Schaefer plans cuts of $243M in budget

December 28, 1990|By William Thompson | William Thompson,Evening Sun Staff

Gov. William Donald Schaefer plans to slash another $243 million from the state budget by cutting nearly every state agency's budget, including deep cuts for higher education and such capital projects as a designer golf course in Western Maryland and beach replenishment in Ocean City.

The latest round of cuts, aimed at reducing a budget deficit now projected at $423 million, were announced today by Charles L. Benton Jr., the governor's chief budget expert. Benton met with Schaefer last night to go over the cuts, produced in a marathon budget review process that has had state fiscal experts meeting daily throughout the holiday season.

Nearly $90 million of the spending constraints are expected to be approved next Wednesday during the weekly meeting of the state Board of Public Works, state officials said. The other $153 million will require legislative action.

Budget cutters said today's proposals will bring state spending down sharply without eliminating many state jobs. Several weeks ago, Schaefer had proposed laying off some 1,800 state workers, but he reversed himself under political pressure and said he would try to reduce the deficit without layoffs, for now.

Since the cuts proposed today will affect many programs, "maybe two dozen" people will be out of work, said one fiscal adviser.

Some of the deepest cuts will hit the University of Maryland System, which will lose $14.3 million in state aid. On the hit list of capital projects is a public safety training center proposed for Carroll County, which will lose $6 million of its $12 million state funding.

The Rocky Gap Golf Course, one of Schaefer's favorite capital projects, is in line to lose $3.5 million, leaving intact another $6 million budgeted for the Western Maryland recreation center.

Another $3.4 million which was set aside to restore Ocean City beaches in case of dramatic storm damage also is on the chopping block.

Schaefer is also proposing that $72 million of the state $126 million "rainy day" fund be used to cover the budget deficit. Legislative leaders have offered to approve up to a $60 million transfer from the emergency fund, but the governor needs more, budget aides said.

A large chunk of the budget deficit will be covered with $40 million in unspent appropriations for two popular state programs -- Project Open Space, a parkland acquisition program, and Agricultural Land Preservation. Schaefer aides said they will restore the money during a later budget year.

If Schaefer's cost-saving measures are approved, state employees will see their paychecks drop by $5 each pay period. Schaefer is proposing that $5 of the amount the state pays for employee health insurance be paid by each worker.

The projected deficit is now more than twice the amount Schaefer had been using as a guideline when he first began trimming the state's $11.7 billion budget early last month. Under law, the state must end the fiscal year with a balanced budget.

State budget experts blame the deficit on an unexpected drop in revenues and an unanticipated leap in the costs of administering such programs as welfare and Medicaid.

In November, Schaefer reduced state spending by $176 million.

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