Deep cuts noted in O'Malley budget

$13 billion plan called 'responsible' in defense against Senate trims

March 13, 2010|By Annie Linskey | annie.linskey@baltsun.com

Administration officials defended Gov. Martin O'Malley's proposed $13 billion budget for next year, saying it includes deep cuts that don't jeopardize improvements in education and public safety.

"The bottom line is the governor's budget reduces spending by more than $2 billion - but does so in a responsible way," spokesman Rick Abbruzzese said yesterday. "Never before has a legislature been asked to consider a proposed budget that reduces spending by such a magnitude."

The push came in response to members of the Senate budget panel saying they are poised to cut an additional $500 million to $600 million from O'Malley's budget.

The governor's budget reduces spending by about $1 billion, with cuts to health care and local governments, as well us using furloughs and the so-called rainy-day fund. It also relies on about $1 billion in one-time accounting moves, including borrowing from a reserve fund that holds income taxes before they are distributed to local governments, as well as federal stimulus funds. The plan leaves unspent $274 million.

By law, O'Malley must submit a balanced budget. But senators are looking to the future, when stimulus money will not cushion the spending plan, and they want to leave a larger reserve. Senators are set to begin voting on proposed cuts Monday, but they did not offer specifics Friday afternoon.

Bracing for years of tighter spending, senators also are discussing freezing the formula-driven annual budget increases that drive hundreds of millions in projected deficits over the next four years.

Sen. Richard S. Madaleno Jr., a member of the Budget and Taxation Committee and former budget analyst, said the formulas leave the public with the false impression that "we are trying to do it all," he said. "Let's cut out the growth because it is all aspirational."

The most significant formula-driven expense is the so-called Thornton funding, which determines the amount of spending on K-12 education. Another expensive formula the body might reduce is the automatic funding to private universities used for financial aid.

Abbruzzese said O'Malley is "willing to work" with members interested in freezing the formulas.

Several senators have expressed a strong interest in moving some of the costs of teacher pensions to the counties, a move that the governor and House leaders have resisted.

A budget plan offered by Republican Sens. David R. Brinkley and E.J. Pipkin would save $450 million by placing about half of the cost of teacher pensions on local districts, though it is unlikely the Senate would go that far.

The House would have to approve any changes made in the Senate. Budget leaders there said they like the idea of increasing the cash balance but have not discussed numbers.

"We are anxious to see their budget," said Del. John L. Bohanan Jr., a St. Mary's County Democrat on the Appropriations Committee. He said there's been some discussion in his chamber about how state revenues for the gasoline tax are distributed so more money could go to the counties. But that would also mean the state would take another budget reduction.

Like the Senate, he said, the House is giving careful thought to a Republican budget plan, with members giving a hard look at ideas including curtailing a program that subsidizes tuition for University of Maryland employees and reducing funding to Maryland's public universities and colleges.

"We do manage pretty conservatively," Bohanan said.

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