Congressman Mike Michaud in his Waterville, Maine office. Photo By Ramona du Houx

January/February 2008

Interview & photos by Ramona du Houx

“Why can’t we have one?” was the question Second District Congressman Mike Michaud asked, once he learned about the Appalachian Regional Commission (ARC). Michaud serves on the Economic Development Subcommittee of the Transportation Committee, and when they were reviewing the progress ARC had made, the then newly elected representative from Maine envisioned how beneficial it would be for Maine and the Northeast region to have a similar commission. Three years later in October, the Regional Economic and Infrastructure Development Act of 2007 — a bill which contained the congressman’s Northern Border Regional Commission — passed in the House of Representatives by a vote of 264-154.

“The bill moved forward quite rapidly. We had hearings in the last Congress as well as this one. This Congress had strong bipartisan support, particularly in the New England states, and with Jim Oberstar, the chairman of the committee,” said Rep. Michaud. “We have a real chance to create a stronger economy. We have a capable workforce, incredible natural resources, and a tradition of hard work and excellence that has sustained our economy for generations. The opportunity is huge.”

Other regional bills took a back seat to Michaud’s, as its potential for economic growth in areas of real need took precedent.

“We were able to get the bill passed despite the threat of a presidential veto, with strong bipartisan support in the Legislature for the bill,” said Michaud.

f53b44ebe184c27d-michaudThe president tried to claim that the legislation was duplicating programs already in existence. “It’s not duplicative of other programs, like EDA or SPA programs. It’s actually meant to complement those programs. It’s designed to help the regions in the state that need the help the most. The commission can expand the scope to cover more counties, once it’s up and running, where there is a need,” said the congressman. “If you look at the 36 counties that would become part of this commission and that lie on the border or right next to the border between Maine and Cayuga County, New York, you find poverty above the national average, median household income that is more than $6,500 below the national average, persistent unemployment fed by constant layoffs in traditional manufacturing industries. Our region has a common set of challenges with the communities in ARC, and a compelling need for investment and new growth.”

The investment funds are substantial enough to make a dramatic impact in targeted areas.

“It starts off with $40 million a year spent in $5 million increments. The only requirement is that 40 percent has to be spent on public transportation infrastructure, or telecommunication infrastructure. I’m really excited about it because it will help us tremendously in Maine.”

The commission would be charged with investing the money in federal resources for economic development and job creation in the most distressed areas of Maine, New Hampshire, Vermont, and New York, based upon ARC’s blueprint for success.

“ARC was created by Congress in 1965. This federal-state partnership was charged with promoting development in the depressed Appalachian region through regional planning, technical assistance, and funding of projects aimed at encouraging economic prosperity,” said Michaud. “It was a bold idea, and it worked. According to the National Association of Development Organizations, since its creation ARC has reduced the number of distressed counties in its region from 219 to 100, cut the poverty rate from 31 percent to 15 percent, and helped 1,400 businesses create 26,000 new jobs since 1977.”

“We built the legislation from the bottom up, working with economic developers in Maine, municipal folks, state and local officials. I talked to a lot of businesses about how to expand their businesses and entrepreneurs wanting to know how to get their business up and running. We took all these factors into consideration based on the format of the ARC legislation,” said Rep. Michaud.

The bottom-up approach, working with local communities, state and local municipalities, and concerned citizens in their areas, is an approach adapted by state government since the Brookings report came out in 2006. Gaining the knowledge of exactly what those communities envision they need to succeed will help guide where the federal funds are spent. As the federal government coordinates with the governors who will sit on the commission, there shouldn’t be programs duplicated. The process should streamline where needed funds should be invested, at the same time augmenting the existing programs in any given area.

“The commission will put forth a plan on how to move forward. The commission will be made up of the four governors with an individual appointed by the president and confirmed by the Senate. We need a strong federal-state partnership. The appointed federal person will help coordinate other programs that are already in existence, so there won’t be any duplication,” said Rep. Michaud. “The whole idea is to enhance what is currently out there.”

The Governor’s Council on Maine’s Quality of Place and The Governor’s Council on Innovation, Jobs and the Economy, along with other state agencies and personnel, have already identified various programs across the state that are moving forward to help Maine grow in the right direction in the global economy. The groundwork of where money could be invested has been laid. These federal funds could jumpstart the economy in all the counties of the Second District and the Northeast region.

