LePage lies about being kept in the dark regarding State expenditures

Two weeks ago Mario Moretto reported that Gov. Paul LePage told a meeting of the Maine State Chamber of Commerce that he would sit on tens of millions of dollars in bonds if the Legislature moved to restore $40 million in Revenue Sharing. In January 2013, LePage had proposed to eliminate all $200 million in Revenue Sharing, a program that returns sales and other tax revenues to towns based on need.

Concerned by this report, State Treasurer Neria Douglass wrote to Gov. LePage, noting that to date nearly $52 million dollars had been expended from the Treasury, and that these funds would need to be replaced by the sale of the aforementioned bonds.

In a three sentence email, LePage responded:

I will not approve going to market until there is $60 MM in the Rainy Day Fund. I will not subject the state to further credit reduction. In the past the Treasurer would keep the Governor updated on cash expenditures, you have chosen not to.

In response to a request for clarification, Treasurer Douglass sent the timeline below listing all contacts her office had with the Governor’s. It clearly indicates that Douglass wrote to LePage three times concerning cash expenditures, the last of which was just last month:

7 August 2013: Provided updated spreadsheet to Admin and requested cash transfers of $21.5M to bond accounts (OSC);

Provided updated spreadsheet to Admin and requested cash transfers of $21.5M to bond accounts (OSC); 30 September 2013: Provided updated spreadsheet to Admin and requested cash transfers of $5.5M to bond accounts (OSC); and

Provided updated spreadsheet to Admin and requested cash transfers of $5.5M to bond accounts (OSC); and 14 January 2014: Provided updated spreadsheet to Admin and requested cash transfers of $24.2M to bond accounts (OSC)



The LePage administration did not respond to a request for an explanation of the contradiction in the Governor’s email and the timetable above.

The Legislature has since enacted LD1762, which restores the $40 million in Revenue Sharing cut last year. Gov. LePage has until 24 February to act on the bill. When asked about LePage’s order to not issue bonds, Nicole Johnson, an analyst at Moody’s Investors Service, a bond rating agency, said, “The Rainy Day Fund is there to be used; but should not be a structural part of the budget.”

Eliot Cutler, who is hoping to unseat LePage this fall, issued this prepared statement regarding LePage’s order to withhold bonds:

I have spent most of this week in Hancock County, where the roads are worse than they’ve been in the memory of most voters — and where the economy depends upon our ability to move goods and tourist traffic safely, efficiently and comfortably. The fact is, because of the Governor’s refusal to do his job, submit a budget, and issue authorized bonds, Maine will extend a sorry three-year record of failing to borrow money at some of the lowest interest rates we will ever see — money that could have been used to put people back to work rebuilding our crumbling infrastructure.

Supplemental Bond Info Sent to Gov LePage’s Office From Maine Treasurer by gerald7783