Halfway Through Budget Hearings: Recommended Cuts Total $101 Million So Far

With the General Assembly’s budget committees about halfway through their hearings, the biggest challenge facing lawmakers is how to continue investing in services that Marylanders rely on every day.

As the committees debate and amend the budget proposal, they are guided, in part, by the Department of Legislative Services’ (DLS) in-depth budget analysis. Last month DLS cautioned that the governor’s budget—while balanced—does not leave enough of a cushion at the end of the year to account for unexpected expenses during the year. Subsequently, as the committees work through each agency’s budget, DLS offers a menu of recommended cuts for each agency. While the legislature cannot add new money to the governor’s budget proposal, they can cut spending in some areas and transfer those funds to other priorities elsewhere in the budget. 

DLS is recommending several good solutions, including:

• Replacing $30 million allocated for debt service reduction with proceeds from anticipated sales of bond premiums.  
• Reducing various personnel and administrative costs in state agencies by $27.2 million, mostly through eliminating vacant positions or through technical adjustments, like turnover rates and cost-of-living adjustments. 
• Cutting $17.6 million from the Department of Agriculture, since this amount was already paid for by the Chesapeake and Atlantic Coastal Bays 2010 Trust Fund.

Unfortunately, not all of DLS’s recommendations were so good. In fact, some of the agency’s recommended reductions would cut money from important state programs and services, including: 

• $14.4 million cut to economic development efforts, which includes $8.9 million for the Maryland Economic Development Assistance Authority and Fund (MEDAAF), $2 million for a biotechnology tax credit, $1 million for a cyber-security tax credit, and $2.5 million in tourism development grants. 
• Cuts to investments that support Maryland's working families, which include a $3.6 million for job training through Employment Advancement Right Now (EARN), $2 million for child care assistance, $500,000 grant for the Maryland Food Bank, and a $100,000 grant for Roberta's House. 
• $3 million cut to foster care
• $799,000 cut to agricultural land preservation through the Tobacco Transition Program
• $125,000 cut to the Department of Aging's Maryland Access Point

Lawmakers should think twice before cutting any of these programs, and should instead focus their efforts on other parts of the budget.

Next month the Board of Revenue Estimates (BRE) will release updated forecasts of state revenue for Fiscal Years 2014 and 2015.  Any increases from the December forecast will provide additional flexibility and funding as the General Assembly moves towards passing their final budget plan in April. 

As the budget committees continue their work, check back here for updates.