; and in 2008, it spent $749,985 on “entertainment and catering services.”
The budget’s “miscellaneous” category provides no details, so taxpayers don’t know precisely what is included. But in 2007, the state reported paying $1.195 million for miscellaneous expenses; and in 2008 it reported spending more than $127 million for “miscellaneous professional fees and services.”
You’ve probably never heard of the Government Facilities Authority (GFA); but in this two-year budget cycle, Maine taxpayers will fork over $39.4 million to service the $192 million worth of debt the GFA has accumulated. The GFA was created by the Legislature in 1997 so that lawmakers could borrow money for government building projects without voter approval. Normal borrowing – bonding – requires a two-thirds vote of the Legislature and approval by the voters. The GFA represents an end-run around the traditional system of taking on debt.
As the Piglet book says: “This is what happens when the Legislature frees itself from public oversight. One can expect that unless the GFA is abolished, this kind of constitutionally questionable borrowing, in the name of Mainers but without the vote of Mainers, will continue.”
Keep some of these examples in mind when school funding is slashed and you end up bearing the burden in the form of higher property taxes.
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State Rep. Mike Thibodeau (R-Winterport) serves on the Legislature’s Labor Committee and the Utilities and Energy Committee