'The Cupboard is Bare'

February 02, 1991

Charles L. Benton, who is Gov. William Donald Schaefer's long-time fiscal wizard, had to pull just about every rabbit out of his magical hat to balance this year's financial blueprint. Plunging revenues, rising costs for mandated programs and a "no new taxes" mood forced him to jerry-rig a budget that is precariously balanced with bubble gum and bailing wire. The $11.6 billion state budget unveiled yesterday calls for overall growth of a mere 1 percent -- the smallest increase in 46 years.

Only by turning to fiscal legerdemain was Mr. Benton able to pull off this feat. Yet in drawing every last surplus penny out of various nooks of state government, the budget director badly depleted Maryland's reserve fund and left the Transportation Department in shambles. Legislators will be hard pressed to avoid raising the gasoline tax if they want roads repaired in the next 18 months.

Mr. Benton claims he exhausted all of the potential one-time savings and traditional cost-reduction methods short of wholesale firings of state workers. "The cupboard is bare," he said, noting that a prolonged recession could mean far greater troubles ahead. Compounding the state's dilemma has been the steep rise in prison, welfare, health and school costs ($328 million) that must be paid. How Maryland will meet 1992's bills already is beginning to alarm state officials.

As expected, there will be no pay raise for state workers. Nearly 1,600 vacant job slots are being wiped off the books. Most agencies must make do with a microscopic increase that doesn't come close to keeping pace with inflationary expenses.

Yet the governor found room for a few initiatives: $19 million diverted from extra education aid to fund an ambitious program to reward good schools and help poor schools; $3.8 million to implement a statewide land-use plan; $2 million to establish a bio-processing center; $1.8 million to continue work on the Christopher Columbus marine research center, and $2 million to start expanding the Baltimore Convention Center. These are exciting programs that deserve General Assembly support.

Governor Schaefer has had to cut nearly $600 million in expenses to balance this budget. Yet Mr. Benton conceded the weakening regional economy may still require more emergency reductions during the next two months.

For legislators, all this constitutes unwelcome news. A gas tax increase appears inevitable. The 1991 budget is so tight that House Speaker R. Clayton Mitchell's notion of finding $200 million in savings in lieu of raising taxes may not be possible without inflicting considerable pain. Mr. Mitchell and other Assembly leaders would be wise to explore all options -- especially the tax reform measures contained in the Linowes commission report -- before decapitating worthwhile social service programs that Mr. Schaefer's budget preserves.

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