RPS law burdens households, harms Maine’s economy 

Maine’s Renewable Portfolio Standard (RPS) legislation, which requires that some of the state’s electricity must be generated by expensive “renewable” sources, will increase the cost of electricity by $145 million within five years and will cost the state nearly 1,000 jobs.

According to the new study, “The Economic Impact of Maine’s Renewable Portfolio Standard,” the state’s electricity prices will surge eight percent by 2017, thanks to the RPS law.

That means homeowners will pay $85 more a year for electricity—and businesses will pay over $600 more a year—because proponents of “green energy” have mandated that a certain percentage of Maine’s electricity must come from wind power, solar and other “green” energy sources.

Hydropower is a clean, abundant, reliable and affordable form of “green” energy that is readily available to Maine. Using more hydropower could easily reduce electricity costs to consumers and businesses. But it is excluded as a source of “renewable energy” from RPS.

Owners of industrial businesses are hit the hardest by RPS, according to the study. Maine’s largest employers will see electricity costs increase by a staggering $14,350 per year because of the burdensome RPS law.

The study, published by The Maine Heritage Policy Center in partnership with The Beacon Hill Institute at Suffolk University in Boston, concludes that, “increased energy prices will hurt Maine’s households and businesses and, in turn, inflict significant harm on the state economy.”

Maine’s first RPS law was created in 1999 under former governor Angus King. The RPS law was then strengthened in 2006 under former governor John Baldacci. In 2007, King and Rob Gardiner, the former president of the Maine Public Broadcasting Network, formed a wind-energy company, Independence Wind.

As a result of the RPS, the study found that in five years Maine will suffer from:

• Reduced employment by 995 jobs

• Reduced real disposable income by $85 million, potentially as much $100 million

• Decreased investment by $11 million

Scott Moody, a co-author of the report and CEO at The Maine Heritage Policy Center, said the study shows exactly why energy reforms are necessary.

“RPS was a mistake, and we see now that it’s a law that will cost Mainers jobs and real money,” Moody said. “It’s clear that when we let political and personal agendas drive policy-making instead of free-market principles, we end up with fewer jobs and less money in the pockets of hard working Mainers.”

Click here to see the report.

A report released today by the Maine Heritage Policy Center shows that Maine’s high-earning individuals are working married couples with dual incomes and risk-taking entrepreneurs who create jobs. This is in stark contrast to recent cries denouncing supposed “tax cuts for the rich” in response to modest income tax relief passed last year.

The report, Who are Maine’s “Rich?” profiles various levels of income tax filers, and shows that those earners who are in the higher categories are primarily families and small business owners. Mainers who earn $200,000 or more are primarily married (86.6%) and many are business owners (45.2%). Because of the higher income, often a result of business income that is held to cover liabilities and make business investments, these so-called “rich” pay higher effective tax rates than filers who earn less.

“This report shows how important a reduced income tax burden is to hard-working Maine families and small businesses,” said Scott Moody, the Chief Economist for the Maine Heritage Policy Center. “The big government advocates on the left are yelling about tax cuts for the “rich” but what they don’t seem to understand is that the people helped most by income tax reductions are entrepreneurs who create jobs.”

The study uses a hypothetical situation of two different taxpayers – one is single and makes $50,000 and the other is a family of four who has two incomes, some business income, and some capital gains totaling $175,000. In this scenario, the “rich” taxpayer is taxed on $50,000 in business “profits” that won’t actually be received by the individual, but will instead be invested back into the company. Still, this business income, combined with the dual incomes of husband and wife, leave the “high-income” taxpayer with a 9.9% tax burden as percent of actual income, while the single taxpayer, earning $50,000, has a tax burden of just 5.7%.

“What we see consistently is that folks who are taxed at higher rates for their earnings are the very people we rely on to create jobs and move our economy forward,” said Moody. “When the Governor and Legislature did the smart thing and gave these job creators much needed tax relief, the calls came out from the left to “tax the rich” – well I have news for them, the “rich” are Maine small businesses and hard working families.”

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For more information or to schedule an interview, please contact Peter Steele at psteele@mainepolicy.org or by calling 207-321-2550.

