Wednesday, May 30, 2007

Grads are raw material for the new economy

Lewiston Sun Journal editorial

Traps are useless without lobsters. Paper mills are useless without trees. Innovative economies are useless without youthful, energetic workers to propel them.

Unlike Maine's natural resource-based industries, the ballyhooed "creative economy" depends on cultivated raw material: educated workers. College graduates don't occur naturally, like pines or crustaceans, but are reaped through educational availability, investments and incentives.

Lack of educated workers is cited, over and over, as Maine's economic tripwire. The Legislature, to its credit, showed vision last week when the Taxation Committee enthusiastically supported creating tax credits of up to $2,100 for graduates of Maine colleges who elect to stay, and work, in the state.

It's a sensible, forward-thinking policy that simply cannot hurt to try.

The legislation arose from a ballot initiative called Opportunity Maine, which collected more than 70,000 signatures for the proposal to appear on the November ballot. If the legislative effort fails, this is where this laudable idea will appear later this year.

Tax credits, essentially, fund potential growth, with the hope that today's government support will lead to tomorrow's fiscal reward. College graduates are a smart bull's-eye at which to aim such public investment.

There is no guarantee this credit, however, will change Maine's economic landscape, or kick-start the creative economy so touted by politicians and business interests. The tax credit, however, shouldn't be viewed as a guarantee of finite results. It's investment in raw material, pulp for the new economy.

Most important, this tax credit invests in an overlooked resource: people. This isn't about quality places or other trendy entities that are hopeful magnets for future dollars. As much potential likely exists in tempting college graduates to stay in Maine as feeding funds into emaciated downtowns.

Excitement over the tax credit was revealed through the committee's support, and comments from representatives such as Rep. L. Gary Knight, R-Livermore, who spoke of broadening the idea to include graduates interested in repatriation to Maine.

The credit needs time to work first. Broadening it, either for expatriates or perhaps retroactive application, would carry costs. As constituted, the credit lures graduates to stay where they might not, a simple proposal for a complicated problem, and one that should remain this way, for now.

We urge the Legislature to enact the tax credit as a signal to graduates they are welcome, and urged, to stay. Maine's new economy needs them to thrive.

First, though, Maine needs them to stay here.

Read Full Story

Friday, May 25, 2007

Panel backs bill to keep grads in state - Portland Press Herald

State House: The measure would give tax breaks on college loans to those who work in Maine.

by Ann Kim


AUGUSTA — A legislative committee gave a boost on Thursday to an effort to provide tax relief to Maine college students who work in the state after graduation.

The initiative, which would give graduates of Maine colleges an income tax credit for some or all of their student loan payments, already has enough petition signatures to be put to voters statewide.

But supporters of the plan went to the State House to urge lawmakers to enact the measure directly, and the Taxation Committee listened.

The 11 members present voted that the bill should be sent to the full Legislature for consideration.

Rob Brown, executive director of Opportunity Maine, the group that began the petition drive last year, called the committee vote a crucial step in a long process.

"I think it shows the power of people, and people speaking up," Brown said.

The petition organizers submitted more than 73,000 signatures to qualify for the ballot. On Thursday, more than 40 people packed the Taxation Committee's hearing room and all but a handful stood up when asked who was there to support the bill.

Under the proposal, anyone who earns an associate's degree or bachelor's degree from a college in Maine would be eligible for the tax credit in years the person lives and works in the state.

The credit would be limited to the amount actually paid toward loans, up to a maximum that would be calculated based on the costs of tuition and mandatory fees in the University of Maine System.

The limit based on current costs would be about $2,100 a year.

Any employer who makes the loan payments on behalf of a graduate could claim the credit.

Supporters of the proposal say it will encourage more people to pursue higher education, create a more skilled work force and help the state's economy.

All kinds of students -- young, old, traditional and those seeking to train for new jobs -- are burdened with heavy debt, said Andrew Bossie, president of Opportunity Maine and a recent graduate of the University of Southern Maine. He said many face the same difficult question.

"Will I be able to stay in Maine where I prefer to live and seek a decent living or do I go somewhere else where the wages are higher?" he said.

Anya Kamenetz, the author of "Generation Debt," told the committee that it is no longer possible for a student's full-time minimum-wage summer job to cover the next school year's expenses, as it was as recently as the 1980s.

The average student debt in Maine is $20,237 -- the seventh highest in the country, she said.

Rep. Herb Adams, D-Portland, urged the committee to support the initiative, which he called the GI bill for Generation Next.

Adams sponsored a fallback version of the bill that could have gone through the usual legislative process if the petition drive had not gathered enough signatures.

The enthusiasm of some committee members was clear, although there were some concerns raised about issues including the difficulty of recapturing wrongly claimed tax credit money.

Rep. L. Gary Knight, R-Livermore Falls, called the proposal a "terrific initiative" but said he would like to see a broader program that includes Mainers who attend school out of state and want to return.

Independent Rep. Richard Woodbury of Yarmouth predicted that the measure would succeed at the polls if it did not make it through the Legislature.

"It'll pass because it's a really great idea," he said.

Read Full Story