HAVING CUT, NOW LOOK

Maine’s budget forecast looked slightly less dismal this month, providing an opportunity to do something besides make desperate cuts to fill budget holes. The year-end numbers put Maine about $43 million up in fiscal year 2005, a tiny amount compared with the sudden surpluses other states are experiencing nationwide, but an important chance to spend a small portion of whatever is left over to figure out how to spend total revenues more wisely.

If any outcome is certain from the last couple of weeks of more than $100 million in cuts to balance the state budget, it is that lawmakers, in some areas, did it badly. Given the rush and the need for revenue, there was no way of avoiding such an outcome. Compounding that, lawmakers learned mid-session that Maine spends more generously in some areas than perhaps it should. Reports on administration for both K-12 education and higher education show Maine well above the national average in a state with an average income that is below it. The questions these two conditions raise are complicated but well worth answering.

Specifically, Maine should figure out how to move toward one of the modified forms of zero-based budgeting as other states are doing to allow themselves top-to-bottom reviews of department services and performance. This is a lengthy but necessary process to avoid making the crude across-the-board cuts considered by lawmakers this spring. Traditional zero-based budgeting requires all programs to be justified during each review – budget committees start at zero for each program and fund only those that can be justified. This time-consuming exercise is not one Maine should want to use with every budget cycle nor does it necessarily need to begin with zero. But lawmakers need a better sense of whether Maine is getting good value for its taxes, how the agencies’ delivery of services compares with private entities and whether the state needs to provide the services for which it is currently paying.

Second, can the state review the administration costs for education and provide a series of guideposts for K-12 and a more direct demand for savings within higher education? The K-12 administration costs are about 50 percent higher here than elsewhere, in part because Maine has many small schools but also because of habit.

Maine is accustomed, for instance, to having 152 superintendents, and a serious reduction in this number is threatening to local control. Higher and higher taxes, of course, are threatening to local anything. Maine has learned there are a lot of possible money-saving steps between the status quo and closing all its small schools. The state would save money by spending a little on making the case for these alternatives.

Similarly, the University of Maine System administration and on the individual universities should be reviewed for efficiency and effectiveness. A news story the other day pointed out that among the cuts made by lawmakers, $1 million a year was taken from UMS. To the extent that this can come out of administration and not classrooms, it should. That will take, at the very least, an interest by the administration.

Lawmakers may be thoroughly tired of thinking about the state budget after months of debating it but there is no other time to begin making reforms to the process. This wouldn’t take much of the forecasted surplus and it could save tens of millions while improving service every year afterward.