A study released today finds that allowing workers to decide whether or not to join a union can be great for a state’s economy. The report from The Maine Heritage Policy Center  (MHPC) shows that Mainers are leaving the state and moving to “Right-to-Work” states, or states where workers cannot be forced to join or financially support a labor union a t their place of employment.

According to the report, 15,694 Maine households, representing nearly 25,000 Mainers, moved from Maine to Right-to-Work states between 2003 and 2008. This out-migration of Maine workers represents $801 million in adjusted gross income.

On the other side of the spectrum, Oklahoma, since becoming a Right-to-Work state in 2003, has seen growth in population, gaining nearly 41,000 people and $99 million in income from 2003 to 2008 alone. Of the new Oklahoma residents, 31,367 relocated from non-Right-to-Work states. Before passing Right-to-Work, Oklahoma had lost 10,681 households representing $1 billion in income between 1995 and 2002.

“What is clear from the Oklahoma example is that Right-to-Work states are attracting new business, new residents and economic growth,” said Scott Moody, Chief Economist for The Maine Heritage Policy Center. “Maine has suffered from ‘brain drain’ and out-migration to Right-to-Work states for many years, and this study shows us one reason why – Right-to-Work states are providing better economic opportunity than we are.”

Additionally, the report found that by instituting Right-to-Work in Oklahoma, the GDP of the manufacturing industry, a staple of Oklahoma’s economy, increased by 45 percent from 2003 to 2010. This growth can be directly attributed to an increasingly productive workforce.

“Maine has a great opportunity to make a move that will undoubtedly boost our economy without costing taxpayers or government a dime,” said Moody. “By implementing Right-to-Work here in Maine, we are opening the door to increased workforce productivity and less out-migration of Mainers to Right-to-Work states.”

“For too long, forced unionization has held back economic growth in Maine,” said Lance Dutson, CEO of The Maine Heritage Policy Center. “This study demonstrates just how damaging that can be to the workforce and our population. It’s time to protect our workers individual liberty and open the door to economic prosperity by bringing Right-to-Work to Maine.”

Download the full report here (PDF)

A report released today by The Maine Heritage Policy Center (MHPC) shows that raising taxes to address the estimated $121 million dollar DHHS budget gap for this year would lead to the loss of more than 6,400 Maine jobs. As lawmakers work to decide how to fix the structural problems that have led to this massive shortfall, ultimately they will have to decide whether to decrease spending or increase taxes. The MHPC report indicates that a tax increase of this magnitude would cost Maine taxpayers $631 in lost personal income per household, or a total of 6,463 private sector jobs.

“Raising taxes to temporarily smooth over this problem would be a critical mistake,” said the author of the report, MHPC Chief Economist Scott Moody. “Maine’s private sector is already in a precarious situation, and we can’t afford to make it even more difficult for Maine’s families and businesses to get by in these tough times. A better solution is to address the structural budget problems that have led to this deficit and reduce government spending going forward.”

The report explains that the cost of a tax increase goes far beyond the initial price tag, showing that a $121 million dollar tax increase would ultimately remove $351 million in personal income from the Maine economy, a net cost nearly three times larger than the initial tax increase. The additional tax burden would further shrink the private sector in Maine, where private sector share of personal income is already at an abysmal 64.1 percent, ranking us at 39th in the country.

“Taking more money out of the private sector and funneling it to government will further damage our economy,” said Moody. “What we need in Maine to turn the economy in a positive direction is investment from our businesses and entrepreneurs. New taxes will keep people from investing and keep new jobs, the very thing we need most of all, from being created.”

“Decades of increased welfare spending have put us in this position, and we can no longer afford the tax-and-spend ways of the past,” said MHPC CEO Lance Dutson. “Progressive special interests and the welfare industry want to raise taxes on hard-working Mainers to protect their revenue streams, even if it means lost private sector jobs. Raising taxes is the last thing Maine can afford to do right now. Instead, we should focus on fixing the structural problems with the DHHS budget and reducing government spending to get us headed in the right direction.”

