Apr 1, 2009 6:50 pm US/Eastern
Senate Takes Up Maryland Budget
ANNAPOLIS, Md. (AP) ―
The Maryland Senate gave preliminary approval to its version of the state's $13.8 billion operating budget on Wednesday, making more cuts than the House of Delegates to create a bigger financial cushion if the economy worsens.
The Senate is scheduled to take up a companion budget reconciliation bill later Wednesday that is needed to help address a $1.2 billion drop in revised revenue projections earlier this month.
"We've seen record declines in general fund revenues," said Sen. Ulysses Currie, who chairs the Senate Budget and Taxation Committee. "Federal stimulus money is a big help. It is creating jobs and helping us avoid more painful cuts to the budget, but we will only have this extra money for two years."
Through the two bills, the Senate would cut more than $900 million in fiscal years 2009 and 2010, compared to about $825 million in cuts made by the House.
The two sides are set to work out their differences on Friday and Saturday.
Both versions contain significant cuts in aid to local governments.
In one of the biggest differences, the Senate wants to cut $162 million in state aid for local road maintenance, snow removal and road paving. The House has approved a $102 million reduction.
The extra $60 million would offset a cut that the House made to the local "piggyback" on the state income tax.
Maryland is one of the few states that enables counties to take up to 3.2 percent in income tax from taxpayers through the state's income tax.
The Senate also wants to boost money in the general fund budget by about $21 million by requiring local governments to pay half the cost borne by the state for offices that estimate property values.
In addition, the Senate wants to take back about $23.5 million from managed health care organizations that had profits of more than 2 percent in 2007 and 2008 in their work through Medicaid.
Under the budget bill amended by the Senate, money for stem cell research would be cut by $13 million, while the House kept the entire $18.4 million.
The Senate also relies on using more money than the House from Program Open Space, which uses part of the state's real estate transfer tax to buy public land.
The House bill uses about $118 million in open space money for budget-balancing maneuvers.
But the Senate wants to use an additional $65 million, using about $40 million in state money and $25 million in local money.
The state's public campaign financing fund, which contains about $5 million, has been eyed by both the House and Senate for separate purposes.
The Senate would use about $3 million for a new voting system with optical scans of paper ballots. The House wants to use about $2 million to implement early voting in the state.
The fund has not been used since 1994, when Republican Ellen Sauerbrey ran for governor, and the two proposals brought criticism from members of the GOP, who want the fund intact in case a Republican in Democrat-controlled Maryland needs the money to run for governor.
The Senate changed the budget bill to adjust spending in an education fund designed to help areas where schooling costs more.
The Senate wants to restrict that all of $50.5 million be spent on public school construction projects, instead of 60 percent.
The Senate also approved an amendment by Republican Sen. David Brinkley in the budget bill that would prohibit the state's Motor Vehicle Administration from spending any money to issue a driver's license to someone who can't document that they are in the country legally.
The House has approved separate legislation that would create a two-license system, one for illegal immigrants and another for legal residents, but a Senate bill would deny licenses to illegal immigrants.
The Senate budget bill cuts more money to leave a $140 million fund balance to help prepare in case the economy continues to sour.
The House version leaves about $51 million. Both amounts still fall far short of goals and recommendations to create a better budget cushion.
House leadership initially hoped to build in at least $200 to $250 million.
A top budget analyst had pushed lawmakers to reach for about $460 million.
Maryland is facing deficits of hundreds of millions of dollars in future years for as far as budgetary eyes can see.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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