O'Malley Rolls Out Cuts in Spending

$153 Million Plan Does Not Satisfy Unions or GOP

Gov. Martin O'Malley presents proposed budget cuts at a news conference in Annapolis. "We believe we have come up with responsible cuts," he said. (By Kevin Clark -- The Washington Post)

A proposed $153 million in spending cuts formally unveiled yesterday by Maryland Gov. Martin O'Malley drew barbs both from a state employees union, which said the reductions went too far, and from Republican lawmakers, who said they did not go far enough.

The cuts, which the Democratic governor plans to present for approval today to the state Board of Public Works, are spread among about 40 state agencies and would be achieved largely by holding open vacant positions, delaying some initiatives and adjusting caseload projections for health and social services programs.

The proposed cuts are an early step in addressing a projected budget shortfall next year of nearly $1.5 billion that lawmakers say will almost certainly require tax increases to close.

"We believe we have come up with responsible cuts," O'Malley said at a morning news conference. "This is one step among many. . . . These are real savings . . . but we're by no means done."

The $153 million in cuts represent about 1 percent of Maryland's general fund budget of nearly $15 billion for the fiscal year that started July 1. In addition, O'Malley said $60 million in unspent money from the previous year's budget could be used to address the looming deficit. Of that, however, $34 million had been previously accounted for in the state budget.

As a result of the cuts, 147 state government positions would be eliminated, only 17 of which are filled with "real, live human beings," O'Malley said.

One of O'Malley's two colleagues on the Board of Public Works, State Treasurer Nancy K. Kopp (D), said she anticipated voting for the cuts today; a spokesman for Comptroller Peter Franchot (D) said he was reviewing the list.

"They're not large, programmatic changes," Kopp said. "The governor is tightening up a number of agencies."

But representatives of the state's largest employees union -- which strongly backed O'Malley in last year's election -- argued otherwise at a news conference soon after the governor finished speaking.

The cuts, for example, include a $1.5 million reduction in the budget of the Maryland State Police, which officials said could be achieved by holding positions vacant longer and reducing spending on travel, equipment and gas. The cut represents less than 1 percent of the agency budget.

Pete Peterson, a pilot with the state police, suggested the cuts could hamper the efforts of an already overworked 40-person crew.

"This small but highly skilled force is dwindling through attrition to the point where the state's medevac function is stretched to the limit," Peterson said at the event, organized by the Maryland chapter of the American Federation of State, County and Municipal Employees.

Flo Jones, a foster care worker in Baltimore, questioned a $2 million statewide cut to that program. Administration officials said the cut is possible because of a decline in the projected caseload.

But Jones said caseworkers are overburdened caring for vulnerable children. "These are lives, hanging in the balance, and we definitely need more staff and resources, not less," she said.

Republicans, meanwhile, said that O'Malley had not cut enough and that he and other Democrats seem likely to turn to tax increases to close most of the shortfall.

"I think it's a step, but it's only a baby step," House Minority Leader Anthony J. O'Donnell (R-Calvert) said of the budget reductions. The agency that would take the largest cut is the Department of Health and Mental Hygiene, which stands to lose nearly $47 million this year. But Health Secretary John M. Colmers said it is important to keep in mind that his department's overall budget is close to $7.5 billion. He described the cuts to his department as "everybody gets a haircut."

The largest single reduction, $17.2 million, would be achieved by maintaining a limit on the number of days of a hospital stay covered by Medicaid, the state-federal health insurance program for the needy. Those limits, already in place, were planned to be lifted midway through the year.

The University System of Maryland would absorb another of the larger cuts, a reduction of about $12 million, or 1 percent, O'Malley aides said. The system had been asked to give up $20 million but vigorously protested.