“A jobs bond will give our economy a much needed shot in the arm,” said Rep. Emily Cain, the House Minority leader. “The best way to improve our economy is by making more investments that will help small businesses, job training and public education.”

Maine has lost more than 1,000 jobs since 2011 and was recently rated 50th for personal income growth according to the U.S. Bureau of Economic Analysis.

The Legislature approved a total $95.6 million in bond proposals, which Democrats say will create immediate jobs now and set the foundation for economic growth in the future.

The bond proposal includes:

• $51 million for transportation improvements,
• $20 million for research and developments,
• $11.3 million for higher education,
• $7.9 million for water and waste water treatment; and
• $5 million for land conservation.

The proposals will be sent to the voters for approval on the November ballot.

“If we don’t make these public investments now, we will be missing an opportunity to create jobs,” said Rep. Peggy Rotundo, the lead House Democrat on the Appropriations committee. “Public investment will create jobs now and grow good-paying jobs for our future. We have the money to make targeted investments now.”

According to the non-partisan fiscal experts from the Legislature’s Office of Fiscal and Program Review, the state has the capacity to make public investments in bonds for voters to approve. Debt service payments from 2013 to 2015 will decline by nearly $30 million, lowering the state’s payments on debt and increasing the capacity to borrow.

Maine has a track record of conservative bonding and has historically paid down its debt quickly. The state typically bonds for 10 years, not 20 or 30 as other states do. Debt service is typically between 4-7 percent of the General Fund.

“We need real investments that will improve our roads, bridges, and classrooms,” said Assistant Democratic Leader Justin Alfond, who added that Maine voters “deserve an opportunity to decide on the investment priorities for this state.”

Last year Republican lawmakers and Gov. Paul LePage refused to send a bond package to voters despite Democratic pressure for bonds to spur economic development and create jobs.

“It was completely reckless for the state of Maine not to bond last year,” said Sen. Cynthia Dill. “The need for infrastructure improvements was critical.”

According to Department of Labor statistics, Maine has lost 500 construction jobs from February to March this year alone.

“In the last year, Maine people have seen a continued drain on our jobs and income. Responsible bonding is a sure-fire way to get people back to work.” said Sen. Dawn Hill of York, who serves on the Appropriations committee.

Republican’s said they would not approve a bond package that was more than $100 million.

This year enough Republican lawmakers changed their position on a bond package.

“This is one of the keys to growth in the state of Maine,” said Sen. Chris Rector, a Republican. “I know we all want an economy that’s growing, that’s robust.”

Gov. LePage is out of the state and will review the bond proposal when he returns. If he approves of the bonds it will be up to voters to decide in November.

“While the health care jobs have been an economic driver over the course of the recent recession, the state’s efforts to reduce spending on social services, especially Medicaid, may reduce future growth prospects for that sector,” wrote Moody’s Investor Services, Maine’s credit rating agency, in a press release.

This was one reason why Moody’s dropped Maine’s bond rating to AA negative from AA positive. The agency said the negative outlook “reflects Maine’s recurring challenges on the spending side of its budget, primarily in the Department of Health and Human Services, which includes Medicaid.”

Some economists have said that the downgrade is a warning to the state to review policies that might endanger job growth. From 2002 to 2010 job growth occurred mainly in healthcare, manufacturing and innovation sectors.

Moody’s also saw problems with the lack of funds in the state’s rainy day fund— the minimal budget stabilization fund balances. The agency sited a, “weak general fund liquidity position reflecting the lack of reserves.”

Standard & Poor’s also served notice in the past eight months that Maine’s rating is in jeopardy because of tax changes that widen revenue gaps and deplete reserves.

The nearly $500 million in unfunded tax cuts for the wealthy passed by the Republican majority in the legislature and LePage during the past eighteen months has caused concern among these credit rating agencies.

During the Baldacci administration substantial cuts were made largely with consolidation efforts and the state still managed to increase the rainy day fund until the recession hit.

During an interview with WGME when Gov. Paul LePage first came to office he was asked about the state’s rainy day fund.

“On Jan. 5, when I was inaugurated, there was not enough money in the rainy day fund to buy dinner,” he said.

In reality the fund balance was $25.4 million when LePage took office, according to budget numbers posted on the Legislature’s Office of Fiscal and Program Review website. After the first quarter of the budget year state revenues were in the black by $5.9 million, boosted by continued corporate profits far higher than projected.

Those corporate profits, in many cases, were directly related to Baldacci’s Pine Tree Development Zone (PTDZ) initiative, which encourages companies to move to Maine or expand in the state by giving them tax incentives, and the removal of the BETR equipment tax.

