The speaker of the House of Delegates is new. So are four committee chairmen in the state Senate. And a Republican is preparing to move into the governor's mansion for the first time since Neil Armstrong set foot on the moon.

When Maryland's annual legislative session commences Wednesday, lawmakers will greet a new lineup of leaders and a shift in power that eventually could pay dividends for the Washington suburbs. But much of the General Assembly's focus this year will be resolving the state's unprecedented fiscal crisis.

Robert L. Ehrlich Jr., the four-term congressman from Baltimore County and the pride of Arbutus, will be sworn in Jan. 15 as the first GOP governor since Spiro "Teddy" Agnew beat a segregationist Democrat in 1966.

And with him comes Lt. Gov.-elect Michael S. Steele, the first African American to win statewide office in Maryland, and a host of new Cabinet appointees.

While Ehrlich will rightly command the public's attention, he'll share the spotlight with an old pal, Del. Michael E. Busch (D-Anne Arundel), who will take charge as the new speaker of the House of Delegates.

Busch and Ehrlich were friends when they served together in the House from 1987 to 1995, even though they belonged to different parties. They could find themselves butting heads more often now.

The Nov. 5 election wreaked unusual havoc with the membership rolls of the General Assembly; one of every three delegates is a freshman, and one-quarter of the Senate is new.

The influx of newcomers is reflected in the exodus of familiar faces. Packing their bags are some State House fixtures whose political careers seemed almost as long as U.S. Sen. Strom Thurmond's.

Sen. Walter M. Baker (D-Cecil), 75, chairman of the Senate Judicial Proceedings Committee, who got his start in politics in 1963, lost his bid for reelection.

So did retiring Sen. Clarence W. Blount (D-Baltimore), 81, the majority leader since Ronald Reagan was president, and a senator for 32 years.

And, most significantly, Del. Casper R. Taylor Jr. (D-Allegany), 68, the longtime speaker of the House who served 28 years as a delegate, lost his bid for an eighth term by fewer than 100 votes.

Also leaving the Annapolis scene is Gov. Parris N. Glendening (D), who began his political career on the Hyattsville City Council in 1973 and never lost a race for office.

While term limits ended Glendening's career, his understudy, Lt. Gov. Kathleen Kennedy Townsend (D), is leaving town because she couldn't win the hearts of voters, failing in her bid to become the first female governor of Maryland.

No matter who remains, the most pressing (and vexing) issue facing the 2003 General Assembly will be money -- or, more accurately, a profound lack of it.

Overspending and an economic downturn have left the state's books $1.7 billion out of kilter, with a $550 million deficit this year and a projected $1.2 billion shortfall for the fiscal year that begins July 1.

Ehrlich has promised not to raise income or sales taxes to wipe out the deficit. He also has vowed not to cut spending for public schools and to avoid layoffs.

The governor-elect says he'll raise $400 million by legalizing slot machines and taxing the winnings and trimming spending in other areas. But he has been vague about how he'll balance all those competing demands, leading some lawmakers to predict that large tax hikes are inevitable.

Comptroller William Donald Schaefer (D), who endorsed Townsend but has cozied up to Ehrlich since the election, said that he fears the incoming governor doesn't realize how difficult it will be to balance the budget. When Schaefer served as governor, he was forced to raise taxes and slash services to erase a $500 million deficit -- the most red ink the state had ever dealt with until now.

"Ehrlich, God, oh what a tough deal," Schaefer winced in a recent interview. "He's got to find ways to stay with what he promised in the campaign. But the first year is going to be murder on him, absolute murder."

Although discussions over the budget will dominate, here's a glance at other key issues that will play out during the General Assembly session:

* Slot machines: Maryland banned slot machines in the 1960s, but they're poised to make a comeback -- thanks to the budget deficit.

Ehrlich has estimated the state eventually could raise $800 million a year by taxing gambling proceeds from slots. He has proposed confining the one-armed bandits to Maryland's four racetracks, partly in an effort to revive the state's moribund horse racing industry and partly in a bid to assuage opponents who fear that legalized gambling will bring in a host of social ills, such as addiction and crime.

Ehrlich and his supporters -- including Senate President Thomas V. Mike Miller Jr. (D-Prince George's) -- have also pledged to use revenue from slots to pay for public education.

It's unclear whether they'll be able to deliver. The deficit has become so deep that lawmakers may decide to use slot money to plug other gaping holes in the budget. And casino owners and other gambling interests are already pushing to allow slots in other corners of the state.

* Guns: During Glendening's administration, Maryland lawmakers passed a series of gun-control laws that rank among the strictest in the nation. Ehrlich questioned some of those laws during the campaign, saying he doubted their effectiveness.

One of the priorities of the Republican governor's legislative agenda is to adopt a version of Project Exile, a joint state-federal program in Virginia under which gun-toting felons are required to serve a minimum of five years in prison.

How Ehrlich's proposals will change things in Maryland is unclear. The state already has strict sentencing laws on the books, with punishments akin to those in Virginia, but they are often ignored or bargained away by prosecutors and judges.

* Death penalty: Glendening approved a moratorium on executions earlier this year to allow time for academic researchers to determine whether there is evidence that Maryland's capital punishment law is biased against African Americans.

Ehrlich said he'll reverse the moratorium soon after he's sworn in and allow executions to resume. Lawmakers who oppose the death penalty argue that he should wait until the study is completed -- it is scheduled for release next month -- and they promise to push bills that would place further restrictions on the ultimate punishment.

Ehrlich has also suggested changing Maryland law to allow for the execution of offenders younger than 18.

* Health care: Maryland's largest health insurer, CareFirst BlueCross BlueShield, has been a not-for-profit company since the Great Depression and has survived thanks to a host of tax breaks and public subsidies. Now company officials want to sell the firm to a for-profit company for $1.3 billion.

The sale could result in a windfall for Maryland and other states in the region, which would receive money to compensate for decades of tax breaks. But the deal is running into political trouble, partly because it would include a payday in bonus and severance packages to a handful of key executives.

Lawmakers are also worried that a for-profit CareFirst would be reluctant to insure the poor. State Insurance Commissioner Steven B. Larsen has already testified that the deal could be illegal. New House Speaker Busch also is opposed.

Slot machines such as these at Charles Town [W. Va.] Races & Slots could help Maryland raise $400 million this year, according to Gov.-elect Robert L. Ehrlich Jr., who wants to legalize them and tax money spent to play them.