ANNAPOLIS -- State employees will be forced to give up incremental pay raises and to shell out more for their health insurance as part of Gov. William Donald Schaefer's plan to balance next year's budget.
Mr. Schaefer also intends to ask the 1991 General Assembly, which convenes its 90-day session at noon today, to transfer $76 million from the Transportation Trust Fund to the general treasury, a move that would make a gas tax increase difficult to avoid.
The budget-balancing plans were made public yesterday by the governor's budget secretary, Charles L. Benton Jr., who as a courtesy briefed Republican lawmakers on how the Schaefer administration intends to close a fiscal 1992 deficit now projected at $224 million.
The moves are in addition to those already undertaken to meet a $423 million deficit in the current budget.
Mr. Benton also said budget plans include saving $17.5 million by eliminating or freezing 3,100 already vacant state jobs; forcing people on parole or probation to pay for their own supervision; and budgeting $19.5 million in increased lottery revenues expected when new lottery computers offering more exotic games come on line.
After Mr. Benton's briefing, Senate Minority Leader John A. Cade, R-Anne Arundel, said he was concerned that the administration's deficit estimate might be too conservative. Given the current revenue projections, however, he said he would rather see reductions than layoffs.
"Either you do things like this or you go into massive layoffs. I happen to think it's better to do this than cutting warm bodies, which only exacerbates the situation, especially in a time of recession," Senator Cade said. "It's better to take the medicine than it is to die."
Joel Dan Lehman, president of the Maryland Classified Employees Association, the largest union of state employees, said his organization did not like the latest round of "givebacks," but agreed they were preferable to layoffs.
In another cost-cutting move, Governor Schaefer established yesterday a uniform, 40-hour workweek for all state employees, effective Feb. 6. Two-thirds of the state work force, or about 40,000 employees, currently work a 35 1/2 -hour week.
"An increase in the number of hours worked will help the state to significantly reduce overtime costs and improve the quality of service to the people of Maryland," Mr. Schaefer said. He said the 40-hour workweek should increase productivity while saving an estimated $183 million.
MCEA's Mr. Lehman said that by accepting the governor's executive order, union members were "biting the bitter half of the bullet," but again, that it was better than losing their jobs.
By denying workers automatic, "increment" pay increases in the budget year that begins July 1, the state expects to save $25 million, Mr. Benton said. Reducing the state's share for employee health insurance from 82 percent to 79 percent should save another $10 million.
But the proposed shift in funds from the already depleted Transportation Trust Fund seemed to bother legislators most.
"The Transportation Trust Fund is broke," said House Minority Leader Ellen R. Sauerbrey, R-Baltimore County. "This is a shell game, to be taking money out of the Transportation Trust Fund to balance the general fund and then try to get people to accept a gas tax."
But Sen. Laurence Levitan, D-Montgomery, chairman of the Budget and Taxation Committee, said that while he supports a fuel tax increase to keep the state's transportation program moving, he was troubled by the proposal to transfer money out of the Trust Fund.
The Schaefer administration also proposed restoring $15 million to the state's "Rainy Day Fund," a fund designed to meet financial emergencies. The governor and the legislature recently agreed to shift $72 million out of the $126 million fund to help eliminate the current budget year's $423 million deficit.