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Md. board approves budget cuts, but less than Hogan proposed

Governor Larry Hogan speaks at a Board of Public Works meeting. (File)

Governor Larry Hogan speaks at a Board of Public Works meeting. (File)

ANNAPOLIS — The Board of Public Works approved a modified plan to reduce the current budget.

The three-member panel unanimously approved nearly $63 million of $79.9 million in planned cuts, roughly $7 million less than proposed by Gov. Larry Hogan nearly a week ago. The balance, which include funds transfers, will likely need legislative approval in the coming legislative session.

Disparity grants to local governments totaling more than $6 million make up the bulk of the proposed cuts withdrawn from the original proposal. The money, which can be used for a variety of programs, is typically used for education. Baltimore City and Prince George’s County are some of the larger recipients of the grants.

The balance of the restored funding will go to Humanities Council and within the Department of Planning in the amounts of $150,000 and $200,000, respectively.

State Budget Secretary David R. Brinkley said the midyear cuts were needed to prepare for the next budget. He fired back at Democratic lawmakers, including Del. Maggie McIntosh, who last week said the moves were unnecessary and circumvented the state budget process.

“Although some have claimed there is a lack of an immediate fiscal crisis facing Maryland, the reality is that such attitudes and beliefs betray a fundamental misunderstanding not only of sound budgeting principles but of the serious challenges this state faces in the next few years based on its current spending patterns,” Brinkley said.

State spending is projected to grow next year by a rate of more than 5 percent. Revenues will fall short of that, growing at more than 3 percent. The result is an expected gap of about $750 million that will need to be addressed by Hogan in his next budget that will be released in January.

McIntosh, a Baltimore City Democrat and chair of the House Appropriations Committee, said last week that the cuts in the absence of a fiscal crisis or the lack of an expected decrease in revenues were unnecessary. She called on Hogan to wait until January to make cuts when the legislature was back in session.

Hogan, a Republican, chairs the board. Comptroller Peter V.R. Franchot and Treasurer Nancy K. Kopp, both Democrats, are also board members.

Kopp, who represents the legislature on the panel, said eliminating proposed cuts that would have affected education funding “represents a better understanding of the impacts” in the original proposal.

Franchot also praised the actions, saying it provided a measure of protection against an uncertain time in Washington and potential federal budget actions that could have a negative effect on Maryland.

“Having a cautious and conservative approach to the fiscal matters of the state is a line of defense for our taxpayers and our families,” Franchot said.

The cuts, coming in the middle of the budget year, are meant to provide a down payment toward an expected $750 million gap between expected spending and revenues in the fiscal 2019 budget, said Brinkley.

Few details were provided as to why some of the cuts were rescinded.

The Maryland Association of Counties, which represents all 24 major jurisdictions, wrote to all three members of the Board of Public Works urging them to reject the proposed cuts to the disparity grant program.

“While counties are willing to shoulder their fair share of cuts necessary for ensuring the structural soundness of the State’s budget, this particular cut, when considered along with restrictions placed upon these funds by the Maryland General Assembly during the 2017 legislative session, amounts to an unfair consequence for county governments who dutifully complied with the state direction for these funds,” wrote Michael Sanderson, executive director of the association.

Sanderson, in his letter, said the cuts aren’t justified because there is no immediate fiscal crisis.

“The state obliged counties receiving a disparity grant increase to direct these funds to education,” wrote Sanderson. “The counties did so. To now rescind that very funding unfairly penalizes other county-funded priorities.”

In a statement, Sean Johnson, legislative director for the Maryland State Education Association, called on Hogan to stop “playing games” with education funding.

“After cutting funding for public schools every year he’s been in office, hopefully this is a sign that Governor Hogan is finally turning over a new leaf,” Johnson said. “With Maryland’s public schools underfunded by $3 billion annually according to a recent report, now is the time to stop playing games with school funding and start making real progress in getting our students what they need to be successful.”

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