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State debates cutting local aid

New furloughs also eyed to fill $516 million budget gap

March 12, 2009|By Laura Smitherman , laura.smitherman@baltsun.com

Lawmakers also might change the distribution formula for taxes that go to a transportation trust fund and reduce money sent to localities for maintaining highways and roads. That could yield about $80 million.

Other ideas would be to reject the governor's proposal to extend a tuition freeze at public universities for a fourth year, to cut aid to community colleges and to trim funding for preserving open spaces.

Two areas that Miller and Busch said would likely not be affected are education and Medicaid. Much of the federal stimulus money was earmarked for those purposes.

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They also said it is unlikely that they would shift the cost of teacher pensions to local governments this year. Miller and Busch announced yesterday a joint work group that will meet after the session ends to examine local aid, including the state's more than $700 million yearly subsidy of pension costs.

Comptroller Peter Franchot, the state's chief tax collector, said he hopes O'Malley and the legislature examine the state's spending to "get ahead of the recession so we don't have to continually come back and make cuts."

Republicans lambasted the governor's fiscal stewardship.

"We saw this happening and we could have taken action before but we didn't," said Sen. David R. Brinkley, a Frederick County Republican and member of the Budget and Taxation Committee. "The squall that we saw coming is now a hurricane."

IDEAS FOR CUTS

General Assembly leaders offered several ideas yesterday for making $516 million in additional cuts to a state spending plan to be approved in the next few weeks:

* More furloughs for state employees, many of whom must take five unpaid days by the end of June.

* Asking counties to repay a combined $30 million in education aid mistakenly received through a state calculating error.

* Transferring the cost from the state to counties of $120 million in disparity grants received by poorer jurisdictions such as Baltimore.

* Shifting taxes from the transportation trust fund to general government operations.

State's tuition plan deficit rose to $80 million last year. PG 16

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