Legislators answer letter writer regarding ‘no’ vote on LMF bond

By Wayne E. Rivet

Staff Writer

When Daniel Crofts of Casco saw that an attempt by legislators to advance Land for Maine’s Future bond sales despite the governor’s opposition fell just short of the two-thirds majority needed, he looked to see how local representatives voted.

His question became, why did they vote against the measure?

Crofts wrote the following letter to the editor:

To The Editor:

For almost three decades, the Land for Maine’s Future program (LMF) has issued long-term low-interest bonds to protect our state’s natural landscape and recreational resources — its working farms, mature forests, panoramic mountains, blue lakes, still ponds, and teeming rivers. LMF provides ocean access and trails for snowmobiles and hikers and bikers.

Six different times between 1987 and 2012, Maine’s voters have shown through popular referenda that they want LMF. So does the Sportsman’s Alliance of Maine. So does the Nature Conservancy. So does the Appalachian Mountain Club. And so does the Maine Coastal Heritage Trust.

LMF directly benefits the Lake Region. Loon Echo Land Trust has leveraged support from LMF with contributions from private donors, foundation grants and generous appropriations from town meetings to conserve many of the scenic wonders that make this area so special — Pleasant Mountain, Bald Pate Mountain, Pondicherry Park and Hacker’s Hill. Loon Echo Land Trust has campaigns underway to preserve the Raymond Community Forest and the Crooked River Forests in Otisfield and Harrison.

Unfortunately, Governor Paul LePage has repeatedly tried to undermine LMF by refusing to sell voter-approved bonds. His arbitrary actions have endangered many outstanding initiatives, including the ones pending in Raymond and Crooked River.

On Thursday, July 16, the Legislature nearly agreed to advance LMF bond sales despite the governor’s opposition. The Senate did get the required two-thirds majority, 25-9, but the margin in the House was 91-52, a substantial majority, but not quite the needed two-thirds. Had five House members voted differently, LMF could have issued its bonds and our children and grandchildren would have reaped the benefits from this splendid future-oriented land conservation program.

LMF enjoys broad bipartisan support in the legislature, including members of both parties from the Lake Region — Representatives Christine Powers of Naples/Sebago, Patrick Corey of Windham, Mark Bryant of Windham, Michael Shaw of Standish, and Senator Bill Diamond of Raymond/Casco/Windham/Standish. They should be commended for their votes.

Unfortunately, other local legislators voted against LMF. They include Representatives Mike McClellan of Casco/Raymond, Phyllis Ginzler of Bridgton/Denmark/Harrison, Susan Austin of Gray/Casco/Raymond, Nathan Wadsworth of Fryeburg/Lovell/Brownfield/Porter/Hiram, Tom Winsor of Sweden/Waterford/Norway/West Paris, and Senator James M. Hamper of Bridgton/Naples/Harrison/Oxford/Otisfield/Fryeburg.

Had McClellan, Ginzler, Austin, Wadsworth and Winsor voted the other way, LMF would have been able to continue its fine work. But they chose instead to leave it in limbo, subject to the whims of the governor rather than the will of the people. I find it difficult to understand the actions of these five House members from the Lake Region. They owe their constituents an explanation. And so does Senator Hamper.

The News reached out to those legislators who voted against LMF for their responses. The following legislators responded to the request and stated their positions:

Senator James Hamper

Senator James Hamper

Senator James Hamper: Two different issuance of LMF bonds bills were considered this year, LD 1378, An Act To Amend the Laws Governing the Issuance of Bonds and To Effectuate the Issuance of Bonds To Support Maine's Natural Resource-based Economy, and LD 1454, a Resolve, Reauthorizing the Balance of the 2009 Bond Issue for Land Conservation Projects.

In my opinion, LD 1378 would have taken authority from the office of the Governor and in turn place it in the hands of the State Treasurer. I was not willing to make that change, regardless who the Governor is.

