$125 million budget cut deal set to replenish dwindling revenue Schaefer and lawmakers avoid layoffs

May 22, 1991|By William Thompson | William Thompson,Evening Sun Staff

Maryland lawmakers have agreed to plug the state's projected revenue deficit by cutting up to $125 million from various agency budgets and emergency funds.

Gov. William Donald Schaefer joined House and Senate leaders and other state officials yesterday in calling the proposed cuts "regrettable" but necessary to balance the budget before the current fiscal year ends June 30.

The agreement taps into a wide spectrum of state programs, but does not include layoffs or furloughs of state employees.

The cuts include about $79 million that will require approval by the full General Assembly at a special session June 26.

If all $125 million is removed from the budget, state officials will have taken from the spending plan more than $660 million to balance this year's recession-battered $11.5 billion budget.

The comptroller's most recent prediction is that the revenue shortage will be $109 million. The lawmakers, however, earmarked $16 million in additional cuts in case the shortage is worse.

"The cupboards are bare. There's not a crumb left on any cupboard shelf," said state Treasurer Lucille Maurer.

The plan proposed yesterday will get the state through the last six weeks of this year's budget. Unless there is a quick turnaround in the economy, money problems will resurface when the new fiscal year begins July 1. Already fiscal advisers predict that the 1992 fiscal year's $11.6 billion budget will come up short $150 million in revenues.

Lawmakers congratulated themselves for resolving the latest budget crisis within a week of the comptroller's grim revenue estimates. Schaefer, who said he disagreed with a newspaper account that suggested he and the legislature were at odds over the budget-cutting process, said yesterday's announcement was "a sign of cooperation."

The biggest budget cuts include:

* $16 million from the state's Program Open Space, a fund popular with county governments which is used to purchase and save land from development.

* $27 million in the state's so-called "rainy day" emergency set-aside fund.

* $1 million from its "sunny day" fund for economic development.

* $5.5 million in capital projects.

* $6.5 million in housing program funds.

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