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Hogan budget calls for slight spending increase, pandemic aid, tax relief

A copy of the highlights of governor's proposed 2022 fiscal year budget held by Budget Secretary David Brinkley at Tuesday's briefing. (The Daily Record/Bryan P. Sears)

A copy of the highlights of Gov. Larry Hogan’s proposed 2022 fiscal year budget held by Budget Secretary David Brinkley at Tuesday’s briefing. (The Daily Record/Bryan P. Sears)

ANNAPOLIS — Gov. Larry Hogan Wednesday will introduce a general fund budget for the coming year that contains only a modest increase of roughly 1.4% compared to the current year.

Hogan, in briefing with reporters, said the spending plan will provide $1 billion in pandemic relief and $1 billion in tax cuts for retirees and record spending for school construction. Absent from the briefing were details of how he has managed to do those things in a pandemic while also providing the mandated spending increases Hogan has complained about bitterly in the past.

“It wasn’t magic, it was just all of the things that I laid out,” said Hogan. “So the revenues are coming in at a better rate. We took some pretty serious cuts in March and April and July and we received some federal funding help in a number of different tranches that came in with the CARES Act and Paycheck Protection Program. So it was a lot of hard work, a lot of belt tightening and a little bit of luck. Maybe some magic.”

The fiscal 2022 proposed budget will be delivered to the House and Senate tomorrow.

“We look forward to reviewing the details, but the governor’s high-level overview sounds promising,” said Senate President Bill Ferguson, who was briefed on the budget along with House Speaker Adrienne Jones. “We will continue our unified, bipartisan focus on getting targeted resources to the most vulnerable Marylanders for this once-in-100-year pandemic.”

Most lawmakers will also receive a briefing from Hogan, though not the traditional spending discussion over eggs and bacon at the governor’s mansion.

And while the news from Hogan presented a rosy picture, it failed to provide insight on how Hogan would balance his budget. In recent years he has railed against mandates that he has repeatedly said eat up nearly 80% of the budget.

Hogan also declined to provide information on the top-line spending numbers for the general fund budget — which comes directly from Maryland tax payers — and the total budge, which includes all grants and federal aid. Both numbers are typically used as indicators of the rate of growth of the spending plan.

“I think you’re going to find out tomorrow when we submit the budget,” said Hogan when a reporter asked for the information.

When asked why those numbers couldn’t be released now, the governor responded: “Because it wasn’t part of my presentation.”

The line drew laughs and snickers from aides to the governor including Budget Secretary David Brinkley, who stood socially distanced behind Hogan holding a copy of the budget tabbed with sticky notes. On one of those, the was written the amount of the general and total fund budgets: $20.063 billion and $49.386 billion respectively.

The amounts represent a roughly 1.4% increase in the general fund spending plan and a 5% increase in the overall proposed budget.

Contained in Hogan’s proposal are additional funds for education —$213 million over a formula-required amount — as well as money for expanded pre-kindergarten classes and tutoring. Some of the items sound similar to the Kirwan plan vetoed last spring by Hogan.

“I would prefer they just say ‘this is fantastic how fast can we get it passed?'” said Hogan, speaking of how he hoped the General Assembly would receive his spending proposal.

Hogan will likely find that Democratic-controlled legislature has slightly differing priorities. While they agree, in principal, on the need for pandemic relief, the legislative plan is expected to be more targeted and include rental and utility relief.

The legislature is also expected to override his veto of the Kirwan plan as well as a tax package that includes levies on digital downloads, online advertising and tobacco.

Hogan acknowledged that some of his proposals might sound similar to the vetoed Kirwan plan. Democrats say the first few years — until Hogan leaves office — are paid for and likely won’t require tax hikes. Hogan said the plan will ultimately require massive increases.

“We’ve had this disagreement,” said Hogan. “We still don’t agree with $4 billion more per year and massive tax hikes …”

 

 


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