The Maine Wire
  • News
  • Commentary
  • Maine Wire TV
  • About
  • Contact
Facebook Twitter Instagram
Trending News
  • Investigation Launched Into Alleged ‘Inappropriate Relationship’ Between Bangor High Staff Member and Student
  • Press Herald Quotes Fake “Small Business Coalition” Without Disclosing Funding Ties to Liberal Dark Money Groups
  • Maine’s Media Ignores Taxpayer-Funded Community College Free Rides for Noncitizens
  • Maine Public School Officials Used Government Resources to Advocate Against Ban on Obscene Books, Emails Show
  • Lawmakers Seek to Broaden Maine’s “Clean” Election Act
  • Appeals Court Rules Against Gov. Mills in Case Challenging Vaccine Mandate for Health Care Workers
  • State House: Pro-lifers rally against Mills’ unlimited abortion bill; left-wing groups push paid leave payroll tax
  • Maine Recruiting Noncitizens for Free Community College Under Gov. Mills “Free College” Plan
Facebook Twitter Instagram
The Maine Wire
Login
Tuesday, May 30
  • News
  • Commentary
  • Maine Wire TV
  • About
  • Contact
The Maine Wire
Home » News » LePage Rightly Moves to Increase Maine’s Rainy Day Fund
Commentary

LePage Rightly Moves to Increase Maine’s Rainy Day Fund

Patrick MarvinBy Patrick MarvinFebruary 22, 2016Updated:February 22, 2016No Comments3 Mins Read
Facebook Twitter Email LinkedIn Reddit
Share
Facebook Twitter LinkedIn Email

Today, Governor Paul LePage announced he will introduce common-sense legislation that will help grow Maine’s rainy day fund and promote financial stability.

This announcement by LePage came about because, according to the Maine Revenue Forecasting Committee, Maine is forecasted to collect $72.7 million in excess General Fund revenue from now until June 2017.

LePage is therefore proposing to transfer this extra money to the Budget Stabilization Fund, commonly called the “rainy day fund.” The rainy day fund is used to cover budget shortfalls and to respond to financial crises, and is a key component of a fiscally responsible state government.

So what does this mean?

First, the income tax cuts enacted by LePage are clearly working. Maine’s economy is continuing to grow, and cutting the income tax rate has not had any negative effect on Maine’s ability to fund its state government, as it is collecting more money than anticipated.

Second, this practical move by LePage would ensure Maine has a real chance at long-term financial stability.

The current balance of Maine’s rainy day fund is just $111 million, which is enough to fund Maine’s state government for only 8 days.

This $111 million represents a mere 3% of all the money that is collected through Maine’s general fund every year. However, the Federal Reserve of Boston recommends that states have a reserve fund that is between 10 percent and 15 percent of their annual spending.

A recent report even highlighted Maine’s poor financial footing, and noted that Maine is ranked just 42nd in the nation for fiscal health.

But the LePage bill would be a big step towards a stable and responsible state government. It would ensure that this extra $72.7 million is saved in a responsible manner and not put to waste, or spent on additional and unnecessary projects.

“The Maine Legislature has shown that they cannot be trusted to exercise fiscal restraint,” said Governor LePage when announcing this legislation.

“In June, they passed a budget that increased spending by more than $300 million, and now, as part of our administration’s tax conformity proposal, a radical group of socialist Democrats has recklessly proposed raiding the fund of more than $20 million.”

If LePage’s bill passes, the balance of the rainy day fund would increase from $111 million to $178 million at the end of the current fiscal year, and to $183 million by the end of 2017.

Maine lawmakers would clearly be wise to support this fiscally responsible measure and prioritize Maine’s long-term financial health. They should prepare for the future and continue to grow Maine’s rainy day fund, and get behind LePage’s efforts.

Featured general fund Governor LePage Opinion rainy day fund Taxes
Previous ArticleMarxist Peoples Alliance Sparks Hostage Crisis at Statehouse
Next Article “Full Employment” is a Faux Reality in Maine
Patrick Marvin

Patrick Marvin is a former Policy Analyst for The Maine Heritage Policy Center. He holds a Masters Degree from the University of New Hampshire, and has an extensive background in analysis and research.

Related Posts

Investigation Launched Into Alleged ‘Inappropriate Relationship’ Between Bangor High Staff Member and Student

May 26, 2023

Press Herald Quotes Fake “Small Business Coalition” Without Disclosing Funding Ties to Liberal Dark Money Groups

May 26, 2023

Maine’s Media Ignores Taxpayer-Funded Community College Free Rides for Noncitizens

May 26, 2023

Leave A Reply

Recent News

Investigation Launched Into Alleged ‘Inappropriate Relationship’ Between Bangor High Staff Member and Student

May 26, 2023

Press Herald Quotes Fake “Small Business Coalition” Without Disclosing Funding Ties to Liberal Dark Money Groups

May 26, 2023

Maine’s Media Ignores Taxpayer-Funded Community College Free Rides for Noncitizens

May 26, 2023

Maine Public School Officials Used Government Resources to Advocate Against Ban on Obscene Books, Emails Show

May 26, 2023

Lawmakers Seek to Broaden Maine’s “Clean” Election Act

May 26, 2023
Newsletter

News

  • News
  • Campaigns & Elections
  • Opinion & Commentary
  • Media Watch
  • Education
  • Media

Maine Wire

  • About the Maine Wire
  • Advertising
  • Contact Us
  • Submit Commentary
  • Complaints
  • Maine Policy Institute

Resources

  • Maine Legislature
  • Legislation Finder
  • Get the Newsletter
  • Maine Wire TV

Facebook Twitter Instagram Steam RSS
  • Post Office Box 7829, Portland, Maine 04112

Type above and press Enter to search. Press Esc to cancel.

Sign In or Register

Welcome Back!

Login below or Register Now.

Lost password?

Register Now!

Already registered? Login.

A password will be e-mailed to you.