Maryland lawmakers decided Tuesday to take more than $160 million in road maintenance funding from local governments to help plug a hole in next year's state budget.
Senators and delegates are nearing completion of their negotiations on the state's almost $14 billion spending plan for the fiscal year that begins July 1. The two chambers must resolve their differences before the General Assembly adjourns Monday.
They also addressed higher education funding, pornography at the University of Maryland, College Park and excess profits earned by Medicaid contractors.
The task of balancing the annual budget has been particularly complicated this year as lawmakers have worked to absorb billions of dollars in federal stimulus money while cutting elsewhere to account for plunging tax revenues. Lawmakers began Tuesday's meeting $75 million away from a balanced budget and ended with a $20 million cash balance, analysts said. They plan to meet again Wednesday.
Local governments have complained that the state shouldn't be balancing its budget on their backs and warned that doing so would force them to curtail local services. While lawmakers dropped proposals to divert $60 million in local "piggyback" income tax revenue to state coffers, they decided to reduce highway user funds by that amount - in addition to $102 million already cut.
About one-third of the local share of highway user funding, which comes from gas and car titling taxes, would be lost under the proposal, said Michael Sanderson, legislative director for the Maryland Association of Counties. He added that local governments maintain 80 percent of the state's road miles.
"Some jurisdictions are going to have to put off maintenance and repair," he said. "And some might have to put in cash, and it's not like locals are swimming in cash. They are dealing with layoffs and furloughs."
Lawmakers also struck a compromise on funding for the University System of Maryland, cutting nearly $6 million and transferring $29 million from its reserves.
Gov. Martin O'Malley has made it a priority to extend a tuition freeze for a fourth year, but university officials have raised concerns about their ability to follow through given the extent of the budget cuts. Lobbyist Patrick J. Hogan said the university system would review the latest proposal.
The conference committee proposed resolving a dispute with the state's flagship campus over the showing of a hard-core pornographic movie Monday by requiring universities to adopt policies by September on using public facilities for displaying or screening pornographic films and materials.
Students showed portions of a film, marketed as rated XXX, in a campus lecture hall Monday night after university officials had canceled a full-length screening amid outrage in the Senate.
In addition, the committee decided against taking back $23.5 million from Amerigroup Corp. and other managed care organizations that exceeded a regulatory profit limit of 2 percent over the past two years. Instead, lawmakers called on regulators to conduct market studies and financial exams of companies that oversee health plans under Medicaid, the government health care program for the poor.