The budget sky really is falling in Annapolis

February 23, 2003|By C. Fraser Smith

BLAME THE $1.8 billion deficit or the rush to slot machine gambling or the snow, but Annapolis isn't focused on its fundamental financial problem: Too many commitments, too little money - and not enough thinking about how to put things right.

Already, the imbalance and the emergency measures to deal with it impose harsh decisions on social service agencies, state universities and local officials who are asked to absorb the pain of budget-cutting.

In the absence of a game plan that goes beyond more gambling, budget-cutting becomes policy-making. For example: Deep reductions in child care benefits erode the commitment to welfare families struggling for a foothold in the marketplace. Gov. Robert L. Ehrlich Jr.'s administration suggests child care is not a "core government service," which amounts to a sharp reversal of earlier state policy. Over 20 years, give or take, child care has been regarded as central, particularly as government moves welfare families into the world of work.

The implications of budget-cutting as policy-making are obvious at many other levels.

The new administration says Maryland's counties are getting as much state aid as they did last year. It's true - and it's false. Every county will get more money from the Thornton Commission education formula. But the counties are asked to absorb real cuts in other areas.

The Ehrlich budget reduces highway maintenance aid to the counties by more than $100 million statewide. In Garrett County, it's a setback of $1.58 million - almost exactly the sum budgeted there for snow removal, which was $1.66 million. The county can't use Thornton money for snow plowing.

Local officials throughout the state are incensed. Many of them did the responsible thing and raised taxes locally to meet needs even as state government was cutting taxes. Annapolis exacerbated the problem with its $1.3 billion commitment to the public schools under Thornton. Legislators knew the money was not there, but, hey, it was an election year.

Howard County needs money to build schools. New residents with school-age children must be served, but Howard's delegation in Annapolis won't approve County Executive Jim Robey's request to raise the property transfer tax.

That targeted levy, paid by newcomers, seems reasonable since newcomers' children need the new schools. But, not wishing to vote for any tax increases, the county's representatives urged the executive to raise the local income tax. Would a more comprehensive look at state and county finances reduce the buck-passing?

Maryland's higher education system tried to impose a midyear tuition increase to cushion the shock. Students have taken the system to court. Their protest illustrates the financial consequences that flow from a helter-skelter revenue policy. University administrators worry that even more retrenchment will be needed. Are we cutting to fill budget holes, or because we have a lesser commitment to the university system? Or because we think students aren't paying enough?

The Ehrlich administration quite properly wants to address the immediate budget problems before turning to the longer term. It wants to complete its own study of state government - and do its budgeting based on the results. Fair enough.

But no one should imagine that policy decisions aren't being made, study or no study.

"The fiscal house is falling in," says House Appropriations Committee Chairman Howard P. Rawlings of Baltimore. He says the Democratic political impulse is to force Mr. Ehrlich to provide the roof supports: more cuts or tax increases.

The Ehrlich administration has made it clear that new or increased taxes are not on the agenda. Maybe next year.

Mr. Rawlings would consider a half-cent increase in the sales tax and a temporary surtax on the highest-income Marylanders. The important word, though, is consider. Some 24 other states are actively considering some sort of tax, and others seem likely to join the unhappy parade.

In Annapolis we have the Fiscal Follies, complete with head-in-sand ostriches, games of chicken and wheels of fortune (a.k.a. slots).

C. Fraser Smith is an editorial writer for The Sun. His column appears Sundays.

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