• There are twelve corporate companies headquartered in the state of Maine were included on the 2010 Inc. 500/5000 list of the fastest growing, privately held companies in America. To qualify, the companies had to have revenues of at least $2 million in 2009.

• According to the Maine Development Foundation, from 2007 to 2008 the state of Maine experienced greater growth in per-capita personal income than the nation—3.9 percent compared to 2 percent. Then the Great Recession hit. Still, from 2009 to 2010, Maine’s personal income grew by 3.5 percent.

• According to the Maine International Trade Center between 2002 and 2008, Maine exports rose over $1 billion. In 2010 Maine became the 5th fastest growing state for exports. During the Baldacci administration Maine companies brought in $60 million in export sales as a direct result of trade missions and trade shows.

• MITC said that the 2009 Trade and Energy Mission to Spain and Germany was the most successful trade mission to date, with over $21 million in sales and contracts reported by the Maine companies.

• During the Baldacci year’s 310 companies have located to Maine or expanded their businesses here, because of PTDZ incentives. They represent a total investment of $873 million, with an annual payroll of $341 million. That’s 8,206 jobs.

Despite the recession when Gov. Baldacci turned the state over to Gov. LePage the state was in the black with a rainy day fund.

Moody’s report stated that “A rating downgrade could be triggered by: the emergence of further significant budget gaps in the current biennium or future fiscal years; the absence of a clearly articulated plan to achieve meaningful improvement in the state’s available reserve position in the near term; cash-flow strain stemming from reduced liquidity; or a slower than average economic recovery that hinders revenue growth.”

LD 849, a bill sponsored by Senator Jon Courtney and passed by the legislature would put Maine’s credit rating at risk. According to the nonpartisan fiscal office of the Maine Legislature, full implementation of LD 849 as written would cause losses to Maine schools, roads, bridges, and towns totaling over $1.2 billion per biennium. This is because the TABOR measure lowers taxes, which would leave state programs in need of funds. The state would be forced to cut back on programs. And municipalities would be forced to raise property taxes to make up for the lack of state funding.

“We’ve heard loud and clear from the credit agencies that this bill puts Maine’s credit rating at risk,” said Rep. Seth Berry, who has opposed this TABOR like measure. “This is nothing short of an unfair and unfunded tax shift onto middle class families who are already paying enough in property taxes.”

Analysis by Maine Revenue Services shows the Republican bill, would give an average tax reduction of only $1 to the bottom 20 percent of income earners. By comparison, the tax cut would give an average reduction of over $21,000 to the wealthiest 1 percent of Maine residents.

“This isn’t a tax cut. It’s a tax shift, and it’s a sham,” said Sen. Philip Bartlett II, during debate. “This is nothing more than credit card politics.”

In February, Fitch Ratings Inc., one of the most influential credit rating agencies, changed its outlook for Maine’s creditworthiness from “stable” to “negative.” Fitch warned that their rating “is dependent upon the state’s ability to … meaningfully rebuild reserves depleted during the recession.”

“We’ve heard loud and clear from the credit agencies that this bill puts Maine’s credit rating at risk,” said Rep. Seth Berry, who has opposed the TABOR like measure that threatens funding for schools and towns across the state. “This is nothing short of an unfair and unfunded tax shift onto middle class families who are already paying enough in property taxes.”

The bill and the nearly $500 million in unfunded tax cuts for the wealthy passed by the GOP in the past eighteen months has caused concern among the credit rating agencies. A down grade of Maine’s AA+ credit rating could result in higher interest rates and loss of investor confidence.

Analysis by Maine Revenue Services shows the Republican bill, would give an average tax reduction of only $1 to the bottom 20 percent of income earners. By comparison, the tax cut would give an average reduction of over $21,000 to the wealthiest 1 percent of Maine residents.

The original proposal used 20 percent of one-time surpluses that would typically be put in the state’s reserve funds to make permanent cuts, without paying for them in future years. The surplus only pays for the cuts in the first year.

In February, Fitch Ratings Inc., one of the most influential credit rating agencies, changed its outlook for Maine’s creditworthiness from “stable” to “negative,” putting the state on notice that our high AA+ rating is in danger of being downgraded. Fitch warned that their rating “is dependent upon the state’s ability to … meaningfully rebuild reserves depleted during the recession.”

Moody’s Investor Services and Standard & Poor’s, the other two major credit rating agencies, have also served notice in the past eight months that Maine’s rating is in jeopardy because of tax changes that widen revenue gaps and deplete reserves.

In an effort to make it more palatable to the credit agencies, Republican lawmakers on the Appropriations committee introduced an amendment that would put more money in the state’s rainy day fund before allowing the ratchet down to go into effect.

