Democrats propose quadrupling Maine’s bond debt in first month of new Legislature

AUGUSTA – Maine’s current general obligation bond debt is about $376 million, but Democrat lawmakers eager to flex their muscle with control of both chambers of the Legislature and the Governor’s office have proposed almost $1.27 billion in new general obligation bond debt in just the first month they have been serving in Augusta.

The bills to borrow money for a variety of reasons total twenty in number, and range from a proposal to borrow $50 million to “address sea level rise” to borrowing $15 million to “invest in smart city technology” and a proposal for $150 million in borrowing to construct a new convention center in the city of Portland from Gorham Rep. Andrew McLean, among other purposes.

According to the Maine Treasurer’s Office, Maine is set to make debt service payments totaling almost $93 million on Maine’s existing general obligation bond debt this year, that amount includes over $20 million in interest payments on the existing debt.

Of the twenty Democrat-sponsored bills to borrow money that are currently up on the Maine Legislature’s bill tracking website, twelve bills have zero Republican cosponsors.

Lack of bipartisan support hasn’t stopped Democrats, however, as most of the borrowing bills that have failed to win Republican cosponsors are stacked with four to nine Democrat cosponsors in support of the new borrowing.

One bill, a bond to expand rural broadband internet access has won four Republican cosponsors of the nine total cosponsors on the bill.

Under Maine’s Constitution, lawmakers must pass general obligation bonds by a 2/3 majority in both chambers of the Maine Legislature and then the proposal must be approved by a majority of voters in a statewide vote.

Maine taxpayers are typically on the hook for paying off bonds in a 5 to 10 year time frame, with interest rates varying based on the bond market, the state’s credit rating and the purpose and size of the bond. Maine typically makes payments on bond debt twice a year.

According to Moody’s Investors Service, tax-supported debt per Maine resident is $900. The national median is $986.50.

Tax-supported debt as a percentage of Maine personal income is 2.0%. The national median is 2.1%. (Moody’s Investors Service).

Maine has no statutory debt ceiling.

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