RMA Speaker Sees Positive Signs
Jack Cashman, Maine’s commissioner of the Department of Economic and Community Development, addressed the annual meeting of RMA on May 19 with a positive message about Maine’s business climate and economic outlook.
“There’s more good to talk about in the Maine economy than bad,” he said, referring the audience to the economic development plan on the DECD Web site.
For the last three to four years, Maine’s unemployment rate has been a percentage point below the national average. But there is work to be done. The number one item on the economic development plan: create a fair and stable business environment. “Our tax burden is too high,” he said. “The cost of doing business must be controlled and the regulatory process must become more friendly.”
Among his goals are the lowering of the corporate income tax and removal of the personal property tax on business equipment. The governor has put the latter measure before the Legislature twice and gotten shot down, he said, but the administration plans to keep trying.
State of the State
Maine must first invest in its people, he says. Our work ethic is renowned. Corporations that have located in Maine constantly reaffirm that they get a day’s work for a day’s pay. The state must continue to educate and train this resource in order to tap into this key to growth that is already here. The objective is to have 60 percent of high school seniors go on to college by 2006, and 70 percent by 2010.
Maine has led the world in forest and marine industries and can do so again. Maine has fallen behind the curve, especially in the area of natural resources, where we have always been a leader. Paper companies have fallen behind because they are not able to attract the investment they need to upgrade and modernize.
Hard Work The state just doesn’t seem like the kind of place that these investors want to invest in. Without investments these industries wither and die. In the last two years, Wisconsin lost 9000 paper company jobs. We have been successful in reopening three paper mills. If the state can bring back Lincoln Pulp and Paper Co. it can put those 350 people back to work. “If not, we have zero chance of bringing another employer who will hire 350 people in Lincoln.”
New Zealand promotes its boat building industry very effectively, and Maine should take heed of this and come up with an organized collective promotion. “We have the best boatyards in the world here,” he says. It’s time to convince the rest of the world.
Another industry we need to renew and encourage is precision manufacturing. Pratt & Whitney is renowned for its highly skilled and trained workforce. Support for research and development of cutting-edge technology will help develop the manufacturing jobs of the future.
Emerging industries such as biomedical research should also be fostered. Jackson Laboratories formed a biomedical coalition a few years ago with four other partners. The result was a critical mass that attracted top researchers and foundation money to the biomedical research industry right here in Maine.
Maine is also a logical choice for aquaculture. New Brunswick has very large aquaculture firms that are outgrowing their spaces. They could easily move some of their operation growing haddock, cod and salmon just across the border into Maine.
Maine’s favorable bank franchise tax, telecommunications network, strong labor pool and reasonable office rental space make it attractive to financial services. An unparalleled quality of life adds to the opportunity for growth.
Tourism accounts for 14 percent of our state’s economy, while the national average is 6 percent. We need to begin to tap into new markets — Europe, for example. The World Cup Biathlon race was watched by 26 million Germans on television — a good opportunity to capitalize on making a good impression.
Taxes play a large role in the state’s economic picture, and “until we address the delivery system of services at the local level, we will never get out of the infamous top 10 most heavily taxed states in the U.S.,” he says. In his estimation, with 68 cents of every tax dollar spent at the local level, we need to look at a number of ways to streamline the delivery of services, perhaps through regionalization.
There is work to be done, but Maine is blessed with a vital workforce and many natural resources. By working together to find new markets for products and to invest in new technologies for established industries, the future can be bright.