LD 1454 was a much simpler solution to the issuance of LMF bonds. This bill extended the time period of issuance of approved LMF bonds an additional eight months without any changes in power or authority.

State Representative Sue Austin: The original language of the bill was limited and targeted as an “LMF bond bill,” but it was amended to change the current process for issuing all general obligation bonds, not just Land For Maine Future related bonds. http://www.mainelegislature.org/legis/bills/getPDF.asp?paper=SP0508&item=2&snum=127

In considering this bill, I felt it was extremely important to recognize that changing our existing bonding process, which is complex, is not a decision to be taken lightly. Currently, we satisfy the requirements of the Maine Constitution; the IRS (who can take away the tax-exempt status of our bonds); and the bond market. L.D. 1378 would alter that system and create uncertainty regarding future borrowing. I’m concerned that creating uncertainty of this nature could result in higher borrowing costs for Maine’s taxpayers.

Representative Sue Austin

Representative Sue Austin

The voters’ role in the process is to grant the state the authority to bond, but the actual borrowing is not a requirement. It may or may not happen depending on a variety of circumstances. To that end, the Maine Constitution anticipates that not all bonds will be sold; that is why the bonds have a five-year expiration date with a window of time to extend the expiration date by another five years.

I considered this bill to have a far-reaching impact into the future regarding the governance of bonding.

I feel that this legislation would have eliminated not only the current governor from the bonding process, but all future governors, forever changing the way we work through and issue bonds. I gave this matter a lot of thought and felt it was irresponsible to potentially put Maine’s financial future at risk by permanently leaving the bonding process solely in the hands of the Maine State Treasurer, who is not an elected official. I base my votes on what I consider to be in the best overall interest of my constituents and the people of Maine for not only the present, but the long term.

State Representative Mike McClellan: I voted against the bill that in part would have moved Lands For Maine’s Future (LMF) forward. While it was a difficult decision, it was the correct one in my eyes. One of the “traps” in being involved in the Maine Legislature is that people (including legislators) only consider the issue of the moment, the one being discussed. Even more interesting is that then the next issue comes up and that becomes “the most important issue ever” and needs to pass. I suppose it is a way some people use to make sense of filling so many needs and desires, seizing so much taxpayer monies. I don’t choose to govern that way.

Representative Michael McClellan

Representative Michael McClellan

The Maine Legislature was in session just after New Year’s, and the Governor proposed his budget sometime just after that date. The bonds were in play at that time. Then, the Maine House and Senate proceeded to do little and wasted great amounts of time until late May. The strategy of piling the work into a few weeks in June, causing urgency and the fear of a government shutdown works with some people.

I was elected to oversee all aspects of the budget and not to fall for the fear tactics that both parties use to get bills passed. The final budget passed was termed bi-partisan in local papers. Good work also. However, I am not sure I saw that it was stated that the new budget was $300,000,000 more than the previous budget cycle. I won’t go into the various ways money will now be seized from you to fund lobbyist and legislative projects, but I will point out that the various waiting lists (people with special needs requiring supports) was again largely ignored. This troubles me greatly as I believe government exists to help people needing a step up. These people have waited years for help. They will wait some more.

In the final hours of this session, we were asked to consider the bonding monies. If LMF is a priority, why wasn’t it in a budget spending $300,000,000 more than the last budget? What many do not know and major media did not seem to report was that the bill we considered would have taken the governor AND all future governors out of the bonding process. It would have changed the balance of the process in a way I was not comfortable with. If you argue the Governor was being political with the bonds, then wasn’t the sponsor of the LMF bill being political, too, in trying to change the process forever? The bill failed and then the governor submitted a bill to allow the bonds to extend past their November deadline for usage. Perhaps a hopeful sign? If the goal was to pass bonds, this would have been a vehicle. House Democrat leadership then attached an amendment that again, removed the Governor from the process. This is the act that actually ended the bond process although I am guessing the state media did not point that out. Taking all future governors out of the process would mean giving your state representatives and senators a blank check for bonding.