Democrats and leading Republicans in the LePage Administration shared concerns that the bill uses one-time money to pay for ongoing cuts , and could impact the state’s bond rating.
Democrats have said this is as irresponsible as taking on a car payment after winning a $100 on a scratch ticket.

According to the nonpartisan fiscal office of the Maine Legislature, full implementation of LD 849 as written would cause losses to Maine schools, roads, bridges, and towns totaling over $1.2 billion per biennium.

“This risky, costly, and radical proposal would have undermined the laws that protect Maine’s environment and communities,” said NRCM Advocacy Director Pete Didisheim. “Despite a massive effort by lobbyists to force this dangerous bill through the legislature, a bipartisan majority held firm and refused to support it. Common sense won the day over ideology.”

The original bill would have allowed property owners to receive payments from the State Treasury to compensate them for claimed losses in property values resulting from future land use regulations. Property owners would be allowed to ignore Maine law if the
State did not make the compensation payments.

Such proposals have been broadly defeated nationwide based on concerns about their high costs and negative consequences, and previous takings bills have been rejected by the Maine Legislature at least five times since 1995.

In March, a majority of the Judiciary Committee rejected LD 1810, and proposed a complete substitute that would avoid the litigation, costs, and harm to the environment that would have resulted from the bill. But supporters of the original bill worked relentlessly to keep their proposal alive. These efforts peaked during the week of April 9, when the Majority Report from the Judiciary Committee was blocked in the House, and the Minority Report was voted on instead, passing by a one-vote margin. (See http://www.downeast.com/georges-outdoor-news/2012/april/knight-beating-takings)

Lobbyists then attempted for several days to force the bill forward in the Senate, but they faced a bipartisan block of 20 Senators—including Republican Senators Tom Saviello, Roger Katz, Chris Rector, and Earl McCormick—who were firmly opposed to the Minority Report. The Senate adjourned at 2:30 a.m. on April 14 without taking a vote on LD 1810, leaving it to be considered when they reconvened May 15. When the bill finally was scheduled for consideration in the Senate, it was clear that supporters of the Minority Report had failed to recruit any additional support, so they offered a motion to “indefinitely postpone” the bill—and the House followed suit.

“We greatly appreciate the strong leadership provided by both Republicans and Democrats who saw the takings bill for what it was—a thinly veiled attempt to prevent the Legislature from passing laws in the future that will be needed to protect our communities, wildlife habitat, and the character of Maine,” said Maine Audubon’s Staff Attorney Jenn Burns Gray.

The Majority Report proposal from the Judiciary Committee was drafted by Rep. Brad Moulton (R-York) and Rep. Charles Priest (D-Brunswick), with input from Sen. Tom Saviello (R-Franklin), Rep. Bob Duchesne (D-Hudson) and other lawmakers. This proposal would have created a Regulatory Fairness Committee to evaluate the impact of regulations on property owners and initiate legislative solutions. The motions to indefinitely postpone the bill had the result of blocking adoption of the Majority Report.

“The takings bill finally hit the brick wall of reality,” said Sean Mahoney, Maine Director of the Conservation Law Foundation. “The Minority Report was so complex, convoluted, costly, and extreme that it would have been a disaster if passed into law. We’re very pleased that a majority of Maine legislators understood this and voted to kill the bill.”

Maine taxpayers would have had to pay millions of dollars over time to fund implementation of the Minority Report. The fiscal note over the first three years alone was pegged at $1.28 million, and this estimate did not include any of the funds that would be needed to pay possible compensation payments of up to $400,000 per case.

In the very few states in the U.S. that have adopted legislation anything like the Minority Report, studies have revealed that corporate interests, large-scale developers, and attorneys have been the primary beneficiaries. Former State Senator Peter Mills made this point to legislators this year, saying “The primary impact—and its intended impact—is to stymie regulation for the benefit of large landowners with ample resources to paralyze state agencies. That is, in fact, how takings laws have been used in the few states that have enacted them. It’s not a statute for the little guy.”

“The Minority Report would have created multiple paths for developers to receive waivers from Maine law, allowing them to build developments that otherwise would be illegal,” said Didisheim. “Such waivers would have caused an unraveling of the laws that protect Maine’s environment and triggered lawsuits by people who suddenly learned that a massive development, waste dump, or energy project was landing next door to them because the developer had received a waiver from the law.”

“The Minority Report posed a major threat to Maine’s environmental safeguards,” said Maine Conservation Voters Executive Director Maureen Drouin. “That’s why defeating the bill was a top priority for people and organizations throughout Maine who love our clean air, clean water, and healthy communities.” The Maine Clammers Association, Congress of Lakes Association, Maine Municipal Association, and all of Maine’s major conservation and environmental organizations opposed the Minority Report for LD 1810.