Download the Full Report Here (PDF)

Today, MaineOpenGov.org has been updated and expanded to show five years of salary and benefits data for employees of the Maine State Housing Authority (MSHA). The data from Maine Housing was provided in response to a Freedom of Access Act request made by The Maine Heritage Policy Center (MHPC). The data shows that in the past five calendar years (2005 – 2010) total payroll and benefits costs of Maine State Housing Authority employees grew by 30%, from $7,119,528 in 2005 to $9,370,550 in 2010. Current MSHA Executive Director, Dale McCormick, took over as head of MSHA in 2005.

Maine State Housing Authority Total Payroll Cost 2005 – 2010

“We’re excited to add another, brand new set of payroll data to MaineOpenGov.org,” said Sam Adolphsen, Director of Open Government at MHPC. “The Maine State Housing Authority handles a great deal of public money, and is responsible for providing critical services for our most vulnerable citizens. It’s vital that their operations are transparent, and that they are accountable to taxpayers for how they spend those public funds. This is particularly important at a time when 6,500 of our fellow Mainers find themselves on the waiting list for affordable housing.”

Other key findings from the MSHA payroll data include:

• Over the same time period (2005 – 2010) Maine State Housing Authority Payrolls have more than doubled the total payroll increases at the Maine Turnpike Authority, Maine State Government and the University of Maine System total payrolls.

Download the Full Study (PDF)

A new study says that Maine is lagging behind its New England neighbors in broadband accessibility and that without increased broadband depth, Maine will fall even further behind economically. This study shows that the broadband industry is strong and healthy in Northern New England. However, there are disparities among the 3 states that warrant attention. As measured by Gross Domestic Product (GDP), employment and average compensation, Maine has the weakest Information, Communications and Technology (ICT) industries while New Hampshire has the strongest ICT industry with Vermont straddling the middle.

The study indicates that Maine’s broadband problem is the lack of higher-speed connections (over 3 mbps) with a subscriber ratio half of the U.S. average (15 percent versus 33 percent, respectively). New Hampshire (53 percent) and Vermont (49 percent) both have significantly higher subscriber rates for higher-speed connections.

Recent academic literature regarding the economic benefits of broadband show one consistent finding—increased broadband infrastructure will add a significant number of jobs to the economy. One study found that a rapid adoption of residential broadband ubiquitously would eventually add just over 1.2 million jobs to the American economy.

“Broadband access is such a major part of our lives and is vital to businesses operating successfully in the 21^st century,” said the co-author of the report, Scott Moody, Chief Economist for The Maine Heritage Policy Center. “For Maine to be economically competitive and a place where businesses can flourish and hire new workers, quality, high-speed residential broadband must be available to everyone.”

Of the three economic impacts measured in the study—share of GDP, share of employment, and compensation per worker—Maine significantly lags behind the U.S. average, New Hampshire and Vermont. The study goes on to note that an increase in broadband access of just 7 percentage points would stimulate a half-billion dollars in economic growth and create or save nearly 11,000 new jobs in Maine.

“The facts are clear, increased broadband access means more jobs for Mainers,” said Moody. “If Maine doesn’t address the need for increased broadband depth with high-speed residential and business broadband, we will continue to fall behind our neighbor states economically, and creating new jobs will become even more difficult.”

Download the Full Study (PDF)

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For more information, or to set up an interview, contact Sam Adolphsen at sam@mainepolicy.org or call (207) 975-6617

The Maine Heritage Policy Center (MHPC) released a report today showing that steps must be taken to protect the integrity of Maine’s voting system. The report explains that Election Day Registration (EDR) is not a viable practice in Maine considering the many inadequacies found in the current structure of Maine’s voting system.

The report, “Protecting the Integrity of Maine’s Elections: Election-Day Registration in Maine,” was authored by MHPC chief executive officer Lance Dutson, vice-president of policy and chief economist Scott Moody, and research associate Amanda Clark.

“Free and open elections are the cornerstone of our democracy and a free and open election is one where every vote counts and is not negated by votes cast fraudulently or in error.” Dutson said. “This report examines our current voting system and indentifies areas of concern and ways we can address them, because the people of Maine must be confident in the integrity of our electoral process.”

