LePage's refusal to OK $117M in bonds puts 100s of projects at risk
Photo / Tim Greenway
Deb Fahy, executive director of Hallowell's Harlow Gallery, watches as work begins on the reconstruction of Water Street. The project is one of 350 construction projects involving 2,000 workers whose funding is jeopardized by Gov. Paul R. LePage's refusal to approve the sale on Tuesday of $117 million in bonds by last Thursday's deadline.
Gov. Paul LePage’s refusal to approve the sale of $117 million in bonds by last Thursday’s deadline puts hundreds of construction projects at risk, Maine State Treasurer Terry Hayes told the Bangor Daily News on Friday evening.
“The governor doesn’t have any more time,” Hayes told BDN’s State House reporters Christopher Cousins and Michael Shepherd. “He has already agreed to everything that was in the sale, but I can’t make him do it. I spoke with him [Thursday] afternoon, and he was adamant.”
The bonds are scheduled to be sold Tuesday and had a Thursday deadline for LePage to sign off on them in order for them to be closed in time. Hayes told the BDN she had notified entities that bought the bonds after a bidding process — Citigroup Global Markets and Wells Fargo — that the sales were now off.
LePage told BDN in a written statement Monday that he held up $117 million in voter-approved bonds that were to be sold Tuesday because of “excessive eleventh-hour legislative spending” by lawmakers as they work through a host of unresolved spending issues in order to bring the special session to a close.
LePage said he needed additional time to review the bond offering, adding that state government, in the meantime, "will use existing resources to fund key priorities, such as maintaining and improving our infrastructure."
'Thousands of jobs' at risk
House Speaker Sara Gideon, D-Freeport, issued the following statement this morning:
“Gov. LePage has put thousands of jobs, scores of vital infrastructure projects and the investment of Mainers hard-earned dollars in jeopardy for no discernable reason. It is irresponsible and incomprehensible. By imperiling $117 million dollars worth of state borrowing unless his petty demands are met, the governor has proven once again that he is more than willing to put Maine people, Maine businesses and Maine’s economy at risk. For the sake of our fiscal health, our strong credit and bond ratings and most importantly, our people, I urge the governor to take immediate steps to undo the considerable damage he has caused.”
Bonds involved in the hold-up include $8 million for port, harbor and marine transport upgrades, $25 million for commercialization and research and development and $80 million for in-progress highway and bridge projects,” Gideon’s office reported.
In a news release issued today, Gideon's office stated that the delayed $117 million in bond funding included $97 million earmarked for infrastructure projects, adding that the "unnecessary uncertainty puts Maine’s strong credit rating at risk, will raise future borrowing costs, and upsets ongoing infrastructure work across the state."
Hayes told the BDN that besides putting at risk projects that were expecting funding from the sale of those bonds, the missed deadline puts a big question mark over the $54.5 million that the state borrowed from itself with the expectation that it would be repaid after the bond sale.
Matthew Marks, CEO of the General Contractors of Maine, told the BDN the anticipated bond sale was expected to fund more than 350 current projects across Maine employing more than 2,000 people.
“I don’t even know what the argument is about this,” Marks said. “There’s nothing construction-related that’s holding this up, as far as I know.”
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