Passage of takings bills like LD 1810 has been a high priority for the ultra-right-wing American Legislative Exchange Council (ALEC), which has promoted model legislation to state legislatures since the early 1990s.

BRUNSWICK — Two state lawmakers-turned-lovers, Reps. Alex Cornell du Houx and Erin Herbig, have reached a private agreement to settle their legal differences.

Both legislators declined to discuss the details of the pact, which was reached late on May 11.

On Monday, May 14, Herbig, a Belfast Democrat, withdrew a request in Belfast District Court for an order of protection from abuse against Cornell du Houx, who announced he had requested a leave of absence for the last few days of the legislative session.

“Last week, before we came to an agreement, I informed leadership that I will be taking an excused absence for the next few days,” the Brunswick Democrat said.

Herbig and Cornell du Houx were involved in a romantic relationship, but when the relationship went sour, Herbig claimed Cornell du Houx stalked her and invaded her privacy in various ways, despite repeated warnings from legislative leadership and Herbig’s attorney, Chris MacLean.

Maine State Police opened an investigation into her allegations, but they closed the case on May 11.

“It’s over,” spokesman Stephen McCausland of the Maine Bureau of Public Safety said. “There will be no enforcement action.”

Herbig and Cornell du Houx have each said they intend to seek re-election this year.

“I’ve dedicated myself to the people of Brunswick as a lawmaker and to my country as an officer in the Navy,” Cornell du Houx said. “I am looking forward to continuing to serve in the Legislature and running for office.”

Cornell du Houx recently ended a three-year stint at the Truman National Security Project in Washington, D.C., where he said he traveled the country to recruit and train future leaders, elected officials, their staff, nonprofits, and others involved in national security issues and climate change.(for more on Cornell du Houx’s work at Truman click here.)

On May 9, his sister, Rebecca Cornell du Houx said that Herbig had contacted the Truman Project in an effort to discredit him.

“Erin called his boss in D.C. and told him she thought Alex had (Post-Traumatic Stress Disorder). I find that unconscionable. … It’s awful this has happened, and totally unjustified.”

Cornell du Houx said he voluntarily left the Truman project.

“I left the Truman National Security Project to focus on my re-election efforts,” he said.

Cornell du Houx made his first public appearance in Brunswick after the controversy, when he attended a ribbon-cutting ceremony Monday for the town’s new train station.

“I went to the Amtrak opening and it was very heartening when members of the community came to to voice their support,” he said. “I am extremely grateful for all the community support I have received.”

Herbig said that she, too, has been buoyed by public reaction.

“I want to thank my family, colleagues, constituents and people from all across the state for their support and encouragement in this very difficult process,” she said in a prepared statement following the agreement.

Cornell du Houx said he will be leaving on a trip to Australia to lead a delegation of veterans to foster international relations later this month, but that it is not a result of the agreement.

“That’s been in the works for about nine months,” he said. “I’ve done previous trips to Malaysia and Indonesia in a similar manner.”

by Matt Hongoltz-Hetling can be reached at matthh@theforecaster.net. Follow him on Twitter: @hh_matt.

UPDATE: for some unknown reason Hongoltz-Hetling edited his article on line taking out Rebecca Cornell du Houx’s comments of May 9, 2012

This is now how the article reads on the Forcaster’s website:

Family releases psych evaluation of embattled Brunswick Rep. Cornell du Houx

BRUNSWICK — Two state lawmakers-turned-lovers, Reps. Alex Cornell du Houx and Erin Herbig, have reached a private agreement to settle their legal differences.

Both legislators declined to discuss the details of the pact, which was reached late on May 11.

On Monday, May 14, Herbig, a Belfast Democrat, withdrew a request in Belfast District Court for an order of protection from abuse against Cornell du Houx, who announced he had requested a leave of absence for the last few days of the legislative session.

“Last week, before we came to an agreement, I informed leadership that I will be taking an excused absence for the next few days,” the Brunswick Democrat said.

Herbig and Cornell du Houx were involved in a romantic relationship, but when the relationship went sour, Herbig claimed Cornell du Houx stalked her and invaded her privacy in various ways, despite repeated warnings from legislative leadership and Herbig’s attorney, Chris MacLean.

Maine State Police opened an investigation into her allegations, but they closed the case on May 11.

“It’s over,” spokesman Stephen McCausland of the Maine Bureau of Public Safety said. “There will be no enforcement action.”

Herbig and Cornell du Houx have each said they intend to seek re-election this year.

