Maine

Maine is a law-abiding state, and its laws require that the Governor’s Office insert into the budget at least three performance measures for every one of the state’s thousands of programs. The administration of Governor John Baldacci dutifully complied with the rules upon taking office in January 2003. The budget was then submitted to the legislature, where a clerk removed the performance measures and printed the budget bill without them, because the legislature’s computer system can’t support the measurement data.

Of course, the information still exists, and enterprising legislators can get access to it. But the whole charade highlights the chasm between performance budgeting as a paperwork mandate and as a useful instrument of the governmental process. The most telling point is that the state’s Performance Budgeting Commission has had one meeting in the past four years.

Term limits in the legislature haven’t helped. It’s not so much the eight-year limit, but the fact that legislators don’t have enough time to learn in depth about specific subject areas, as they did in the past. “You can have a person sitting on the Human Resources Committee who doesn’t have any experience at all with that department,” says Marge Kilkelly, a veteran of 16 years in the legislature, and now a staffer for the Council of State Governments.

Money B- Long-Term Outlook Budget Process Structural Balance Contracting/Purchasing Financial Controls/Reporting People B- Strategic Workforce Planning Hiring Retaining Employees Training and Development Managing Employee Performance Infrastructure B Capital Planning Project Monitoring Maintenance Internal Coordination Intergovernmental Coordination Information C+ Strategic Direction Budgeting for Performance Managing for Performance Program Evaluation Electronic Government • Population (rank): 1,274,923 (40) • Average per capita income (rank):    $28,831 (34) • Total state spending (rank):    $6,264,883,000 (41) • Spending per capita (rank):    $4,838 (20) • Governor: John Baldacci (D) • First elected: 11/2002 • Senate: 35 members: 18 D, 17 R • Term Limits: 8 years (consecutive) • House: 151 members: 76 D, 73 R, 2 I • Term Limits: 8 years (consecutive)

The underexperienced and overworked Maine legislature has been almost entirely consumed with making sure it produces a balanced budget under ruthless pressure. Performance budgeting measures could be an enormous help in deciding on budget cuts, but legislators who haven’t used them before aren’t likely to start when faced with huge upcoming shortfalls.

Budgeters are dealing with a $733 million gap in the 2006-07 budget — less severe than the challenges faced for the current biennium but still sizable. Ambitious plans in the health arena and increasing health benefit costs for state employees are a major reason for the gap. A statutory obligation to take on more education spending is also a major factor. “Maine at this point is just keeping its head above water,” says Joe Brannigan, the House chair of the Joint Appropriations and Financial Affairs Committee.

Some of the state’s budgeting practices have improved a great deal. Long-term fiscal projections are made, and an effort is underway to refill the depleted reserve fund. In June 2003, the legislature increased the cap on this fund to 10 percent of revenues instead of 5 percent, not a bad idea given that a good portion of the state’s revenues come from the very volatile income tax.

Revenue estimating has improved greatly as well. In the old days, legislators constantly battled each other not just over where to spend money but over how much there was to spend. Now, state officials practically get misty-eyed when they talk about consensus revenue estimating. The system is transparent, works well and yields good results. The expenditure side estimates aren’t quite as good, particularly in the hard-to-pin-down Medicaid program, where accounting irregularities and overly optimistic savings projections have resulted in major cost overruns in the past few years. The projection of expenditures is generally far less transparent than the projection of revenues.

Capital budgeting is getting better, with serious attempts to elicit detailed information from agencies before resources are committed. One important change made last year was the decision to unite the capital planning process for bond requests with the planning for other capital spending. Previously, agencies sent their capital plans to one office and their bond requests to another one.

The state’s personnel system is generally well run. In recent years, the Bureau of Human Resources has taken on a consulting role, with agencies given more direct control over their personnel needs. For a state with a heavily unionized civil service environment, Maine has notably quick and flexible hiring practices.

For additional data and analysis, go to: http://results.gpponline.org/maine

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