Editorial by Ramona du Houx

October 31, 2010

For eight years the state of Maine has been setting a foundation for job growth. We haven’t heard about it in the press much because it isn’t sensational or sexy. And stories that develop over time don’t make good copy for thirty-second sound bites.

Taking on the streamlining of government, the merging of two of the largest social service agencies, incorporating IT technology to stop government replication, consolidating school administration districts, and correctional services have not been popular. They made headlines initially because they were controversial but now that savings and better services have been achieved most news agencies have not followed up.

But they should.

Fiscal responsibility is a hard challenge in the best of years; during a recession it was a formidable task. Maine’s budget for 2011 is the same level as it was in 2001. State spending has decreased every year since 2008 while maintaining core services to education, human services and public safety.

Over eight years preserving close to a million acres, creating Pine Tree Zones, new grants in innovation, and a robust community college system have invested in Maine building a better quality of life. All this was done as Governor Baldacci kept his campaign promise to never raise broad-based taxes.

All these efforts have helped the state achieve a great bond rating, so investments can be made at a low interest rate.

Recently, Maine was able to make payments to its pension system and business support programs. Maine has rebuilt its reserves to $50 million dollars, and through the end of September revenues are out performing projections by $26.3 million dollars.

Think about it: Maine has a rainy day fund coming out of the recession. That’s not bad, other states are envious.

Fiscal discipline has helped to set the stage for Maine’s economic recovery— try as I may I just can’t make that sound sexy. But it should be headline news because businesses looking to relocate research a state’s economic state. Fiscal discipline attracts businesses.

310 companies have located to Maine or expanded their businesses here taking advantage of Pine Tree Zones tax incentives, the workforce and the state’s quality of life. These companies have committed to more than $800 million in investments and over $300 million in payroll representing over 8000 jobs.

Maine is a state of innovators. In every corner of the state there are entrepreneurs with unique ideas – their hearts set on opening a small business. Some are inspired along similar lines creating pockets, called clusters, of businesses. These clusters include educational institutions that make scientific discoveries, which in turn helps start up new businesses.

Since 2007 this synergy has strongly been encouraged and developed by the state. Educational institutions across the state are now working collaboratively sharing expertise and insights with each other, businesses and communities. Businesses are doing the same.

An example is Maine Built Boats. Governor Baldacci brought the industry together in 2005 to promote Maine’s unique boat builders to the world. Until then they were working independently, and competing against each other. Once they realized they were stronger as a consortium, sales increased and their innovative designs improved working with the University of Maine’s composite labs.

State government has proven to be a valued partner with the private sector to help grow jobs. CB Insights said that Maine leads the nation in investments in early-stage, innovative companies.

Three years ago a Governor’s Task Force under the direction of Karen Mills identified areas where cluster development should be enhanced. Mills is now the U.S. Administrator of the Small Business Administration. Mills recently stated that she is implementing the same programs on a national level using Maine as a model. Her work for Maine culminated when voters approved bonds for cluster development. Those bond investments manifest as The Maine Technology Asset Fund (MTAF), administered through The Maine Technology Institute.

According to Maine’s DECD every dollar awarded leverages more than $14 in public and private funds for the innovation economy. In 2008 even though the economy was in decline, Maine’s technology companies had a 36 percent growth in revenues. The average wage for a technology sector job is $48,000 dollars.

According to the PEW Charitable Trust, from 1998 to 2007, Maine green jobs grew by 22.7 percent compared to 9.1 percent nationally. Over the past five years state government has put an emphasis on building the state’s clean energy economy.

Maine is poised to become America’s leader in off-shore wind development. MTAF grants helped to fund research at the advanced composites lab at UMaine. Now the lab is beginning to build Maine’s first offshore wind platform. The goal is to build floating off shore wind platforms that will generate enough electrical energy for Maine’s needs as well as exporting the excess energy. The UMaine lab also helped in the development of the composite technology used in Ocean Renewable Power Company’s successful tidal generation project— which was initially funded by a MTAF grant, and just received an additional one.

Last year Ocean Energy legislation became law setting perimeters and regulations for this valuable sustainable resource. Public input was requested and reviewed. The new laws simplify the effort businesses need to take for certification and have taken the needs of fisherman and coastal communities into account.

The last legislative session saw 39 new energy bills pass. They dealt with helping weatherization efforts, creating a transmission corridor to conduct electrical energy to the Boston market and insuring communities benefit from wind developments. Combined with previously laws, recently passed, Maine has set the stage for burgeoning growth in the alternative energy sector.

All this is critical because climbing out of the Great Recession requires building a sustainable economic pathway to the future. That road is an innovation economy with a strong emphasis on clean energy innovation.

All these efforts need to continue. They represent an identified area of Maine’s economy that is growing. The clean energy economy has been equated to the next industrial revolution.

And the exciting thing is; Maine is in the forefront.

But that edge will only continue if the next governor understands how important; fiscal responsibility, consolidation efforts, maintaining core services, expanding sustainable forestry and lands preserved are. As well as growing the innovation economy by keeping Pine Tree Zones, spurring educational efforts, and creating new bonds to support grants for cluster growth. It’s a foundation that took eight years to build-now that’s a sensational story.