Maine spends more than $200 million a year in business incentives and tax credits without a clear sense of the overall benefits of this effort. After a state study of this situation last year, the Legislature and administration have offered ways to solve this deficiency. The ideas are welcome, but they will be useful only if the public ends up with an improved understanding of how its tax money is spent.

The problem of a lack of analysis in Maine’s economic development programs was raised by the Office of Program Evaluation and Government Accountability, which found Maine lacked the means to determine which of its programs were effective compared with others and which were simply wasteful. The OPEGA report did not conclude that Maine was spending its tax money badly, but that it didn’t have enough information to know or to determine whether shifting the money it did spend could produce a better result.

For instance, it found that a quarter of the programs had no clearly stated public purpose, a quarter did not have specific objectives, and a third did not regularly report their performance. Although some of the programs and the state departments that oversee them do report to the Legislature, they often count the same jobs and same revenue growth, therefore double (or more) counting the benefits.

The OPEGA report concluded that Maine should define what it means by economic development, judge its programs for efficiency and effectiveness, coordinate those programs statewide, clarify program requirements and accountability and collect data to improve transparency and accuracy of any development claims made. It is a sensible agenda but a huge one.

LD 1163, sponsored by Sen. Richard Rosen, R-Bucksport, would begin to do that. In response, the Department of Economic and Community Development offered its own version, which would focus on gathering background data and establish annual evaluations. Whatever they end up passing, however, should contain three elements: Reporting should be consistent across programs so they can be compared; research into these programs should seek a causal link between the incentive and improved economic health; and any conclusions should be written for the general public and made widely available.

It’s also worth considering how effective these development programs are compared with other business-related factors. Todd Gabe, an associate professor in the School of Economics at the University of Maine, wrote recently on these pages that his work showed that when companies were asked about economic considerations, they were more likely to cite utility costs, availability of qualified employees and quality of life more often than they did incentives and tax credits.

The Legislature cannot hope to assemble a comprehensive bill on this issue in a single session, but it can begin a multiyear process of seeking, with hard data, the most economically beneficial programs for Maine. It’s a major challenge but one that is seriously overdue.