Despite budget gap warnings, Janet Mills wants to spend more

By Matthew Gagnon

Gov. Janet Mills dropped her latest biennial budget proposal last Friday, unveiling a staggering $11.63 billion spending plan for the next two years.

Despite months of dire warnings about “flattening revenues” and “difficult” choices, Mills’ budget plan would escalate state government spending by more than a billion dollars over the previous biennium. 

Of course, none of this should surprise anyone. Since her first days in office, Mills, along with legislative Democrats, has displayed a knack for massive budgets and dramatic increases in spending. Her initial 2019 proposal exploded spending by $800 million, bringing a previously controlled (if still bloated) budget to $7.9 billion. 

Then, amid the pandemic in 2021, she and Democrats seized the opportunity to pass what she called a “back to basics” budget through a simple majority vote — deliberately cutting out Republican participation — and soon afterward tacked on hundreds of millions more. Ultimately, they raised spending by $600 million to $8.5 billion.

The governor and Democrats once again decided to play games with the budget in 2023, passing a state budget in parts, with the support of her party and ignoring Republicans, raising spending to a staggering $10.5 billion.

I can’t say I’m surprised that her newest budget proposal once again raises the bar of spending to stratospheric heights, though if you were to buy into Mills’ rhetoric leading up to this budget, you may actually be shocked. 

Leading up to Friday’s release, Mills insisted Maine faced a significant structural gap and that lawmakers needed to brace for inevitable cuts in a “tight budget.” All of this paints a grim picture of a budget that contained lower revenue, giving lawmakers no choice but to trim spending and maybe even propose targeted tax increases.

This was reinforced by Mills’ announcement that there is now also a $118 million MaineCare shortfall. Belts would have to tighten, she told us. There just isn’t any money. 

Yet when the proposal finally arrived, it seems those warnings were little more than political theater. The budget gap that Mills warned about is not the result of sluggish revenues. It — and this year’s MaineCare shortage — is, I believe, the result of uncontrolled expenditures from Mills’ and Democrats’ government expansions outstripping the extra revenue.

The state is pulling in plenty of money, far more than than the prior budget and far above inflation. 

What I consider the irresponsibility of the governor and Democrats’ prior budgets has been hidden by a windfall of federal relief dollars and inflation-driven tax gains. Rather than controlling their thirst for spending, they funneled this money into permanent obligations, expansions of Medicaid and new programs. When the pandemic funds started drying up and inflation started to lessen, the real cost of this spree came into sharp focus.

Inside this budget proposal, we once again find appalling bloat almost everywhere. Amid all the talk of making “targeted programmatic reductions to certain programs” and “programmatic changes to save costs,” the Department of Health and Human Services is slated to balloon by more than $550 million.

Many other departments would go up as well. The Department of Education would also increase by $254.53 million, the Department of Corrections would get an additional $54.68 million, the University of Maine System would get $46.74 million more, the Judicial Branch $43.09 million and the Maine Community College System $39.76 million. 

To pay for it all, Mills relies on “targeted revenue enhancements,” which is code for tax and fee increases. The proposed budget would increase the tobacco tax, impose new “assessments” on ambulance and pharmacy services, slap a digital tax on streaming, and raise a raft of fees ranging from hunting licenses to concealed-handgun permits.

Mills insists these aren’t broad-based increases, but as these taxes will touch virtually all of us, it feels plenty broad to me. And I believe none of it is necessary, when you understand how much revenue we are pulling in and how much spending is increasing everywhere.

Despite all this, Mills claims she’s acting responsibly. Rather , she has overseen a budget catastrophe in my view, and is now looking to pull more blood out of the stone to keep the spending extravaganza going.

It is time to stop this, and demand a responsible budget.

I urge Republicans to hold their ground, refuse to endorse new taxes on working Mainers and push relentlessly to rein in uncontrolled spending. Yes, Mills and her Democratic allies might once again move to pass another majority budget without bipartisan input. But it is legislative Democrats who should object to that and tell the governor she needs to lead, rather than play political games.

If they do it anyway, refuse to participate and use this largely self-created budget mess to fight for a majority that will take it seriously in the next election.

Gagnon of Yarmouth is the chief executive officer of the Maine Policy Institute, a free market policy think tank based in Portland. A Hampden native, he previously served as a senior strategist for the Republican Governors Association in Washington, D.C.