A conference committee of delegates and senators has
resolved the differences between the two houses’ versions of the budget, just
four days prior to the legislative session’s scheduled conclusion.
Even though the two plans were not very different, the
legislature allowed the constitutional target date of April 1 to slip by before
concluding the budget process. Legislative leaders may have been awaiting the resolution
of other legislation (such as the firearm safety act) and a supplemental budget
proposal from the governor before finalizing their budget action.
The final budget left intact 98.8 percent of the funding
proposed by Governor O’Malley in January.
Key Conference Committee decisions
- One of the major differences between the House
and Senate budget plans related to pension contributions and fund balances. The
2011 pension reform law called for the state to make an extra contribution of
$300 million to the teachers’ and employees’ pension funds next year. The Senate cut this to $200 million, and added
the savings to the general fund balance, so it could be available if needed to
absorb the effects of federal cutbacks.
The conference committee accepted
the cut to the extra pension contribution, but placed it in the “Dedicated
Purpose Account” of the state reserve fund. This way, it could be used by the
governor (subject to review by legislative committees) without the need for
action by the whole legislature. By using this mechanism, the governor could
replace funding for critical services without either waiting for the 2014
legislative session or calling a special session.
Any unused amount would be
forwarded to the pension fund after the end of this calendar year.
Counting this addition to the contingent
fund the final amount of balances ($1.16
billion) is close to the amount recommended by the Senate.
- The conference committee accepted most of the items in Governor O’Malley’s proposed supplemental budget, with these exceptions:
The conference committee rejected $432,000
in general funds to cover part of emergency management and National Guard
expenditures for the derecho and Hurricane Sandy. The conference committee
suggested that the agencies be allocated the funds from the state’s Catastrophic
Event Fund. That fund has $1 million available.
The conference committee directed
that $300,000 included by the governor for the Towson University men’s baseball
team should instead be used as matching funds for an intercollegiate athletics
donation incentive program. The program would provide matching funds for
Division I schools in the University of Maryland System to support sports to
maintain compliance with Title IX requirements.
Next steps
Update: The House and Senate have both approved the conference committee report and passed the budget bill in final form. The
budget bill becomes law immediately upon passage by the legislature and does
not require the Governor’s signature.
