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Mar 14, 2008 6:35 pm US/Eastern
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Senate Resumes Budget Debate
ANNAPOLIS, Md. (AP) ―
The Maryland Senate gave final approval Friday to a state budget with roughly $390 million in cuts and spending transfers, and the House approved cuts to its budget measure with an eye toward leaving a bigger budget balance in case the economy worsens.
The Senate passed its budget bill 38-7 with little discussion, which frustrated Republicans.
Republican Leader David Brinkley, of Frederick, said he worried difficult fiscal times ahead may require more cuts later.
"Have we gone far enough? I don't think so," Brinkley said, who voted for the bill even though he believed more should have been done to rein in spending.
The Senate bill cuts about $226 million from the state's general fund, which is comprised mostly of income and sales taxes, and about half of the state's expenditures are made from it.
The measure makes up for about $315 million of the $333 million budget writedown last week in projected revenue estimates.
The budget approved by the Senate would leave a balance of about $158 million, which would be in addition to about $739 million projected for the state's Rainy Day Fund.
That would leave a total reserve of nearly $900 million for the state to draw in, if the economic downturn slides further.
The House was aiming toward deeper cuts in order to create a bigger general fund balance than in the Senate's bill, to better brace for another revenue writedown.
The House is looking to have a $248 million balance, which would leave nearly a $1 billion cushion when the Rainy Day Fund is added into the mix.
Like the Senate, the House is moving ahead with plans to reduce a planned $50 million fund for the Chesapeake Bay by half.
However, the House is limiting the $25 million reduction to fiscal year 2009, while the Senate proposed the reduction into fiscal year 2010.
The House also voted Friday for about $6.8 million in cuts to the University System of Maryland, just as the Senate did.
The House committee also voted to stretch out the purchase of MedEvac helicopters, like the Senate, netting a savings of about $60 million to the general fund.
A difference between the two chambers arose over stem-cell funding.
The Senate voted to cut stem-cell funding by $18 million from the $23 million proposed in Gov. Martin O'Malley's budget.
The House Appropriations Committee voted to cut it $8 million.
The House also differed from the Senate on plans to adjust how an extension of Medicaid to residents without health insurance, a plan approved in November's special session.
The Senate measure delays expanding Medicaid to parents by six months -- until Jan. 1 -- while the House is moving ahead with starting it on schedule.
The House committee also voted to reduce the amount of money set aside to subsidize small businesses to extend health insurance.
There was $30 million in the governor's budget for the subsidy, and the Senate cut it to $15 million.
The House wants to cut it to $10 million in the first year.
In another difference, the committee also voted to save $100 million in general funds by transferring payments for Other Post Employment Benefits, which are a part of the compensation package employees earn each year.
The Senate voted to transfer about $50 million for OPEB.
(© 2008 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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