Glendening proposes hefty budget

$17.7 billion exceeds Assembly's ceiling

cigarette tax included

January 15, 1999|By Thomas W. Waldron and Michael Dresser | Thomas W. Waldron and Michael Dresser,SUN S TAFF

Blessed with surging state revenues, Gov. Parris N. Glendening is proposing a $17.7 billion budget for next year that would reward friends, punish at least one enemy and is far too fat to meet the legislature's self-imposed spending limits.

In the first budget he has submitted since his re-election in November, the governor said he was honoring his campaign pledges to increase funding for education from kindergarten through 12th grade, state colleges and public safety.

Glendening did not follow through on a campaign proposal to accelerate the 10 percent, five-year income tax cut passed in 1997, even though the state has a surplus of more than $250 million.

Some legislative leaders advised the governor yesterday to hold off for a year on efforts to increase the state's tax on gasoline, the revenue from which is mostly dedicated to highway and mass transit projects.

Even former advocates of the tax increase, which many business leaders consider necessary to shore up the state's transportation fund, were backing away from proposals to raise Maryland's 23 1/2-cent-a-gallon gasoline tax by as much as 5 cents.

"I came in here a month ago thinking we could address this transportation tax problem this year," said House Speaker Casper R. Taylor Jr., an Allegany County Democrat. "I'm becoming more and more convinced by the hour that we can't."

Ray Feldmann, a spokesman for the governor, said Glendening is weighing whether to push for the gasoline tax increase this year or next.

Instead, the governor focused on his budget proposal, which will be formally submitted to the legislature next week.

The state's general fund, the portion of the budget over which the governor has the most authority, would grow by nearly 6 percent, to more than $9 billion, under the spending plan Glendening outlined yesterday.

The governor's budget exceeds the legislature's limits on the growth in state spending by more than $150 million.

Governors have ignored the legislature's "spending affordability" limits, but no governor's budget has come in as far above the recommended ceiling for many years, legislative budget analysts said.

Key legislators said yesterday that they were prepared to trim the budget to meet the guidelines.

`Room to cut'

"That's automatic," said Senate President Thomas V. Mike Miller, a Prince George's County Democrat. "There's certainly room to cut, and a good portion of it is going to have to come from what the public considers a priority, and that is education."

The spending plan comes with what Glendening's budget secretary called a "catch": It includes $155 million that would be generated by the governor's proposed $1-a-pack increase in the state's tax on cigarettes.

If the legislature refuses to go along with the first 50-cent boost in the cigarette tax, which would come this year, it must trim the budget by $155 million, which lawmakers don't relish.

Under the Maryland Constitution, the Assembly can cut the governor's proposed budget but not add to it.

Seeking to add more pressure in support of his cigarette proposal, Glendening has identified seven major higher education construction projects that would be funded from the proceeds of the second 50 cents of the tax increase, which would go into effect next year.

If that portion of the tax is defeated, those campuses would likely have to wait several more years for the projects to be built.

`Cleverly done'

"It's an extremely cleverly done budget," said Sen. Barbara A. Hoffman, head of the Senate budget committee. "It does create a constituency for a cigarette tax."

Glendening defended the proposal, saying he believed the state's voters endorsed it in last fall's election.

"I ran on the tobacco tax to protect our children and won big," Glendening said.

The governor has focused the increases in his budget on education spending and compensation for state workers.

The state's universities and colleges would receive $102 million more in state support, an 11 percent increase.

Of that, $63 million would go to the University System of Maryland, a 10 percent increase.

"I think that's spectacular," Donald N. Langenberg, the system's chancellor, said of the proposed increase.

"The governor is continuing what was established last year with his four-year plan to fund the University System so it can reach the level of quality that was envisioned in 1988," Langenberg said.

The aid to the UM system could grow during the session if more state revenue is available, said Budget Secretary Frederick W. Puddester.

Glendening followed through on a campaign pledge by allocating $250 million to build and repair public schools. The governor plans to continue that high level of funding for four years, which would significantly reduce the state's backlog of school construction projects.

"We have a great opportunity to move the state forward, to make some critical investments in our future, while remaining fiscally prudent," Glendening said in a statement.

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