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Miller seeks 'prudent' cuts to O'Malley's budget

Thumbnail image for mike miller.jpgGov. Martin O'Malley's office was still distributing budget books Wednesday when Senate President Thomas V. Mike Miller Jr. (D-Calvert) let reporters know that he has several "tweaks" in mind.

As a general rule, the legislature in Maryland cannot add to the governor's budget but is empowered to make cuts. Miller said he does not plan "to take a meat ax to the budget" but said he expects his chamber's budget committee will make "some prudent cuts" to O'Malley's proposal.

"I think they should look across the board," Miller said.

Asked for an example, he cited the $20 million O'Malley (D) has proposed for a Chesapeake Bay cleanup fund created in 2007.

"The Bay fund is great," Miller said, "but that could be cut. ... Nothing is sacrosanct."

Miller said he also thinks O'Malley went too easy on Maryland counties. State aid to local governments, including education funding, accounts for about 40 percent of the state general fund.

"Obviously they should be bearing more" of the budget cuts, Miller said.

More broadly, Miller said he wants to reassure bond ratings agencies, which will be looking at whether O'Malley's proposal does enough to stabilize the state's long-term budget outlook.

"I don't want to lose that bond rating," Miller said, referring to Maryland's coveted AAA status, which allows the state to borrow money at favorable interest rates.

Miller's comments came as analysts began pouring through 2,769 pages of budget details O'Malley's office released Wednesday morning.

An initial analysis by John W. Rohrer and Warren G. Deschenaux of the state's nonpartisan Department of Legislative Services found the state's total spending, including capital projects would be $32 million. Proposed spending in the general fund -- the state's primary operating budget -- would total $13.2 billion, or 2 percent less than in the current year.

The review also found that if O'Malley's budget is approved, Maryland's reliance on federal stimulus money in the coming year would grow to $1.3 billion. The state's currently using $1.1 billion to close a gap in the current year.

Other details from that and other reviews:

* Under the governor's budget, Maryland would not follow best accounting practices in choosing to borrow $350 million from a local income tax fund.

* Medicaid funding would rise to $6.1 billion, an increase of 3.4 percent, even though the governor would cut reimbursement rates to hospitals. Most of the increase is attributable to higher federal spending.

* Education aid would increase 3.5 percent, to $5.7 billion, with the exception of a $4.3 million scaling back of grants for school bus transportation.

* Higher education spending would remain constant at $1.1 billion. A tuition increase of 3 percent for in-state students at the University System of Maryland would cover rising costs.

-- John Wagner and Aaron C. Davis

By John Wagner  |  January 20, 2010; 1:19 PM ET
Categories:  Aaron C. Davis , General Assembly , John Wagner , Maryland State Budget  
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