Nonprofits, local projects could lose state funding

January 31, 2009|By Laura Smitherman | Laura Smitherman,

Legislative leaders may revoke as much as $44 million in bond money earmarked for nonprofits and local capital projects as they work to craft a more austere budget than envisioned by Gov. Martin O'Malley.

The at-risk bond funding has been authorized for projects around the state over the past quarter-century but has never been spent. House Speaker Michael E. Busch said yesterday that his chamber would likely seek to withdraw $14 million for several dozen projects that had been promised bond money dating to 1984. Another $30 million for more recent projects will be heavily scrutinized.

Among the projects that could lose funding or be delayed is a proposed multimillion-dollar gym in East Baltimore for underprivileged residents. Lawmakers had secured $800,000 under two state bond bills since 2001 for the project, but it hasn't been built and only $75,000 of the state money has been spent, for studies and architectural drawings.

The State House is in the throes of negotiating a budget that must close a $2 billion shortfall. O'Malley, a Democrat, has submitted a balanced budget to the General Assembly, but is holding out hope for more than $3.5 billion in aid from a federal stimulus package moving through Congress to avoid some cost cutting. For their part, lawmakers have been signaling they might make even more drastic budget cuts.

"I don't want anyone to think we're not in a tough budgetary time," Busch said.

Busch said any bill that comes with a price tag would trigger a review by the 10-member leadership team in his chamber, echoing a sentiment of strict fiscal oversight sounded by Senate President Thomas V. Mike Miller in a memo this week.

Lawmakers also plan to build a bigger cushion into the operating budget for the next fiscal year than the $46 million cash balance in O'Malley's $14 billion spending plan. House Appropriations Chairman Norman H. Conway, an Eastern Shore Democrat, said he would leave a balance five times as large, perhaps more than $250 million, that could be tapped in case the economy worsens.

For the separate capital budget, House leaders announced new guidelines for bond bills, a system for funding projects undertaken by nonprofits or local governments that amounts to Maryland's version of pork-barrel spending. Under O'Malley's budget, lawmakers would have $15 million to direct to such projects.

Busch said only shovel-ready projects that could begin construction within 18 months and would create the most jobs would be funded. In addition, by withdrawing bond authorizations for projects that have languished, lawmakers free up borrowing capacity.

"It's not a given that a bond bill that's put in is going to be passed," said Del. Adrienne A. Jones, a Baltimore County Democrat. "We're going to look at them very, very carefully in light of our economic times."

Other projects that could lose unspent funding include the Eubie Blake National Jazz Institute and Cultural Center in Baltimore, and emergency departments at the Peninsula Regional Medical Center in Salisbury.

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