Key findings from the report detail several startling issues with Maine’s voting system:

• In 3 of the last 10 general elections, there were more registered voters than voting-age citizens in Maine.
• 178,000 registered voters are shown to have registered to vote on January 1, 1850.
• There was an 84% error rate in registrations recently reviewed by the Secretary of State’s Office.
• 1,452 active registrants are listed as being 211 years old.
• 2,209 active registrants are listed as having no street addresses.

MHPC found that of the EDR utilization in Maine’s 2010 election, Republicans and Democrats utilized EDR at basically the same rate, both representing 24% of total EDR usage. EDR is rarely used across the United States, where 93% of all U.S. citizens are required to register to vote in advance of Election Day. The report notes that EDR has had no perceptible impact on voter turnout levels. In fact, Maine’s three lowest years of voter turnout in the last 50 years have occurred since EDR was implemented in 1973.

“Election Day Registration, while not practical now, is a laudable goal for Maine,” said Dutson. “It’s a good goal to work towards, but first we need to implement a stronger and safer voting structure. Election Day Registration should not be allowed until we can address the many inadequacies in our voting system. Managing the integrity of 972,000 registrations through the Honor System is simply not a reasonable way to conduct our elections.”

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Download the Full Report Here (PDF)

For more information, or to set up an interview, please contact Sam Adolphsen by email at sam@mainepolicy.org

Increased broadband infrastructure would add a significant number of jobs to the economy

Today, MaineOpenGov.org has been updated and expanded to show eight years of salary, benefits, overtime, and stipend data for employees of the University of Maine, as well as five years of checkbook spending information. Prior UMaine payroll data on MaineOpenGov.org did not contain overtime and stipend data, and included just three years of spending information. The data shows that in eight years, total payroll and benefits costs of UMaine employees grew by 29%, from $258,433,559 in 2003 to $333,108,621 in 2010.

“Giving Mainers a chance to see how government is spending their hard-earned tax dollars is the number one objective of MaineOpenGov.org,” said Sam Adolphsen, Director of Open Government at the Maine Heritage Policy Center (MHPC). “The University of Maine is a major recipient of tax dollars and tuition dollars and a key public institution in our state. It’s important that the operations of the University are transparent and their finances are available for everyone to see.”

Other key findings from the updated UMaine data include:

• The number of employees earning more than $100,000 in total compensation increased from 399  employees in 2003, to 1,018 in 2010.

• Fringe Benefits as a percentage of total payroll increased from 34.6% in 2003 to 48.4% in 2010.

• UMaine paid out $11.3 million in “stipends” in 2010.

• Former UMaine President Robert Kennedy earned $188,043 in total compensation in 2004, which climbed to $308,368 by 2010.

• $2,840,993 was spent on expense category “Travel” in 2010.

This updated data release comes after MHPC recently released a separate report regarding the University of Maine, and one of the findings was that the University struggled in the area of Cost and Effectiveness. The report noted that “from 2004 to 2009, in-state tuition and fees at UMS institutions increased by an average of 35 percent.” The tuition hikes during the same time period that the new data on MaineOpenGov.org shows an increase in payroll of nearly 30%.

“This data is important because it raises, and can answer, key questions that parents, students and taxpayers might have about UMaine operations,” said Adolphsen. “I think students will be interested to see where their 35% increase in tuition is being spent. Taxpayers and tuition payers deserve to know where their money is going.”

A recent study touted by the Yes on 1 campaign that claims repeal of Election-Day Registration (EDR) in Maine would disenfranchise voters has been exposed as false by a leading national expert on election law.

Hans von Spakovsky, a former member of the Federal Elections Commission and Justice Department voting counsel, examined claims made by the left-wing Brennan Center for Justice in a recent study. Spakovsky is a Senior Legal Fellow at The Heritage Foundation, and has written extensively about the pattern of questionable research released by the Brennan Center.

Mr. von Spakovsky writes that the Brennan Study “is dubious in its methodology and especially suspect in its sweeping conclusions. It is based on a survey of only 987 “voting-age American citizens,” although it contains no infor­mation on how it was determined whether a respondent was actually an American citizen entitled to vote, and might easily have included illegal and legal aliens, felons, and others who are ineligible. The survey then uses the responses of these 987 individuals to estimate, based on the 2000 Census, the number of Americans without valid documentation.”