“Federal investment in our region would help us capitalize on our great assets to create jobs and build our economy,” said the congressman. “If you have a community that is looking for a Community Block Grant or other federal programs that might need matching funds to qualify for a grant, money from this program could be used. Normally you can’t match federal funds with federal funds. This program is an exception that should help tremendously.”

Since ARC’s inception the poverty rate has declined and continues to decline. “The money spent in ARC has come back ten fold. That’s extremely important. For every dollar that is spent in the ARC there is an additional $2.47 spent form other public funds and $8.40 from private sector funding,” said Rep. Michaud. “The bottom line is — the poverty rate in ARC was cut in half. This has potential.”

With Maine’s economy transitioning into the global economy, funds are needed in identified areas. The congressman identified some areas that would benefit from investment from the commission to help Maine’s economic growth.

Education component —

“ARC has funded education projects. There’s going to be a point in time in the paper industry when people aren’t going to go into the mill, as their father and grandfather had done before them. The ups and downs of the industry make it hard. There actually will be a shortage of workers in the industry. Some of these funds could be used to help community colleges with courses that address that shortage. Also community colleges need more access to ATM technologies and other courses to help train workers in this new economy.

“Funds could be allocated to research and development at UMO, which would attract businesses and researchers while helping students. The bottom line is that it will help grow the economy, so we can be on the cutting edge of R&D for this new economy.”

In agriculture and traditional industries —

“It will focus a lot on our natural resource-based industries: forestry, agriculture, and fishing. One of the problems that I have seen, because of unfair trade policies, is we have lost 23 percent of our manufacturing base alone. It could help keep the mills we have keep going. By identifying waste product such as sludge and adding value to it, or by better utilizing wood fibers.

“Some funds could be allocated to research and development, whether it’s for celluloses or trying to find better use for pulp — which would help facilitate the development of these new energy resources. That’s when we could solicit the help from the UMO technology center to help move our traditional industries into the 21st century.

“This effort will help stop the loss of manufacturing jobs.”

With infrastructure —

“ARC has leveraged projects to expand highways and redevelop rail lines. It can be hard for lobstermen shipping lobster from Washington Co. Research could be done to find out the best way to help local businesses move their products, so they can ‘get there from here.’ Then investment could be made to make it happen.

“If a municipality that is looking for an expansion but are stopped by the cost of wastewater treatment, this program could upgrade the wastewater treatment for an expansion.

“With broadband Internet infrastructure it could be vital. If you look at Jackson Labs, they are concerned about the Internet infrastructure. It affects their business directly. We have to attract more high-tech businesses in this new economy. It’s extremely important. Everything we do today in some form or another has to access telecommunications networks.”

Health care —

“ACR has improved health care by recruiting physicians to rural areas and expanded telemedicine. With telemedicine communications, hospitals could link to other professionals around the nation and the globe. In rural hospitals, state-of-the-art equipment could also be purchased”

For tourism and land conservation —

“ARC has helped the tourism industry, funding cultural heritage trails. We could purchase access to land, build snowmobile bridges, expand trails for bikes and other recreational purposes.”

Making Maine a destination —

“A lot of CEOs and business people would remark to me when I was in the Maine Legislature that they were really impressed by the quality of life and the workforce they found in Maine. But, they said Maine doesn’t do justice to itself in the way in which it is marketed. A lot of the CEOs felt we were just a vacationland, not an area where they could set up businesses. We have to get the word out about how great a place Maine is for business. Funds could also be allocated to help market Maine through creative economy initiatives.”

“The overall purpose of having a federal commission for the region is to help facilitate economic growth in areas of need. These funds can help meet an unmet need that is currently out there. It should provide economic opportunities, so that folks that want to stay in the area in which they grew up can. So when they are ready for a job, there will be one available with good pay and healthcare benefits,” said Rep. Michaud. “The concept behind this Northern Border Commission is to make economic opportunities happen. It will raise aspirations and the quality of life for people.”

By 2012 the funds should increase to $60 million per year.

The next step is for Maine’s U.S. senators to put forward a form of this proposal in the Senate. “They helped through the initial process,” said Michaud. “ARC has proven the worth of a federal commission. The Northeast region is in more dire need than ARC now. We know that we have all the tools we need in our state and our region to build a bright future for our children. I want to make sure that the federal government gives us the investment we need to make this future a reality,” said Michaud. “Using this investment, we can build needed infrastructure, help develop new opportunities for small businesses, create new energy technologies, and capitalize on the value of our incredible natural-resource base. We can keep Maine ‘the way life should be’.”