Gen­eral As­sem­bly lead­ers pre­dict ‘tough’ bud­get cuts

Cecil Whig - - A••END A FREE - By ERIN COX

BAL­TI­MORE

The Bal­ti­more Sun

— Top state law­mak­ers pre­dicted tough bud­get cuts Fri­day and said the Trump ad­min­is­tra­tion cre­ates un­cer­tainty about Mary­land’s eco­nomic fu­ture.

Se­nate Pres­i­dent Thomas V. Mike Miller and House Speaker Michael E. Busch promised that an ex­pected bud­get gap of roughly $400 mil­lion would not be closed through new taxes or fees. But the Democrats warned lo­cal of­fi­cials to pre­pare for un­pop­u­lar spend­ing cuts.

“We’re go­ing to have to cut some pro­grams,” Miller said, speak­ing at the Mary­land As­so­ci­a­tion of Coun­ties con­fer­ence here.

Both Miller and Busch said they fear more fi­nan­cial trou­ble if Repub­li­can Pres­i­dent-elect Don­ald J. Trump fol­lows through on cam­paign prom­ises to re­peal the Af­ford­able Care Act and “drain the swamp” by re­duc­ing the fed­eral work­force, which em­ploys thou­sands of Mary­land res­i­dents.

The Gen­eral As­sem­bly’s pre­sid­ing of­fi­cers did not sug­gest cuts to spe­cific pro­grams, say­ing they will wait to see Gov. Larry Hogan’s bud­get pro­posal first. The state bud­get al­lo­cates spend­ing for ed­u­ca­tion, pub­lic safety, health, trans­porta­tion and nu­mer­ous other needs.

They promised to pro­tect spend­ing on K-12 ed­u­ca­tion as the Demo­cratic-led leg­is­la­ture and Hogan, a Repub­li­can, de­vise ways to pare back the state’s more than $42 bil­lion bud­get.

They also pledged Fri­day to open the leg­isla­tive ses­sion that be­gins in Jan­uary by at­tempt­ing to over­turn the gov­er­nor’s veto of a re­new­able en­ergy law. The law would re­quire the state to ob­tain a greater share of its power from re­new­able sources. Hogan said it would cause an un­ac­cept­able in­crease in con­sumers’ util­ity bills.

The pres­i­dent and speaker com­mented on the bud­get a day af­ter fore­cast­ers fur­ther re­duced rev­enue es­ti­mates, say­ing more than $820 mil­lion in tax money ex­pected over the next two years will not ma­te­ri­al­ize.

In Oc­to­ber, the leg­is­la­ture’s top an­a­lysts warned law­mak­ers it was time to “get real” about Mary­land’s chronic bud­get prob­lems, say­ing they can no longer be blamed on bad eco­nomic con­di­tions.

For most of the past decade, law­mak­ers have seen pro­jected spend­ing out­pace rev­enue, an im­bal­ance caused pri­mar­ily by the eco­nomic down­turn but ex­ac­er­bated by laws that man­date spend­ing in­creases re­gard­less of the money avail­able. In re­cent years, rev­enue es­ti­mates have been off dra­mat­i­cally, in large part be­cause state of­fi­cials over­es­ti­mated how much wealthy peo­ple would earn in cap­i­tal gains.

Miller and Busch sug­gested long-term changes to help solve the prob­lem, but stopped short of en­dors­ing Hogan’s plan to dra­mat­i­cally and per­ma­nently cut back man­dated spend­ing.

Busch said gover­nors have his­tor­i­cally looked to save large amounts of money by spend­ing less on pub­lic col­leges and uni­ver­si­ties — which would in­crease tu­ition — re­duc­ing spend­ing on pris­ons and trim­ming what the state pays doc­tors who treat the poor through Med­i­caid.

“It’s go­ing to be a tough year,” Busch said, adding that if Hogan re­duced spend­ing on K-12 ed­u­ca­tion, he would be the first gov­er­nor in mod­ern his­tory to do so.

Hogan spokesman Doug Mayer said the gov­er­nor would not re­veal de­tails of his spend­ing plan un­til mid-Jan­uary.

“The gov­er­nor re­ally be­lieves that we need to take a hard, good look at how much the state is spend­ing ev­ery sin­gle year,” Mayer said. “Once again, we’re in a sit­u­a­tion with 3-plus per­cent growth in rev­enues and we’re in a bud­get hole.

“This is go­ing to con­tinue hap­pen­ing un­til we take a se­ri­ous look at man­dated spend­ing.”

Law­mak­ers left An­napo­lis in April hav­ing ap­proved a bud­get with a sur­plus and be­liev­ing the state could af­ford roughly $300 mil­lion in tax cuts. Re­vised rev­enue es­ti­mates have changed that out­look.

Both Busch and Miller said the state’s fi­nan­cial trou­bles would worsen if the fed­eral gov­ern­ment sheds jobs un­der the Trump ad­min­is­tra­tion.

“The bad news is that we’re a com­pany town,” Miller said, re­fer­ring to the thou­sands of fed­eral work­ers who live in Mary­land. “We’re tied to the fed­eral gov­ern­ment. We’re de­pen­dent on those jobs.”

Keif­fer Mitchell, a se­nior aide to the gov­er­nor, said Hogan plans to an­nounce a “ro­bust” pack­age of leg­is­la­tion dur­ing the 90-day Gen­eral As­sem­bly ses­sion that be­gins Jan. 11.

Mitchell said that in ad­di­tion to a pro­posal an­nounced Wed­nes­day to re­quire large com­pa­nies to pro­vide paid sick leave, the gov­er­nor also plans to re­vive leg­is­la­tion to of­fer tax breaks to man­u­fac­tur­ing com­pa­nies that move to three ar­eas of the state with high un­em­ploy­ment — Bal­ti­more, the East­ern Shore and West­ern Mary­land.

That bill died in com­mit­tee last year over con­cerns that the gen­er­ous tax ben­e­fits would put man­u­fac­tur­ers al­ready in Mary­land at a dis­ad­van­tage.

“We’ve worked out some of the kinks,” Mitchell said Fri­day.

The gov­er­nor will once again seek to change how Mary­land re­draws con­gres­sional and leg­isla­tive dis­tricts, Mitchell said, and to push leg­is­la­tion per­ma­nently re­duc­ing how much Mary­land spends.

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