To save money, Md. should scrutinize private contractors, tax breaks

March 16, 2010

In a March 16 column ("For 'Sunshine Week,' lift the veil on state grant-making") Marta H. Mossburg pointed out that this is "Sunshine Week," a time dedicated to promoting transparency in local, state and federal government.

The Maryland branch of the American Federation of State, County and Municipal Employees would like to add another item to the list of expenditures that should be subject to greater sunshine and potential cuts.

Maryland's state budget includes hundreds of services that are contracted out to the private sector. Even excluding medical and community service provider payments, contractual services comprise 9 percent of the state budget. These services include management consulting, information technology, custodial and housekeeping services. While state employees have endured staffing cuts, furloughs and pay cuts, have these services been renegotiated due the fiscal crisis? It appears not. Statewide, a 20 percent savings on contracts would free up $200 million in the general fund.

Tax breaks are another hidden cost in the Maryland state budget. Unlike state services, tax breaks do not undergo consideration and possible cuts each year but instead continue unexamined year after year. Tax expenditures grew by nearly 7 percent in 2009 and reach $3.7 billion in 2010. Given the immediate fiscal crisis, the state could identify ineffective or low-priority tax expenditures to generate savings in the budget. A 10 percent reduction would generate $45 million.

AFSCME MD has released a complete report on possible ways to assist in balancing the budget. To continue going to state employees to balance the budget through furloughs, pay cuts and reduced staffing is not the answer. Such cuts translate into reductions to key services that protect Maryland's children and keep our neighborhoods safe. It is time to broaden consideration of cuts to new areas. To see a copy of our report, please go to our website, www.afscmemd.org.

Patrick Moran, Annapolis

The writer is director of AFSCME of Maryland.

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