What a difference a year makes. At this time last year the Maryland legislature was entering one of its most difficult sessions. Plagued by state budget deficits, dwindling federal assistance and program competition for limited funds, the general assembly spent 90 challenging days trying to meet the demands of its constituents while also balancing the budget. We made it, but it wasn't easy.
This year the picture looks brighter. Thanks to wise budget decisions made during the 1984 session, the budget out of this session should be healthy. With a reasonable growth in state spending targeted at 8 percent, we should be able to finance some new programs without any increase in taxes and to maintain the state's coveted triple A bond rating.
Yet all the forecasts for Maryland are not positive. While our financial picture is rosier than it was last year, we must proceed cautiously. Current indications are that the White House may play target practice with the states. If Maryland becomes burdened by federal aid reductions and harmful federal tax policy changes, we may find ourselves in a precarious financial position next fall. Once again, states may be penalized for their fiscal prudence. And many economists are forecasting another recession in 1986 that could produce fiscal havoc for state and local governments.
So the legislature will begin its session on Wednesday more optimistically than last year, but with its vision tempered by an uncertain future.
Perhaps the most difficult and controversial issue will be containing health care costs. Medical costs have clearly gotten out of hand across the country. Nationwide, these costs have skyrocketed from $211 a person in 1965 to $1,459 a person in 1983. In Maryland, hospital costs have increased dramatically. Despite the fact that we have been successful in keeping our rate of increases below that of the country, hospital costs now account for almost half of all personal health expenditures in Maryland.
Our primary goal will be to reduce the costs of health care without reducing access to, or quality of, care. I served last fall on the governor's Commission on Health Care Cost Containment, which has submitted recommendations to help bring medical costs under control. The commission's proposals contained major initiatives, including an immediate moratorium on expansion of all hospitals until October 1985; a revenue cap on hospitals; and decertification of excess hospital beds and services. Marylanders are currently paying for 2,000 to 4,000 excess hospital beds -- an expenditure certainly not in our best interests. By converting these excess beds to less costly facilities, health care costs can be reduced.
The legislaturewill also study the state's higher education programs. Basically, there are three strategies to follow to upgrade higher education. First, the fragmented relationships that exist between Maryland's institutions of higher learning should be improved. Second, more precise fields of concentration need to be established within our public colleges and universities. Last, the level of financing should be elevated.
These moves would also prove beneficial to economic development. A well- educated, highly trained work force is a definite catalyst for business to make Maryland its home. This is why I believe we should continue to support the development of hi-tech centers, especially in the Washington-Baltimore corridor. I am greatly encouraged by the decision to place the new super-computer facility in Prince George's County. This will establish Maryland as a leader in computer technology while increasing opportunities for hi-tech expansion throughout the state.
Maryland has come a long way in its efforts to improve economic development, but we still have a way to go, especially in regions with pockets of high unemployment. Clearly we need to continue pursuing specialized projects for economic expansion, such as the Western Maryland conference center approved by the legislature last year. We also should examine Eastern Shore transportation, especially the repairing and building of bridges, as well as other transportation improvements in various localities. The extension of Metro's Red Line in Montgomery County should alleviate some of the county's traffic problems, but further action may be needed.
If we are truly serious about our commitment to spur economic growth, the legislature should consider dredging the Baltimore Harbor.
Other topics that will spark debate include: proposals to improve prisons, provide assistance to victims of crimes, require seat belts, increase financing for education and preserve farm land.
Working cooperatively, I believe we can meet these challenges.