ANNAPOLIS, Md. (AP) — Maryland’s $1.6 billion shortfall for the next fiscal year is presenting as puzzling a challenge as ever for Gov. Martin O’Malley and lawmakers returning for the Maryland General Assembly’s 90-day session, following four years of hard choices compounded by the recession.

O’Malley, who will submit his budget proposal to lawmakers later this month, describes it as the most difficult he has ever had to put together, as lawmakers convene Wednesday for the first day of the session.

“It’s a Rubik’s Cube of really painful choices, and however you twirl and adjust that Rubik’s Cube, at the end of the day it’s still a cube of very painful choices,” said O’Malley, a Democrat.

“This next budget that I submit is going to be balanced entirely with cuts, and that will be the beginning of the conversation that we’ll have with the members of the General Assembly.”

While the state has contended with bigger shortfalls under O’Malley, who was re-elected in November, the state does not have federal stimulus money this time to help soften the blow. The state also has pushed its debt limit in recent years, significantly cutting into the amount of bonds available for a variety of competing needs for state facilities, health and social services, education and public safety. In recent years, lawmakers have resorted to spending transfers from various state funds to help balance the books, but those options have dwindled.

“We’ve raided every pot of money,” said Delegate Gail Bates, R-Howard. “There’s no easy fixes.”

It remains unclear how the shortfall will affect jobs in state government. O’Malley struggled to avoid layoffs as much as possible during the recession, and he hopes to avoid another year of furloughs for state employees, but he hasn’t ruled them out yet.

Lawmakers also will be grappling with the state’s long-running problem of more than $18 billion in unfunded pension liabilities over 25 years. Maryland also has unfunded health care liabilities that are estimated to be about $15 billion. A state commission has proposed that state employees work years longer before becoming eligible for pensions or retiree health care benefits, an idea that was quickly criticized by union leadership.

O’Malley has ruled out passing on pension costs to the state’s counties. That’s sure to raise debate in the Legislature, where state Senate President Thomas V. Mike Miller, a Democrat, has favored a push to begin making counties take on some of the burden.

O’Malley has so far ruled out initiating tax increases, but some are bound to come before lawmakers.

House Speaker Michael Busch, D-Anne Arundel, said lawmakers are waiting to see what O’Malley’s budget proposal will be.

“The governor has said he’s not going to initiate a revenue increase,” Busch said in an interview Monday. “I mean, I think he’s open to it if there’s some kind of groundswell from either local governments or legislators who feel that there’s programs that are getting cut that they want to continue to fund.”

Republicans say they’re not convinced new taxes are off the table.

“I think the Legislature will both try to raise taxes and try to push pensions on to the local governments, which is the worst possible thing we can do in this economy,” said Delegate Anthony O’Donnell, R-Calvert, the House minority leader.

One tax proposal that has been floated in the past is a dime-a-drink increase in the state’s alcohol tax, which would raise an estimated $200 million. Supporters of the idea point out that the tax on beer and wine hasn’t been raised since 1972, but opponents say it could hurt business in restaurants and bars.

Some also are talking about the possibility of a gasoline tax increase to help rejuvenate funding for transportation needs. That tax hasn’t been raised since 1992.

The state’s budget situation promises to rekindle debate on how much state money will go toward cleaning up the Chesapeake Bay.

Last year, when the Chesapeake Bay Trust Fund was due to receive about $42 million, O’Malley budgeted $20 million, which lawmakers kept after debating whether to cut it down to as low as $10 million.

Environmentalists are hoping O’Malley will propose legislation requiring utilities to commit to long-term contracts to buy offshore wind energy. In November, O’Malley appeared with Interior Secretary Ken Salazar at Baltimore’s Fort McHenry, where the secretary vowed to spur offshore wind projects in the Atlantic Ocean by expediting permits and identifying promising areas for wind power.

“There’s momentum,” said Mike Tidwell, executive director of Chesapeake Climate Action Network.

Social issues like same-sex marriage are also expected to come before the General Assembly. Busch said he expected a serious debate on same-sex marriage legislation. Maryland law currently only recognizes marriage between a man and a woman.

Campaign finance reform legislation also is expected to come before lawmakers, following a report issued earlier this month by Attorney General Doug Gansler.

(Copyright 2011 by The Associated Press. All Rights Reserved.)

Comments (9)
  1. elaine lickman says:

    get the people that are on welfare & living better than the working person off of the program more than half are abusing it anyway, and loving life. They need to have more people checking up on these scamers. Welfare is not what it use to be, powered milk & a block of cheese, instead it has turned into steak and lobster for their meals. Many a year ago I needed assistance I was dogged so much I for one was glad to be off of it. Also they talk about heavy set people, well take a look at the ones that are heavy,, people setting back and waiting for their next check to come in. They live good and what crackes me up even more they all have the best and newest cars around. I think welfare really needs to be reformed, and I’m sure it would save that state millions of dollars.

  2. Mike says:

    Dont forget about their weekly trip to rent-a-center to pay the payment on their 52″ flat panel and HD cable bill

  3. DB of Joppa says:

    Elaine, you hit the nail on the head!! Just once I’d like the agency reps to take a cruise through Edgewood, MD or Ghettowood as it has come to be known. nearly all of the housing to the rear of the old Giant store is now section 8. Count the number of Lexus, BMWs, Cadillacs, Acuras, Infinity, and any other high end auto you can think of. They work the system to death, dollar to a dounut, none of the cars are registered in their names, always a relative or a boyfriend benefitting from the welfare system in the way of free housing & food ment to support the Mom & her six kids.

    Those of us working ourselves ragged to provide for our families current and future needs are just about fed up with our tax dollars being dolled out to all the free-loaders!

    You spoke of the “heavy” freeloaders…I say we sponsor the new “welfare diet”…lets try hiding the monthly welfare check under a pair of work boots and we’ll see how quickly they slim down!

    1. carl ginneman says:

      Amen on that!

  4. Terry says:

    Maybe he should call Bob Ehrlich!

    1. Bob Ehrlich says:

      So I can double our tolls again? So I can raise tuition again?

      1. DB of Joppa says:

        Is that all you’ve got? Tolls & tuition?

        There isn’t a single toll road that cannot be by-passed.

        If you cannot afford to put your kid through college, well I suggest you teach him the fine art of using a shovel or flipping burgers at McDonalds. You know, those very jobs only the illegals seem to want because your internet generation off-spring wouldn’t know a hard days work if it bit them in the arse.

        Quit your belly aching and go clean your kids room for him/her.

  5. MDD says:

    Increase taxes in Balto. City, P.G, and Montgomery Counties. They carried your a$$ last November. Let them bail you out!!!

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