Schaefer builds big budget on the back of keno Lawmakers blink at 4.5% increase

January 21, 1993|By John W. Frece | John W. Frece,Staff Writer Staff writers Marina Sarris, Tom Bowman, Laura Lippman and Timothy B. Wheeler contributed to this article.

Relying heavily on gambling proceeds, money intended for parkland purchases, and higher fees and fines, Gov. William Donald Schaefer yesterday introduced a $12.7 billion budget for next year that calls for a 4.5 percent increase in spending that many lawmakers may view as extravagant.

While only a few details of the spending proposal were available yesterday, it appeared that Mr. Schaefer intends to direct most of the new money to local governments for education, health services and police protection, and to restore a number of the social programs squeezed by repeated budget cuts the past three years.

Such a budget is sure to set off a fight between the administration and legislators who want state government permanently "downsized," and who may think such spending levels are too high and risky given the expected slow recovery of the state's economy.

"Damn, that's kind of steep," said House Appropriations Committee Chairman Howard P. Rawlings, a Baltimore Democrat, when told that proposed spending would grow by 4.5 percent, or $558 million, over this year's thrice-reduced budget. State tax revenue from growth in the economy is not expected to increase more than 2.3 percent in fiscal 1994, which begins July 1.

House Speaker R. Clayton Mitchell Jr., D-Kent, said if he had prepared the budget, it would have called for a zero increase in spending.

He and Mr. Rawlings noted that they and other legislators will not be briefed in detail on the budget until this morning, but said if proposed spending is really that high, the legislature will have no choice but to do more budget cutting than had been expected.

The governor intends to supplement growth in revenue from a modestly recovering economy with an estimated $100 million from the controversial new keno lottery game, which the administration opened for business earlier this month.

He also will ask the General Assembly to postpone for two years full restoration of a program to acquire land for use as parks, a delay that would yield $19 million for other programs. In addition, Mr. Schaefer's budget calls for a variety of higher or more aggressively collected fees and fines.

The budget bill was hurriedly dropped into the legislative hopper yesterday to meet a constitutional deadline for its introduction. But detailed written materials describing the proposal were not to be available until today, and many details remained sketchy.

For example, it was unclear whether the governor intends to increase welfare benefits that have been reduced as part of cost-saving efforts in the past three years.

But administration officials said that for the third consecutive year, state employees would go without a cost-of-living raise, although about 40 percent of the state's 70,000 workers would receive so-called "step increases."

The raises for those workers, most of them on the lower salary rungs, would cost $22 million.

It also was clear that Mr. Schaefer intends to spend a substantial part of the increase on programs that benefit local governments.

He intends to fully fund a previously scheduled $120 million increase in state aid for education; to increase to $9 million from $6 million a program for 4-year-olds; and to spend about $2 million more to prevent teens from dropping out of school.

About $600,000 would be spent on a pilot "school choice" program for about 200 low-income students.

Mr. Schaefer also wants to restore a $36 million annual "disparity grant" intended to help Baltimore and the state's five poorest counties, and to restore another program cut during this year's budget crisis, a $53 million police aid grant shared by the state's 23 counties.

Because local health services were decimated by reductions this year that cut state aid from $34 million to $14 million, the budget contains $30 million for spending "targeted" at maternity and child care, family planning, cancer control and AIDS education and research.

The governor also wants to restore part of the state-funded medical assistance program for the poor and the disabled. The program would receive $13.6 million -- less than half of the money it used to have -- to pay for preventive medical care for indigents. This year, the program was simply eliminated for lack of money.

The health department would receive a $1 million increase for the governor's family planning initiative. The money would be sufficient to allow 2,350 Maryland women to obtain the contraceptive Norplant and to permit the state to pay for as many as 30 vasectomies for men.

State money to help retarded Marylanders would also be increased by about $10 million, to $158.8 million.

New spending would include a $2.75 million, or 10 percent, increase in the money available for college or university scholarships, enough to provide assistance to about 2,000 additional students.

Mr. Schaefer is even proposing a $2.75 million tax break for research and development firms.

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