Maryland LCV-Budget decisions await new General Assembly

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Budget decisions await new General Assembly

Advocates look for new governor O’Malley to fulfill his campaign pledges on schools and health care spending

Wednesday, Jan. 3, 2007

ANNAPOLIS — It’s the first year of a new administration and expectations are high for Gov.-elect Martin O’Malley. A looming structural deficit could hamstring his ability to fulfill numerous campaign pledges, but neither he nor legislative leaders have taken much off the table.

Consider a jam-packed legislative agenda that includes up to $400 million in school construction funding and more money for Thornton, health care reform, the possible reintroduction of slots or a tax increase, changes to the state’s voting system and a cleaner environment. And that’s just a sampling of what’s in store for 2007.

Maryland’s 61st governor will take the oath of office on Jan. 17, and lawmakers say his first year will be relatively smooth. The road gets bumpy after that.

‘‘In the short term, we have a very manageable problem,” said Sen.-elect Richard S. Madaleno Jr. (D-Dist. 18) of Kensington, one of the legislature’s fiscal experts. ‘‘In the long term, we have a very dire problem.”

Budget deficits will begin to accumulate in fiscal 2008, which begins July 1. The negative numbers will total $6.6 billion through fiscal 2012, according to budget forecasts.

That leaves O’Malley (D) and lawmakers with the uncomfortable dilemma of cutting existing programs or generating new revenues through tax increases or slot machines.

Slots advocates say the state’s long-term fiscal outlook wouldn’t look so bleak if the legislature had embraced earlier gambling proposals.

‘‘We wouldn’t be in this problem if we had adopted the slots plan four years ago,” said Senate President Thomas V. Mike Miller Jr. ‘‘In fact, we’d have a surplus. We wouldn’t be patching together this budget.”

Slots could come back during this year’s session, although House Speaker Michael E. Busch (D-Dist. 30) of Annapolis remains cool to the idea.

‘‘I don’t even know why it would be brought up,” he said. ‘‘... I don’t see any enthusiasm” for slot machine legislation in the House.

Miller acknowledged that legalizing slots isn’t the ‘‘best idea” to refill the state’s coffers, but it is a ‘‘practical idea.”

Party power

The return of a Democrat to Government House has the blue-hued legislature eager for a better relationship with the O’Malley than they had under Republican Gov. Robert L. Ehrlich Jr.

‘‘There’s a feeling of euphoria over here in the State House,” said Miller (D-Dist. 27) of Chesapeake Beach, whose relationship with Ehrlich soured during the past year. ‘‘The tension is gone.”

That means O’Malley should find little resistance from a body where nearly three out of every four legislators are Democrats.

‘‘I think there’s such a good feeling at the present time that almost any issue of substance that he feels can benefit the state would pass the Senate and House,” Miller said.

But with dozens of new legislators descending on the state capital, some say there will be an adjustment that will result in a ‘‘quiet” first year. Nearly one-quarter of the membership in both chambers — 34 delegates and 11 senators — are freshmen.

‘‘There will be a feeling out of the new governor and the new legislature,” said House Majority Leader Kumar P. Barve (D-Dist. 17) of Gaithersburg.

Even Republicans, who lost the governorship and six House seats, enter 2007 with an upbeat perspective. O’Malley has already reached out to both newly elected minority party legislative leaders.

‘‘Hopefully, we start with a clean slate and that all things are possible,” said incoming House Minority Leader Anthony J. O’Donnell (R-Dist. 29C) of Lusby. ‘‘I am encouraged by the outreach on both sides. ... The political season has ended, and now it’s time for all of us to get to work.”

Money blues

The budget will hang over nearly every issue that comes before the legislature. O’Malley’s first budget is projected to have a $413 million shortfall. But by law, every Maryland budget must balance.

O’Malley has pledged to spend $400 million on school construction, but legislative leaders have already questioned whether that’s realistic.

O’Malley also said he is ‘‘poised” to fully fund Thornton, the $1.3 billion landmark education funding plan passed in 2002 without a revenue source. His promise includes the geographic cost of education index, or GCEI, a controversial component of Thornton that is estimated to cost about $96 million in fiscal 2008.

That’s in addition to $810 million in new money for Thornton that is due in fiscal 2008. Remove Thornton from the equation, and the budget outlook is more upbeat, one lawmaker said.

‘‘I don’t know that you could call it being on Easy Street, but we would be a lot closer” to balancing the budget, said Del. John L. Bohanan Jr. (D-Dist. 29B) of California.

But that’s not all. The General Assembly is expected to consider freezing in-state college tuition, preparing for growth around military bases in Anne Arundel and Harford counties while revisiting one of last year’s dominant themes, electricity deregulation.

Providing money for needed transportation projects is another top priority in Annapolis.

With the 2008 presidential election on the horizon, Democrats will push for a constitutional amendment on early voting. September’s primary election fiasco is likely to spur more interest in adding a ‘‘paper trail” to the state’s embattled electronic voting system.

Many of these initiatives carry lofty price tags, and counties are pleading their case to maintain local funding levels, which have been a previous target of budget cutters. State aid to local governments has declined by about $580 million in the past four years, said David Bliden, executive director of the Maryland Association of Counties.

‘‘Cutting funding to the counties is not structural reform. It’s just Washington-style shift-and-shaft politics,” Bliden said. ‘‘It takes state officials ... out of the tough decision-making and just forces that tough decision-making down the food chain ... and the county officials have no place to pass the buck, because they sit at the bottom of the fiscal food chain.”

Meanwhile, health care advocates are promoting ways to expand health insurance and make it more affordable. One is a $1 increase on the cigarette tax, which proponents say also will curtail teen smoking.

‘‘It’s a public health win-win,” said Vincent DeMarco, president of the Maryland Citizens’ Health Initiative. The proposal has won the support of 80 lawmakers, Attorney General Douglas F. Gansler (D) and Comptroller-elect Peter V.R. Franchot (D).

Miller said lawmakers also will examine a universal health coverage plan passed recently in Massachusetts to see if something similar could be adopted in Maryland.

Environmentalists, who heavily supported O’Malley in the election, are also looking for a piece of the budget pie. They will seek more money for open space programs and Smart Growth, a clean car bill that seeks to reduce vehicle emissions and continued efforts to restore the Chesapeake Bay watershed.

‘‘During the Ehrlich administration, it was pretty clear that environmentalists did not have a seat at the table and now we do,” said Cindy Schwartz, executive director of the Maryland League of Conservation Voters.

Staff Writer Douglas Tallman contributed to this report.

J. Adam Fenster⁄The Gazette

Danny Bitner of the Department of General Services repaints the red no-parking zone in front of the State House’s main entrance in preparation for the new session