Declaring the end of the "era of credit card government," Gov. Robert L. Ehrlich Jr. unveiled $208 million in budget cuts yesterday that he says are needed to help the state address a looming $1 billion shortfall.
The cuts, approved yesterday by the state Board of Public Works, include the elimination of 963 state employee positions. Only 83 are currently filled.
The Department of Health and Mental Hygiene is absorbing the biggest share of the spending reductions. The agency's $3 billion budget was cut by $84.4 million.
Ehrlich also slashed $40 million from the University System of Maryland's $786 million budget, $9.1 million from aid to local governments and $9.7 million that had been designated for community colleges.
Advocacy groups warned that cuts in funding for drug treatment, job training, after-school activities for poor children and similar social service programs will cause significant harm.
"We've seen the list of cuts, and about $28 million specifically affects programs for children and families," said David R. McNear, a budget analysts for Advocates for Children and Youth.
He said the cuts are on top of previous reductions during this year's legislative session. "We're cutting past the bone at this point," McNear said.
Ehrlich said cutting spending now is a prudent move that will prevent the need for even more drastic cutbacks when the state prepares its budget for the next fiscal year.
He said voters elected him last fall to put the state's fiscal house in order.
"The era of credit card government is over," he said. "It officially ended on Nov. 5."
Comptroller William Donald Schaefer, who serves on the Public Works Board with Ehrlich and State Treasurer Nancy K. Kopp, told the governor that he was doing the right thing even though Schaefer said he didn't like having to vote for some of the cuts.
Schaefer blamed the state's fiscal woes on what he characterized as reckless overspending by former Gov. Parris N. Glendening and the General Assembly.
"You are such a nice man, such a decent man," he told Ehrlich. "I think you were dealt a dirty hand, and I don't like it."
But Kopp, a former Democratic state delegate, told Ehrlich that he needed to work on the budget problems in collaboration with lawmakers.
"We went through a fiscal crisis 10 years ago, and we got out of it well because of collaboration, true collaboration, and I think that is what is called for now," she said. "The legislature was also elected as a policy-making body."
Ehrlich said the state would not be facing a fiscal crisis if lawmakers had passed his plan to allow slot machine gambling at racetracks.
"The slots bill was killed for no good reason - none," Ehrlich said, his voice rising.
He said his slots proposal would have fully funded educational system reforms called for by the Thornton Commission.
"We hope that the politics can be put aside and that we can get a slots package together and fund [Thornton] appropriately," Ehrlich said.
The $208 million in spending cuts represents a little more than 2 percent of the state's $9.8 billion general fund budget.
For the most part, the cuts are being accomplished without reducing programs that serve the public, said Budget Secretary James C. "Chip" DiPaula Jr.
About $57 million, or 27 percent, comes from administrative savings and efficiencies, DiPaula said. And $41 million, or 19 percent, is from "fund swaps" - replacing general fund money with federal funds.
About $45 million of the savings comes from reductions in services - 22 percent of the total, DiPaula said.
The spending cuts are a fraction of the $650 million that Ehrlich had been considering.
Ehrlich had directed Schaefer to withhold that amount from the money that the General Assembly had appropriated for various agencies this fiscal year - a move that was sharply criticized by Democratic lawmakers.
DiPaula said that money will be released for the agencies to spend, less the $208 million in cuts.
House Speaker Michael E. Busch, an Anne Arundel Democrat, said he is concerned that there has been no public vetting of the plans the governor is implementing.
"I understand the governor is trying to get a jump on next year," he said. "They've been informative to the legislature. But it's not been a collaborative effort. There's no public notification. There are no public hearings. My major concern is not the cuts but that this might set a precedent when we're not in a crisis."
The cuts themselves drew fire yesterday from others.
Mayor Martin O'Malley said that $600,000 slashed from drug treatment programs in Baltimore was particularly painful, given the city's battle to expand help for addicts and to get violent people off the street.
O'Malley said he also is concerned about the impact of $4.2 million in cuts to the Department of Juvenile Services.
