As the 2025 Fiscal Year came to a close last month, Maine’s General Fund turned out to have a $152.2 million surplus, the governor’s office declared last week.
In addition, the state’s Budget Stabilization Fund, also known as the “Rainy Day Fund,” has also reached its statutory maximum of $1.03 billion.
Mainers should not expect to see any of their tax dollars coming back to them, however.
Instead, the surplus will be distributed across a number of categories in accordance with state law as outlined by the Legislature in the co-called “cascade” plan.
Despite there being millions of dollars left over this fiscal year, Mainers will still be seeing a number of new and increased taxes in the coming months, including on streaming service subscriptions and tobacco products.
Taken together, these changes are expected to increase state revenue by $177 million, according to the Portland Press Herald.
[RELATED: Live in Maine? Your Streaming Service Subscriptions May Soon Be Subject to a New Tax]
“Over the past six years, my Administration has worked hard to invest in Maine people, improve our economy, and produce responsible, balanced state budgets,” Gov. Janet Mills (D) said in a statement Tuesday.
“I look forward to maintaining this progress for Maine people, despite the needless economic challenges and uncertainty coming from Washington,” she added, apparently taking aim at the Trump Administration and Congressional Republicans.
Fitch Ratings, a international credit rating agency, recently upgrade Maine’s bond credit to AA+, the second highest rating it offers.
“Governor Mills’ and the Legislature’s fiscal policies have allowed us to build significant cash reserves, creating flexibility and security for the state,”said Joe Perry, Maine State Treasurer. “This ratings upgrade from Fitch affirms that we are on a good path.”
“Unfortunately only one of them [Democrats] had the moral fortitude to vote ‘no,’” House Minority Leader Billy Bob Faulkingham (R-Winter Harbor said in a statement shared by the Press Herald.
He continued, positing: “The question now is with this revenue surplus, will Democrats backtrack and cut these taxes, of will they continue their reckless spending?”
Senate President Mattie Daughtry (D-Brunswick) echoed the governor’s criticisms of the federal government, suggesting that “it is responsible governance to take a cautious approach.”
In following with the pre-determined “cascade” for this year’s surplus, $2.5 million will be sent to the Reserve for Operating Capital, $350,000 to the Governor’s Contingent Account, $1 million to the FAME Loan Insurance Reserve, and $2 million to the Unfunded Actuarial Liability for Retiree Health Insurance.
At the end of this Legislative session, lawmakers identified two other funding priorities to be included in this year’s cascade: $24 million for the MaineCare Stabilization Fund and $3 million for the Maine Center for Disease Control and Prevention Program.
The remaining surplus was divided between the Budget Stabilization Fund (BSF) and the Highway and Bridge Capital Fund (HBCF), with 80 percent being sent to the BSF and 20 percent to the HBCF.
The Budget Stabilization Fund is intended to serve as a reserve account to cover the state’s expenses in the case of a General Fund revenue shortfall.
The total value of the BSF is capped at 18 percent of the General Fund revenue for the Fiscal Year being closed.
When the BSF was first established in 2005, the cap was set at 12 percent of General Fund revenue, but was eventually raised to 18 percent ten years later in 2015. Until 2022, the BSF balance generally remained well below the statutory cap.
This year, $79.4 million was allocated to the BSF, and $33.8 million was sent to the HBCF.
“The nearly $34 million will be used to ensure this year’s construction as defined in our three-year work plan is adequately funded,” said Bruce Van Note, the outgoing commissioner of the Maine Department of Transportation. “The plan includes projects that will improve roads and bridges, enhance safety, and increase economic opportunity through upgraded transportation infrastructure across the state.”
