Maine governor makes cuts to state spending

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Gov. Janet Mills has issued a curtailment order to address the more than $525 million budget shortfall amid the COVID-19 pandemic.

With a curtailment order, Maine governors are permitted to balance budgets when the state Legislature is adjourned.

The order, which adopts recommendations from the Department of Administrative and Financial Services (DAFS), cuts allocations state’s General Fund by $221,775,584 and to the Highway Fund by $23,000,822, according to a news release from the governor’s office.

“As all states across the nation struggle with the drastic consequences of COVID-19, this administration’s proactive fiscal management and willingness to attract and leverage federal resources has made all the difference in preserving solvency for the State’s most important functions and supporting the state’s economy,” Kirsten Figueroa, DAFS commissioner, said.

“Governor Mills’ curtailment order addresses the shortfall as we know it today and ensures the continuity of crucial services for Maine residents during these unprecedented times. As we look ahead to the next biennium, we will continue to closely monitor revenue receipts, updated forecasting, and the availability of federal funds, which will be even more crucial in FY22 and FY23 if we are to avoid significant programmatic changes.”

The nonpartisan Revenue Forecasting Committee in July projected Maine’s General Fund would have a $528 million shortfall in revenue. Before the report, Mills and the Legislature had worked to set aside $106 million.

To cover the $422 million shortfall, Mills directed the DAFS to develop solutions that would minimize impact on education programs and critical personnel.

Based on the DAFS recommendations, the curtailment order:

• Replaces roughly $97 million in state spending with federal funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act Coronavirus Relief Funds; and

• Adopts approximately $125 million in departmental cost savings and efficiencies, including federal grants for departmental functions and freezing hiring for many vacant positions.

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