The article calls the findings of the Brennan Study “fallacious” and “flawed”, and refers to the study and its support from newspaper editorialists as “myth-driven diatribes against common-sense election reform that the vast majority of the American people agree with, no matter what their race or political background.”

Mr. von Spakovsky also cites a recent report released by The Maine Heritage Policy Center on the issue of Election-Day Registration repeal:

“[The] Brennan Center claims that 630,000 potential voters will be affected by the elimination of Election Day voter registration in states like Maine because that is how some voters registered in 2008. Again, there is no evidence that such individuals will not register prior to Election Day like all other voters. The Maine Heritage Policy Center just released a study concluding that Election Day registration “had no recognizable impact on voter turnout in Maine since its implementation in 1973. In fact, the three lowest turnout years since 1960 occurred after EDR was implemented.” California voters defeated a 2002 referendum to implement Election Day registration 59 percent to 41 percent, and even such liberal newspapers as the Los Angeles Times and the San Francisco Chronicle warned against its implementation because of the potential for voter fraud.”

“The Yes on 1 campaign is becoming notable for its lack of candor surrounding the question of Election-Day Registration,” said Lance Dutson, chief executive officer of The Maine Heritage Policy Center. “From their misleading claims of an all-volunteer signature effort to their hollow claims of disenfranchisement, Yes on 1 continues to put forward erroneous or misleading information. The facts show clearly that Election-Day Registration repeal is a common-sense way to help ensure the integrity of our elections, and the people of Maine would be better-served through a more honest dialog about this issue.”

Mr. von Spakovsky’s article can be found here:
http://www.nationalreview.com/corner/279991/new-myths-voter-id-hans-von-spakovsky

MHPC’s study on Election-Day Registration can be found here:
http://www.mainepolicy.org/wp-content/uploads/The-Maine-View-Same-Day-Voter-Registration-100511.pdf

A decision by the Legislature to end the practice of same-day voter registration in Maine has the support of a majority of likely Maine voters, according to a new poll commissioned by The Maine Heritage Policy Center (MHPC).

According to the poll, 53 percent of likely Maine voters support the Legislature’s recent decision to end same-day voter registration, including 72 percent of self-described conservatives and 53 percent of unenrolled/Independent voters.  47 percent oppose the elimination, including 71 percent of self-described liberals.

Critics of same-day voter registration believe the practice makes it too difficult for municipal clerks to verify potential voters meet residency and legal requirements before voting, increasing the chances that fraudulent votes impact Maine elections.  Advocates for same-day voter registration claim that ending the practice will disenfranchise voters and severely impact voter turnout.

Supporters of same-day voter registration may not have much luck with this argument.  By a 55 percent to 36 percent margin, those polled believe it is more important to protect against voter fraud than it is to maximize voter turnout.

The poll also asked respondents whether they favor requiring voters to present photo identification at the polls before casting their vote, which 56 percent do, compared to just 41 percent who oppose voter ID at the polls.

“Our democracy relies on the integrity of our electoral process.  Our system must be sound, and the electorate needs to have faith in the legitimacy of our election results,” said MHPC Chief Executive Officer Lance Dutson.  “This poll shows that, while Mainers do not think fraud is a critical problem in our state, they do want safeguards to protect against it. Maine people understand that ending same-day registration helps protect the integrity of our system, and that the common-sense measure of requiring photo identification at the polls will help ensure Maine is safe from the kind of fraud and manipulation we see in other states.”

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CLICK HERE to view the top line results of the poll

CLICK HERE to view the full Cross tabs of the poll

The telephone survey of 500 Likely Voters in Maine was conducted by Pulse Opinion Research on September 7, 2011.  Pulse Opinion Research, LLC is an independent public opinion research firm using automated polling methodology and procedures licensed from Rasmussen Reports, LLC.

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For more information, or to schedule an interview, please contact Chris Cinquemani at chris@mainepolicy.org.