AUGUSTA – Barring any mail delivery problems, an estimated 119,000 Mainers already have received a check for $400 from the U.S. Treasury as part of the $350 billion tax cut Congress passed earlier this year. The early payment of the increased child care tax credit was designed to stimulate the economy, but economists disagree over how effective it will be.

“I think there is bound to be an impact,” said University of Maine economics professor David Wihry. “I think the question is how much.”

Wihry said the tax cut, implemented through the increase in the child care tax credit, is a “classic Keynesian” approach to stimulating the economy by seeking to boost consumer spending. But, he said, just how much of the money will be used for consumer purchases is far from certain.

Bates College economics professor James Hughes thinks “there is good news and bad news in this cut.” He said getting the extra cash would be good news for a lot of people, but he doubts the tax reduction will stimulate the economy as much as Congress intended.

Both said the $47.6 million coming into the state is a significant amount of money, but how much of the cash is actually spent on goods and services will determine the economic impact.

“I’m going to put it right into my daughter’s savings account,” said Kara Ryan of Levant as she shopped at the Bangor Mall last week. While that certainly is good for Ryan’s daughter, economists agree that putting the tax credit money into savings will not help spur the economy. Nor will paying down credit card debt or using the extra cash to pay for usual expenses.

“We haven’t planned anything yet, but we’ll probably spend it,” said Sandra Cookson of Glenburn. “We are building a covered porch on our house, so we will probably put some toward that.”

That sort of expenditure would help bolster the economy, the economists agreed. Some of the money to buy lumber, for example, will stay in Maine. Those dollars will circulate through the marketplace more frequently and have a bigger impact than many consumer purchases, the experts said.

The goods being bought also need to be domestically produced to have the greatest impact.

“Buying a new TV or something like that may not even help the national economy that much,” said University of Southern Maine economics professor Michael Hillard. “Most are manufactured overseas.”

Hillard wasn’t so sure much of the money would be spent on goods anyway.

“If you look at the studies of the 2001 tax rebates, a lot of the money from that $300 check went to savings or to pay down credit card debt and I think that will happen this time because the people that would have most likely spent the check will not receive one.”

Unlike the tax cut approved by Congress to stimulate the economy in 2001, this stimulus package was limited to families that claimed the child care credit on last year’s income tax return. Hillard said this round of checks would not go to those families that made between $10,500 and $26,625 last year.

“Those are the families struggling to provide adequate child care,” said Jessica Connelly, an economics professor and director of women’s studies at Bowdoin College. “They would be the ones that would spend the check because they are so poor.”

Connelly said she has not studied Maine’s economy specifically, so was not comfortable in commenting on the potential impact of the payments on the state’s economy. She is concerned about the equity issue, however, with Congress giving the cut to some families, but not those in most need of help.

The other economists interviewed for this story agreed. If the program had included the low-income group, it would have meant more than $8 million in additional payments coming into the state. And the economists believe that money would have been spent.

Members of Maine’s congressional delegation all supported including the lower-income families in the program. The Senate passed such a measure, but the House recessed until after Labor Day without acting on it.

“Working families and many military heroes making between $10,500 and about $26,000 will not benefit from this tax relief,” Sen. Olympia Snowe said last month. “We should not be leaving out millions of families who are struggling to raise children. No tax relief effort can be considered complete as long as this yawning gap exists for hardworking Americans.”

Snowe said there would be efforts in Congress to expand the program after the summer recess.

Hillard said if Congress wanted to stimulate the economy it would have been more effective to spend the money on any number of public works programs, or in additional aid to the states. Both Wihry and Hughes agreed.

Hillard noted many states have had to cut back spending and many have raised taxes in the current recession. He said the stimulus impact of tax cuts at the federal level would be diminished by increases in state and local taxes.

Jennifer Gundersen of the Bangor Daily News staff contributed to this report.