Last month, the Mills Administration announced the first round of spending under the Governor’s Maine Jobs & Recovery Plan, an initiative calling for a nearly $1 billion investment of federal American Rescue Plan funds in Maine. The three initiatives, $80 million for the Maine Unemployment Trust Fund, $39 million to help lower health insurance premiums, and $20 million to establish a new small business grant program, along with the remaining portion of the Maine Jobs & Recovery Plan, are intended to help Mainers recover from the ongoing pandemic, invest in long-term economic growth in Maine, and rehabilitate local infrastructure.
Below are overviews of each of those three initiatives. More information on the Maine Jobs & Recovery Plan can be found HERE.
1. Replenishment of Maine’s Unemployment Trust Fund.
The Mills Administration transferred $80 million into Maine’s Unemployment Trust Fund (“UTF”), the third such transfer, for a total of almost $300 million. Those transfers have helped the UTF remain solvent through the pandemic, avoiding the need to borrow money from the federal government. The UTF is primarily funded through employer unemployment taxes, and the Maine Department of Labor (“MDOL”) estimates that without those transfers, employer taxes in 2021 and 2022 may have more than doubled.
Around 45,000 employers pay into the UTF, and the MDOL has paid out more than $2.4 billion in unemployment benefits since March 15, 2020, $606 million of which came from state funds. However, during the week ending October 9, 2021, weekly unemployment claims were at their lowest since December 2019.
2. Small Business Health Insurance Premium Relief Program.
The Maine Bureau of Insurance will use the $39 million from the Mills Administration to establish the Small Business Health Insurance Premium Relief Program. Between November 1, 2021 and April 30, 2023, the program will provide financial assistance to insurers directly to reduce premiums for their small business customers, lowering premiums by $50 per employee per month. Premiums will be lowered by $80 for families of one adult and one child, $100 for two adults, and $130 for two adults and one child.
The businesses will split the savings with their workers based on the share of the total premium each pays, but business can also voluntarily choose to pass on a greater portion of the savings to their employees.
3. The Maine Jobs & Recovery Small Business Grant Program.
The Maine Department of Economic and Community Development (“DECD”) is allocating $5 million of its total $20 million grant allocation to support capital-intensive businesses and non-profits that need short-term assistance. The grants will be applied to help offset loan- and interest-related expenses incurred in sustaining operations. To qualify, the loans must be in deferral as a direct result of the pandemic and the business must demonstrate that it lost at least 20% of its revenue during 2021.
The DECD’s remaining $15 million will be made available in April 2022 so that affected business can use their tax returns to demonstrate the required revenue decrease and qualify for the grants.
Applications for the initial phase of the DECD’s grant program opened on November 1, 2021.