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Posted at 5:20 PM ET, 02/ 4/2011

677 Md. employees take early retirement, a tally smaller than expected

By Aaron C. Davis

Thumbnail image for CSC_0400.JPGMaryland's health and transportation departments will be among those hit hardest by losses of hundreds of state workers to early retirement under a plan approved by Gov. Martin O'Malley (D).

But O'Malley's voluntary buyout program will fall nearly 30 percent short of a goal of saving the state $40 million next year, according to figures the governor's office released on Friday.

The spending plan for the coming year that O'Malley released last month assumed 1,000 of nearly 1,400 state workers who had applied for the buyouts would be eligible to leave. But there were complications with hundreds of the applications, and only about 61 percent of those reviewed were accepted, the governor's office said.

In all, 677 employees will permanently leave Maryland's payroll, saving the state's general fund $28.8 million, or less than 2 percent of its estimated $1.6-billion shortfall for the budget year beginning in July.

The smaller-than-expected buyout tally will add $11.2 million to the state's projected shortfall. The governor's office said the amount can be absorbed in the proposed budget by lowering by 9 percent the projected year-end balance of $120 million. The legislature is still debating the governor's budget proposal.

But effectively, public employee costs will rise for Maryland next year.

The savings from the buyouts amount to less than half of the roughly $70 million the state trimmed in each of the last two years through mandatory furloughs of nearly 80,000 state workers.

And just last month, the administration agreed to $750 bonuses for most state workers, guaranteed pay raises for the next three years, and a salary-grade increase in 2014. Members of Maryland's chapter of the American Federation of State, County and Municipal Employees voted overwhelmingly Wednesday to ratify that contract. The union was one of O'Malley's most vocal supporters last year during his successful re-election effort.

O'Malley's budget closes the bulk of the state's shortfall through cuts, and continued borrowing from an array of funds earmarked for environmental, transportation and other special projects. His budget also increases a levy on hospitals and cuts provider rates for doctors. He also banks on savings from a proposed plan to increase state employees' annual contributions to their pensions.

These are the agencies with the most buyouts:

125 - Maryland Department of Transportation
124 - Department of Health and Mental Hygiene
105 - Department of Human Resources
65 - Department of Public Safety and Correctional Services
36 - Maryland State Department of Education

By Aaron C. Davis  | February 4, 2011; 5:20 PM ET
Categories:  Aaron C. Davis  
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You should follow up your article to find out how many employees actually wanted to participate in the VSP buyout. Many more than the 667 noted here wanted to be a part of the program. Agencies had to give up positions (pins) in order for employees to take advantage of VSP. And agencies didn't want to give them up!

Posted by: swannrl | February 7, 2011 12:07 PM | Report abuse

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