AUGUSTA—Gov. John Baldacci’s budget plan for the next two years would decrease overall spending for the first time in at least 35 years while changing or reining back services across state government.

Among the proposals contained in a several-hundred-page document released to the Legislature and reporters Friday, January 9 are initiatives ranging from the elimination of 219 positions and increased license fees for outdoor sportsmen and natural resource-dependent businesses.

 The overall budget proposal of about $6.1 billion is roughly $200 million less than the current fiscal year. In addition to numerous new initiatives, the proposal carries forward many of the items under debate in legislative committees that are part of Baldacci’s supplemental budget proposal, which affects spending between now and June 30. The biennial budget proposal released January 9 is for July 1 through June 30, 2011.

The proposed supplemental budget and biennial budget reductions are the result of falling tax revenues in virtually every category. Despite that, Baldacci does not recommend broad-based tax increases nor using any of the state’s reserve funds.

“There will be temptations to raise broad-based taxes to support important programs,” said Baldacci. “Raising the sales or income tax to support spending is not the right approach. We must be disciplined and mindful that this national economic crisis is already placing great strains on the people of Maine.”

The proposed cuts would have been deeper, particularly in the Department of Health and Human Services, but Baldacci “conservatively” estimates at least $98.8 million coming to Maine in Medicare funding from President-elect Barack Obama’s economic stimulus package. That package, which Congress hopes to approve in the next few weeks, could include considerably more funding for Maine in a range of areas. Baldacci said it would be fool-hardy on one hand to depend on that money before it’s approved or on the other hand, to propose deeper budget reductions when stimulus funding is expected.

“If the time comes that we need to find an alternative to this approach, I am prepared to do that,” said Baldacci.

Among the proposed cuts are the following:

• A requirement for some state employees to pay a portion of their health insurance premiums, amounting to 5 percent for employees earning $50,000 to $89,000 per year and 10 percent for those earning more than $90,000.
  
  
• The elimination of 219 positions, including 139 layoffs, which will bring the number of state employees to its lowest level since 1983.
  
  
• Offering state employees who are older than 60 and have 25 or more years of service retirement packages including a $10,000 lump sum payment. There are about 500 people in state government who would be eligible for this provisions, said Ryan Low, commissioner of the Department of Administrative and Financial Services, during a briefing to the Appropriations Committee following Friday’s press conference.
  
  
• Instituting temporary 10 percent reductions in tax rebate programs, including the Circuit Breaker, the Business Equipment Tax Reimbursement Program, the Maine Tree Growth Program and state-municipal revenue sharing. The Homestead Exemption would not be reduced under Baldacci’s proposal.
  
  
• Increasing fees in the departments of marine resources, inland fisheries and wildlife and conservation, which overall will total and estimated $4.1 million in new revenue. This affects hunting and fishing licenses, professional license fees for businesses dependent on natural resources, like lobstermen, and admittance to state parks and historic sites.
  
  
• Flat-funding state aid for education, resulting in the state paying 50 percent of education costs in fiscal year 2011.
  
  
• Tightening eligibility requirements in a number of programs administered by the Department of Health and Human Services.
  
  
• Shipping certain inmates in the Department of Corrections – particularly those serving long sentences who have few family ties to Maine – to privately run prison facilities outside the state. These prisoners will be brought back to Maine when they have one year left on their sentence. Baldacci also proposes to double-cell two pods at Maine State Prison, which will free up 84 beds.
  
  
• Closing portions of some Department of Corrections facilities, including those in Warren, Machiasport and Windham. No facility is proposed to be closed completely.

Baldacci also announced that in separate legislation, he will propose merging the state’s four natural resources agencies – the departments of conservation, agriculture, inland fisheries and wildlife and marine resources – in to one agency. He will also propose restructuring the Department of Economic and Community Development to emphasize a more regional approach.

“Maine will be tested by the current national recession and other unforeseen challenges,” said Baldacci. “Our parents and grandparents suffered through the depression and world wars. They understood that tough times require sacrifice and ingenuity. They made those tough choices and built a more prosperous world. We will do the same.”