State Budget Practice Report Cards and Budget Resource Guide
Maine was one of fifteen states that didn’t earn a single A in any of the five budgetary categories evaluated by the Volcker Alliance for fiscal 2015 through 2017. The state’s lowest average mark of C was in legacy costs, which include public worker pensions and other postemployment benefits (OPEB), principally retiree health care.
The state was marked down in that category for its failure to make actuarially recommended contributions for OPEB, though it provided full actuarial funding for pensions. In 2016, for example, Maine contributed about 85 percent of actuarially required OPEB contributions for general employees, 68 percent for teachers, and 40 percent for first responders.
Maine got a three-year average of B in budget maneuvers by largely avoiding one-time actions to achieve balance in 2016 and 2017. The B grade in each of those years marked an improvement from the C in 2015, when the state deferred expenditures related to MaineCare, its Medicaid program, to yield one-time savings.
In budget forecasting, Maine’s notable shortcoming was the absence of multiyear expenditure forecasts. Although the state has a requirement to compile four-year revenue and expenditure forecasts for the general and highway funds, the governor’s budget document discloses only two years of expenditure forecasts.
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2015 through 2017. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eleven US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.