YES ON QUESTION 3

Do you favor amending the Constitution of Maine to allow the State to issue short-term debt in limited amounts that must be repaid with federal transportation funds within 12 months to facilitate the development of highways, bridges and other transportation projects?

The constitution of Maine limits the total amount state government can borrow without voter approval to $2 million, with a few specific exceptions for emergencies. This amendment is not a bond issue, nor is it a request for additional money. It might, however, help out in an emergency.

The polite way to describe this constitutional amendment is as a cash-flow management tool. The state pays for transportation projects eligible for federal funds in advance. Delays in reimbursement can delay future projects; this has the potential to cause real problems in a state with a short construction season. With this amendment, the state Department of Transportation will be able to borrow in advance of that reimbursement through Grant Anticipation Notes, in the same way the state and municipalities now can borrow in advance of tax payments through Tax Anticipation Notes.

The blunt way to describe it is as a defense against the increasing tendency of Congress to politicize everything, with appropriations bills routinely held up for entirely partisan reasons. So far, continuing resolutions have kept the wheels of government turning; it is almost inevitable that continuing resolutions will become politicized. With the entire transportation bill up for reauthorization next year, the opportunity for political mischief is great, as is the potential for real harm to states with short construction seasons. If nothing else, this provision will allow MDOT to spread bids out during the year, enabling it to take of advantage of the lower prices available in slack construction periods.

This amendment limits the borrowing by MDOT to one-half of the federal transportation disbursement to Maine for the previous year, a sufficient protection against incurring debt that cannot be repaid. The 12-month repayment requirement will prevent MDOT from piling up debt into future years. This cash-flow management tool may never be needed, but with Congress the way it is, it could come in handy.