Mr. Crofts, would you support taking the checks and balances out of the bond process? You already have many elected officials who celebrate spending your hard-earned dollars (see the first list of names you presented in your letter). I was not willing to make that change.

The legislative process is broke in many ways. I just explained one to you. The responsibility to help in managing the state is a humbling one, one I take very seriously. Every person who challenged me on this by e-mail or call, acknowledged they did not know the twist in the bill.

In closing, I mentioned the issue of the moment in my opening. I believe my responsibility is to look at the entire package, everything. While I agree voters approved this bond, they also approved other items in the past such as funding education at 55%, which was never done. I appreciate your letter, your disappointment and call for accountability. I hope I have presented my thought process adequately.

Representative Phyllis Ginzler

Representative Phyllis Ginzler

State Representative Phyllis Ginzler: I appreciate the opportunity to discuss the issues regarding the release of the Land for Maine’s Future (LMF) bonds and LD 1378. As your state representative, you have entrusted me to dig into this issue and vote what is best for the people I represent.

Before I get into the weeds, I want to reiterate that I am in favor of releasing the Land for Maine’s Future bonds. Maine, and in particular, our Lake Region’s beautiful landscape, must be preserved and so must the integrity of the will of the people.

But, LD 1378 was not just about LMF bonds. Certain aspects of this bill would harm Maine’s future. If passed, LD 1378 would dramatically alter the process for issuing all General Obligation (GO) bonds, not just the bond that funds Land for Maine’s Future, as some believed. It would result in a shift away from the safeguards and oversight that has been in place for decades. The Governor is not doing the right thing by holding the bonds and not releasing them at this time, but LD 1378 was not the right solution.

Here is how bonding actually works: GO bonds are the vehicles used to pay for large capital improvements over time. This long-term financing mechanism, in addition to funding land conservation projects, is used to fund education, infrastructure, economic development, economic development and a host of other public projects. These capital investments are paid over a period of time (usually 10 years) and are approved by a 2/3 vote of the Legislature coupled with a majority vote of Maine citizens when they appear on the ballot.

Once approved, projects become Authorized but Unissued GO Bonds (AUB). The state has five years after the citizen vote to sell the bonds in the bond market. In the event that the bond is not released for sale, the Legislature may reauthorize the bond for an additional five years. The decision when and under what terms to release the bond for sale resides with the Governor, the State Treasurer and the Commissioner of Administrative and Financial Services. It is a system of checks and balances of responsibility for the taxpayers’ credit card.

LD 1378 would place this responsibility solely in the hands of the State Treasurer. The Treasurer is not an elected official, but is usually chosen by the majority party in power. We have had excellent Treasurers from both sides of the aisle, and some, well, not so much. The actual job requirements are minimal.

Current statute protects our bond rating by requiring the governor’s signature for the sale of all general obligation bonds, which in times of economic turbulence, such as the recession, can be critical to help maintain our state’s credit rating. This has been a process that has worked for decades and provides one more check to ensure our state is managing its debt responsibly. It has resulted in Maine’s credit rating remaining strong and improving even in the middle of the last great recession.

Lastly, if LD 1378 had passed it would have ended up in court and the bond would not have been released, and thus securing funding by June 2016 was out of the question. A better solution was to focus exclusively on LMF bonds. LD 1454, a Resolve Reauthorizing the Balance of the 2009 Bond Issues for Land Conservation, (until June 30, 2016), which I supported, passed in both the House and Senate.

Let me be as clear as possible. We need to release the bonds, but LD 1378 was not the right avenue to go about doing that. We shouldn’t be removing executive authority, as our state credit rating will likely be lowered. I can’t support legislation that will damage our credit rating. Maine taxpayers deserve better.

I hope this clarifies my position, and I am confident that in time, the bonds will be released. Until then, I owe it to my constituents to consider the importance of keeping accountability and transparency in the bonding process.


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