State agencies preparing their upcoming capital budgets are being ordered by the Hogan administration to withhold the release of budget data to legislative analysts through the use of executive privilege.
The change, announced in an email from a top state budget official, comes as the state prepares for a new governor and for new legislative budget powers. Barring legislative analysts from summer capital budget planning meetings upends a decades-old practice and caught lawmakers and their budget experts flat-footed.
Michael Ricci, a Hogan spokesman, downplayed the change and said it was necessary because of new budget powers granted to the General Assembly.
“Aligning the preparation of the (fiscal year) ’24 capital budget with the operating budget reflects our commitment to an orderly transition by ensuring that the incoming administration is able to exercise executive branch discretion over the budget to the fullest degree possible,” Ricci said. “It also takes into account unprecedented changes in the fiscal process, with the General Assembly being able to add funding to the operating budget — some of which could be added PAYGO capital spending.”
Maryland lawmakers and others questioned the change and said it would likely hobble an incoming governor — whom they expect to be a Democrat — and slow the legislative process.
Because of the budget cycle, most of the spending plan will be developed by the current governor. An incoming governor, sworn in after the legislative session begins, has a smaller initial role.
Ricci said ordering agencies to block disclosure of information protects an incoming governor and his team.
“The goal is to ensure they have as much discretion over the budget as possible,” said Ricci. “Letting (the Department of Legislative Services) use the process for its own interests is what would limit the incoming administration — especially now when the General Assembly will be able to add PAYGO capital spending to the operating budget.”
Sen. Nancy King, D-Montgomery and majority leader and member of the Senate Budget and Taxation Committee, called the lockout “petulant.”
“There’s no way a budget put together like that will stand scrutiny,” said King. “Not with a new sheriff in town.”
Maryland’s budget process is about to undergo a sea change with the legislature gaining expanded powers.
Lawmakers questioned Hogan’s “hide the ball” strategy.
“I don’t think, in the long run, this protects any of their budgetary decisions,” said Del. Ben Barnes, D-Anne Arundel and Prince George’s counties and chair of the House Appropriations Committee. “I also think it hamstrings a new administration in their decision-making. To the extent that they want to protect their priorities, an open and transparent process both for the new administration coming in and this legislature is the best way to go about it.”
Barnes called the order “wasted energy.”
Details of a governor’s operating budget have always been closely held until it is sent to the legislature.
But up until now, capital budgets to some degree were a more collaborative and open process, according to analysts and lawmakers. Analysts from the Department of Legislative Services were able to attend and ask questions. The process has meant the legislature has made relatively few changes to those budgets.
“We weren’t aware of the email,” said Vicki Gruber, executive director of the Department of Legislative Services. “Our process for the capital budget hasn’t changed.”
For more than two decades, analysts have attended such meetings. The change before Hogan leaves upends a process that numerous governors have observed and benefited from, including Hogan.
The advent of new budget authority in the coming year means the General Assembly can add to the operating budget, including the portion where cash rather than bonds are used to pay for projects.
“It’s always done this way for the operating budget,” said Ricci. “That’s what I mean by aligning capital budget preparations with operating budget preparations for FY24. It is taking into account the fact that both a transition and changes to the budget process are happening simultaneously.”
This summer, the Department of Budget and Management told legislative analysts they would not be invited to those meetings.
The heads of state agencies and universities were directed to assert executive privilege in an email sent Friday by Teresa Garraty, executive director of the office of capital budgeting at the state Department of Budget and Management.
“As some of you may have noticed during our July FY 2024 Capital Budget meetings, the Department of Legislative Services was not present,” Garraty wrote. “This year we are considering the FY 2024 agency budget requests/CBIS submission as “executive privilege” information, and therefore we will not share request information with DLS”.
Garraty said legislative budget analysts would receive the recommended capital budget in late December or in January.
“I usually know why people get the vapors about these things, but what’s the issue here?” said Ricci. “It is a perfectly reasonable way to address a unique set of circumstances.”