Mills submits plan to Legislature for spending $1 billion in federal stimulus aid

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Jun. 4—The Mills administration submitted its proposal for spending nearly $1 billion in federal stimulus dollars to the Legislature on Friday, setting in motion what is likely to be a rushed review of the massive spending plan Gov. Janet Mills announced a month ago.

Maine is expected to receive approximately $4.5 billion from the $1.9 trillion American Rescue Plan passed by Congress along party lines in March as a way to stimulate the economy amid the COVID-19 pandemic. Roughly $3.5 billion of that total will go to pandemic response, unemployment benefits, stimulus payments to individuals, relief payments to businesses or to town and county governments.

Mills has proposed dividing state government's $997.5 million share among three target areas: $258.4 million for short-term economic recovery programs, $294.5 million for long-term economic initiatives, and $418 million for infrastructure improvements.

The funding would be used for everything from economic recovery grants for businesses to hundreds of millions of dollars for broadband expansion, energy efficiency upgrades and capital improvements at state parks, state-run fish hatcheries and wastewater treatment plants.

"It is an awesome responsibility to determine how to use these time-limited funds in a way that stimulates economic growth over the short-term and the long term, in ways that will benefit all Maine people," Kirsten Figueroa, commissioner of the Department of Administrative and Financial Services, told the Appropriations and Financial Affairs Committee. "The administration has created this roadmap that is in lock step with the intentions of Congress as they passed this transformative legislation to enable states to move their economies through and past the throes of the pandemic."

Mills unveiled much of the plan on May 4 but the details submitted to lawmakers this week were fine-tuned based on guidance from the U.S. Treasury, Figueroa said. Most of the expenditures were intended to be pilot projects or one-time investments to avoid ongoing spending obligations based, in large part, on the recommendations of a state economic recovery committee and a 10-year economic development plan.

Friday's meeting was the budget-writing committee's first presentation on the nearly $1 billion plan and comes less than two weeks before the Legislature is slated to adjourn.

The dozens of initiatives contained in the plan include:

— $21 million to expand broadband internet access, to be supplemented by $129 million in additional federal money earmarked for broadband infrastructure;

— $80 million in grants and loans to businesses still struggling from the pandemic;

— $105 million for career and technical education, workforce programs and higher education initiatives;

— $50 million to prop up Maine's three "heritage industries" of fishing, farming and forestry;

— $80 million to replenish the state's unemployment trust fund and avoid a potential 60 percent increase in unemployment taxes on businesses because of pandemic-related expenditures;

— $5 million for a "remote worker welcome program," to retain people who moved to Maine during the pandemic and lure more remote workers;

— $50 million to repair roads and bridges;

— $50 million to upgrade buildings, roads, shelters and other infrastructure at Maine state parks.

Figueroa noted that $22 million of the total will go toward administration, tracking and the reporting required by the federal government.

Lawmakers on the budget-writing committee face an extreme time crunch to review the plan as well as a mid-budget change package submitted by the Mills administration. The Legislature is scheduled to adjourn by June 16 and every day next week is occupied with House and Senate floor sessions, leaving the committee with little uninterrupted time to review the $1 billion spending plan.

As of Friday, there was no public hearing scheduled for the bill, L.D. 1733.

"We are trying to figure that out but we do not have a firm public hearing date on the schedule yet," said Sen. Cathy Breen, D-Falmouth, the committee co-chair.

Several committee members expressed concerns about the late timing of the stimulus spending plan.

Rep. Sawin Millett, R-Waterford, also asked if Figueroa or other leaders of state agencies are concerned about the ability to manage the sudden addition or expansion of so many programs. A former finance and DAFS commissioner, Millett compared the situation to "changing the tires on the airplane while they are flying it."

Figueroa responded that after 16 months of navigating a pandemic, state officials have become accustomed to "flying while building."

"We are embracing the challenge and have considerations for the amount of work but also are excited and ready for the impact, improvements and transformation that will happen as a result of all of the activities that we have been talking about," Figueroa said. "There are long-standing issues that people who have worked in state government ... have talked about for years and there are opportunities here now."

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