Correction: Pension Reform Saves Maine Taxpayers $1.7 Billion

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This is an update to the this morning's email regarding the financial impact of pension reform.  An omitted paragraph outlining the new tax cut package has been restored, and appears below.  We apoligize for the omission.   
 
 
Pension Reform Saves Maine Taxpayers $1.7 Billion
 
One of the big victories for Maine taxpayers were the pension reforms included in the recently passed state budget.  The changes limit the growth of retirement benefits for 75,000 teachers and state employees.  This reduces the stifling $4.1 billion pension debt to $2.4 billion, a stunning 41%.
 
This huge $1.7 billion debt reduction achieves two things:

1. The retirement plan is now more fiscally sustainable because it's more affordable for state government.  Our teachers and state employees should have more confidence that the pension checks will be there when needed.

2. Maine taxpayers will now spend $150-275 million PER YEAR less over the next 17 years until the debt must be paid off.

These huge annual savings are being used to create a business-friendly climate in Maine to attract capital investment and jobs.  The resulting increased economic activity will generate more tax revenues so we can better fund state government services, and pay our bills on time.

For example, the new two-year state budget includes a tax cut for 460,000 fellow Mainers. 70,000 low-wage earners will pay zero Maine income tax.  Businesses will get a tax break for investing in new job-creating equipment.  The death tax exclusion has been doubled.  Now, more family farms and small businesses can be passed on to future generations instead of being sold to pay the Maine death tax bill.  Don't believe the naysayers who proclaim this $150 million tax cut is for the rich.  It's not.  

It's all part of the overall strategy to reduce the cost and complexity of living and doing business in Maine.  The new leadership team in Augusta is steadily putting the pieces in place to turn this battleship in a different and healthier direction.  More good work ahead!

Best wishes,

Bruce

 

(Mr. Poliquin's comments are as State Treasurer, not as a Trustee of the Maine Public Employees Retirement System.)

For related information and media, visit www.maine.gov/treasurer/outreach.