Bonds critical for the people of Maine

A bond package has been proposed, a compromise has been struck, but the work is far from over. We have worked tirelessly on crafting this bond package since the session began back in December, and many times it felt as though we were pushing a granite boulder up Mount Katahdin. While many of us have much to grumble about, there seems to be a broad consensus that a bond package is vital for the people of Maine.

Upon being sworn in to the 122nd legislative session in December, I promised the people of my district and the people of Maine, as did many of my Democratic and Republican colleagues alike, to earnestly assume a seat at the table and negotiate a bond proposal to be presented to the voters of Maine. Bonds require two-thirds approval of both the House of Representatives and the Senate, ensuring that negotiations, concessions and a willingness to work together are tightly embedded in each bond package that is crafted. I believe the people of Maine deserve to cast their vote up or down on a bond package and we can not deny them yet again this year the opportunity to cast this critical vote.

The $83 million bond package presented to the public this week is a far cry from the original proposal of $197 million presented to the Legislature by the governor earlier this year. Without question, the $197 million bond package would have better served the people of Maine, and I still believe it is the way to go. The $83 million reflects a direct compromise between Democratic and Republican leadership, and their willingness to come together on behalf of their caucuses is commendable.

Since 1999, Maine has bonded in accordance with the “5 percent rule,” which states that no more than 5 percent of the state’s annual general fund revenues may be used to pay down debt service. This package of $83 million falls way below the 5 percent rule as did the governor’s original proposal. Maine is capable of bonding anywhere between $255 and $370 million to still fall within the required 5 percent range.

We have been very aggressive in paying down spending on previously authorized bond funds, and we have retired $52 million more debt than we issued in 2000 to 2004. Maine ranks 36th in the nation for tax supported debt per capita. This is 30 percent less than the national average. Few would argue that 36th is a pretty good place to be. We could bond more, and we should bond more, but without our Republican colleagues on board, a larger bond package simply is not possible.

The incredibly reduced amount of our current proposed bond package, $83 million, does a disservice to the people of our state, but not nearly as much of a disservice as no bond package. We cannot allow another year to pass without serious investments in our state’s future. Investments must be made that will carry us through to the new economy – investments in our roads, our schools and institutes of higher learning, our environment, and most importantly a substantial investment in job creation.

Many people have indicated that in this current time of uncertainty, while we all wait for news from the Base Realignment and Closure commission, enacting a bond package is not in Maine’s best interest. This could not be farther from the truth. In this time of uncertainty is precisely when we need to invest in our future – in economic development, in research and development, and in job creation. If not now, when? Many of these R&D potentially draw down federal funds at a 10 to 1 match.

With the first year of college right around the corner for many students, endless questions seem to bog down students and parents alike. How will they pay for it all? Where will the money come from? For many students, without loans, a higher degree is simply unattainable, and few financial aide advisors would try to dissuade students from taking out student loans to pay for college. The loans are viewed as an investment, and the debt is repaid over time from the return in the investment – the better-paying job that they are able to obtain with an advanced degree.

Bonds are an investment in the future of Maine. They are repaid over time from the increase in tax revenues generated as a direct result of enactment of the bonds. We cannot afford to let this invest in the state of Maine pass us by.

The work is far from over. The current compromise package of $83 million is now in the hands of the Legislature’s Appropriations Committee. All caucuses, House and Senate Democrats, House and Senate Republicans, have weighed in on what they think is the best scenario, and the process is moving full steam ahead.

While this package is not as much as many of us had hoped for, I included, and while I am committed to enacting a bond package this session, I will also continue to advocate for a larger package. We owe it to the people of Maine.

Joe Perry, D-Penobscot, represents Senate District 32, the communities of Bangor, his hometown, and Hermon. He is currently serving his first term in the Senate, previously serving for eight years in the House of Representatives. He is the Senate chair of the Joint Standing Committee on Taxation.