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Maine Governor Now Says He Wants to Sell $391 Million of Bonds

Maine Gov. Paul LePage announced his support Tuesday for the sale of $391 million in bonds, but the state treasurer voiced skepticism.

Until today LePage had been opposed to immediately selling $105 million in voter-approved bonds. Democratic Maine Treasurer Neria Douglass has been trying to get LePage to do this.

On Tuesday, LePage, a Republican, said he was in favor of selling these bonds as well as an additional $186 million in bonds to cover money the state government has owed to hospitals for Medicaid services since 2009. The state transfer of this money would lead to $298 million in federal money owed to the hospitals for Medicaid services, according to LePage.

“With the full support of the Legislature, I intend to pay the hospitals and issue general bonds in a matter of months,” LePage said in a statement.

The $186 million would be repaid using revenues from liquor sales. The state plans to take over these sales in 2014.

However, Douglass told The Bond Buyer that the $186 million bond is “somewhat in question.”

There is a constitutional prohibition against using bonds to pay for “current expenditures.” As a past-due debt the Medicaid payments may be fall into that category, she said.

Finally, LePage proposed the sale of a $100 million government facilities bond to build a new prison to replace the existing facility.

If this bond goes forward, the Maine Government Facilities Authority would vote on it. Douglass is on this board and said she was unsure if she would support the bond.

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