House Approves $31 Billion Budget Along Party Lines
Republicans Want More Spending Cuts

By John Wagner
Washington Post Staff Writer
Friday, March 21, 2008; B06

The Maryland House of Delegates approved a $31.2 billion budget yesterday, after an at-times heated debate over whether lawmakers were leaving enough reserve funds to weather the effects of a sluggish economy in the coming fiscal year.

The budget bill, which passed 105 to 34, calls for deeper spending reductions than the version that cleared the Senate last week. House Democrats said they are maintaining important investments in education and other programs while setting aside nearly $1 billion in the rainy-day account and other reserve funds.

"This is a very good budget, and we are well-prepared for whatever may come in the future," Del. John L. Bohanan Jr. (D-St. Mary's), a leading member of the Appropriations Committee, told his colleagues during the floor debate.

Republicans questioned whether spending had been reduced enough, pointing to a revised revenue forecast this month that said the state would take in $333 million less than expected during this fiscal year and the one that begins in July.

House Minority Whip Christopher B. Shank (R-Washington) said the state could be forced to make midyear budget adjustments if the economy remains soft and revenue estimates are revised downward again.

"Are we setting ourselves up for drastic cuts? Are we setting ourselves up for even more taxes? I would submit we are," Shank said, alluding to a special session in November in which lawmakers raised taxes by $1.4 billion annually as part of an effort to fix the state's long-term financial situation.

Thirty-four of the chamber's 37 Republicans voted against the budget yesterday. All 102 Democrats who were present voted in favor.

The budget will head to a conference committee, where leaders of the House and Senate must resolve several dozen differences. Lawmakers in both chambers, which are controlled by Democrats, have said the exercise should not prove too difficult.

High-profile differences include spending on stem cell research next year. The House budget provides $15 million for grants to researchers, and the Senate bill offers $5 million. Gov. Martin O'Malley (D) had asked for $23 million.

The House budget also diverts significantly more money from a fund intended to be available for liabilities associated with state retiree benefits.

The greater challenge in the remaining 2 1/2 weeks of the session probably will be to find consensus over how to compensate for a $200 million loss in revenue if lawmakers decide to repeal the state's new computer services tax.

Neither version of the budget accommodates the repeal, although lawmakers could make the necessary adjustments in a separate fiscal bill. Ideas that have been floated to make room for the repeal include a surcharge on the income of millionaires, a diversion of transportation funds and additional budget cuts.

The House budget contains a modest number of initiatives. Delegates set aside $25 million for a new fund to clean up the Chesapeake Bay. O'Malley had sought $50 million for the fund next year. The Senate also agreed to cut the funding in half. The fund was created in the November session.

The House version also includes $15.1 million to expand access to oral health services, $10 million for a small-business health subsidy program created in the special session and $5 million to enhance supervision of high-risk offenders by public safety agencies.

Funding for higher education would increase by 4 percent on a per-student basis next year, and state workers would receive a 2 percent general salary increase.

The sharpest exchange during the debate yesterday occurred once it became clear that significant numbers of Republicans planned to vote against the bill.

House Majority Leader Kumar P. Barve (D-Montgomery) said he wanted to remind Republicans of some of the funding they would be voting against, including "historic" investments in public education. The House version of the bill includes more than $5.3 billion for public education, a 3.5 percent increase over the current fiscal year.

"If you want to walk away from that, be my guest," Barve said. "I'm not going to join you."

Anthony J. O'Donnell (R-Calvert) responded with anger.

"Don't let anybody question your motivation on this floor," he said, adding that Republicans cared just as much about Maryland's citizens. "We're not voting against everything in this budget."

That sentiment was echoed by Del. Richard K. Impallaria (R-Baltimore County).

"It doesn't show in any way, shape or form that we don't care about our constituents," Impallaria said.

Republicans also sought to score points during yesterday's debate by pointing to tax increases passed during the special session. O'Donnell said the budget being debated on the floor was "contingent on massive, historic tax increases."

"We couldn't do this budget without those tax increases," he said.

In arguing for additional spending cuts, O'Donnell also pointed out that O'Malley plans to balance the budget in future years with revenue from slot-machine gambling, which is not a sure thing.

Voters will decide in November whether to legalize slot machines at five locations in Maryland. Legislative analysts project the machines could generate more than $400 million for the state by 2012 and significantly more thereafter.