“I’ve dedicated myself to the people of Brunswick as a lawmaker and to my country as an officer in the Navy,” Cornell du Houx said. “I am looking forward to continuing to serve in the Legislature and running for office.”

Cornell du Houx recently ended a three-year stint at the Truman National Security Project in Washington, D.C., where he said he traveled the country to recruit and train future leaders, elected officials, their staff, nonprofits, and others involved in national security issues and climate change.

Cornell du Houx said he voluntarily left the Truman project.

“I left the Truman National Security Project to focus on my re-election efforts,” he said.

Cornell du Houx made his first public appearance in Brunswick after the controversy, when he attended a ribbon-cutting ceremony Monday for the town’s new train station.

“I went to the Amtrak opening and it was very heartening when members of the community came to to voice their support,” he said. “I am extremely grateful for all the community support I have received.”

Herbig said that she, too, has been buoyed by public reaction.

“I want to thank my family, colleagues, constituents and people from all across the state for their support and encouragement in this very difficult process,” she said in a prepared statement following the agreement.

Cornell du Houx said he will be leaving on a trip to Australia to lead a delegation of veterans to foster international relations later this month, but that it is not a result of the agreement.

“That’s been in the works for about nine months,” he said. “I’ve done previous trips to Malaysia and Indonesia in a similar manner.”

Matt Hongoltz-Hetling can be reached at 781-3661 ext. 123 or matthh@theforecaster.net. Follow him on Twitter: @hh_matt.

Four bond proposals that would make needed investments in Maine’s colleges and universities, research and development, land conservation, and waste water and drinking water treatment gained initial support in the Maine House late this afternoon. Additional votes on these proposals and other public investments in improving roads and bridges are expected tonight.

Democrats urged strong support for the total $95.6 million in bond proposals before the House and Senate.

“A jobs bond will give our economy a much needed shot in the arm,” said Rep. Emily Cain, the House Democratic leader. “The best way to improve our economy is by making more investments that will help small businesses, job training and public education.”

Maine has lost more than 1,000 jobs since 2011 and was recently rated 50th for personal income growth according to the U.S. Bureau of Economic Analysis.

Earlier today, Republican lawmakers rejected two Democratic bond proposals that would have made investments in revitalizing Maine’s downtown communities and increased energy efficiency.

According to the non-partisan fiscal experts from the Legislature’s Office of Fiscal and Program Review, the state has the capacity to make public investment in a bond package for voters to approve. Debt service payments from 2013 to 2015 will decline by nearly $30 million, lowering the state’s payments on debt and increasing the capacity to borrow.

“It’s clear we can afford to invest in a jobs bond,” said Rep. Peggy Rotundo the lead House Democrat on the Appropriations committee. “If we don’t make these public investments now, we will be missing an opportunity to create jobs. Public investment will create jobs now and grow good-paying jobs for our future.”

The Association of General Contractors said the state lost 500 construction jobs from February to March this year alone, according to Department of Labor statistics.

Democrats support a comprehensive jobs bond, including public investment in roads, bridges and rail; research and development; educational infrastructure; water and wastewater treatment; and land conservation.

Maine has a track record of conservative bonding and has historically paid down its debt quickly. The state typically bonds for 10 years, not 20 or 30 as other states do. Debt service is typically between 4-7 percent of the General Fund.

Bonds require two-thirds support of the members present and voting to pass.

“Thankfully the Republicans saw the light and gave up their fight on passing a measure that would have cost millions of dollars to Maine taxpayers,” said Senator Phil Bartlett. “Worse, it would have hampered future legislatures from passing laws needed to protect Maine’s economy, environment, and communities.”

Democrats argued that LD 1810 would have increased lawsuits, pit landowners against taxpayers, and resulted in a financial windfall for special interest lawyers. The measure would have allowed state agencies and the courts to waive land use rules and regulations for any kind of development.

“This measure was the wrong way to address concerns with land use regulations,” said Senator Seth Goodall of Richmond. “A better approach is to make sure that we mindfully strike the right balance between protecting our natural resources while not overburdening property owners.”

The Senate ignored a bipartisan alternative, which earned the support of the majority of members vote of the state’s Judiciary Committee. The bipartisan proposal would have made last year’s Regulatory Fairness Committee a standing legislative committee. The panel would meet regularly to hear complaints about regulations and recommend legislation to address them.

“The only ones to benefit from this measure would have been the special interest lawyers and those who can afford to pay for them,” said Senator Cynthia Dill who also serves on the Judiciary Committee.

The Takings Study Committee Report, which showed that nearly 100 percent of permit applications to the DEP have been approved in the last 10 years.