Maryland Gov. Larry Hogan (R) has proposed cutting $67 million from the state’s current budget to reduce spending ahead of expected shortfalls in future years.
State Budget and Management Secretary David R. Brinkley announced the plan Thursday, saying the administration is “trying to get ahead of something we know is coming forward.”
The proposed cuts range from about 0.1 percent to 3.6 percent for each affected agency, including reducing health department spending by $22 million, eliminating 30 positions at public higher education institutions to save $8 million; trimming more than $8 million from the Department of Public Safety and Correctional Services; and reducing by $6 million state grants for low-wealth jurisdictions that struggle to raise revenue through local taxes.
The changes — a tiny fraction of the state’s $43.5 billion budget — require approval by the three-member Maryland Board of Public Works, which includes Hogan, Treasurer Nancy K. Kopp (D) and Comptroller Peter Franchot (D). Franchot often sides with Hogan on matters of fiscal restraint.
The panel is scheduled to consider the proposal on Wednesday.
House Appropriations Committee Chair Maggie L. McIntosh (D-Baltimore City) described Hogan’s proposal as unusual in the absence of any indication that the state will run a deficit for the current fiscal year.
She accused the governor of trying to tweak the budget approved by the General Assembly early this year without input from the legislature. Many Democratic lawmakers prefer addressing projections for future budget years during the next legislative session.
“When you do cuts this way, you whack the oversight that is needed,” McIntosh said. “Our budget process is open and transparent and allows not only affected agencies and institutions to come in but also allows the public to come in and discuss whether recommendations in the governor’s budget are good and should move forward or not.”
Hogan spokesman Doug Mayer countered that there will be a public discussion of the cuts at next week’s Board of Public Works meeting. Such midyear budget adjustments by the board, common in years when revenue was lower than expected, have “enabled countless governors, comptrollers and treasurers to actively manage the state’s finances,” he said.
But the Board of Revenue Estimates has not yet released its September forecast, which will show whether the state is on track to run a deficit this fiscal year.
Regardless of those numbers, Brinkley said, the state needs to prepare for a $750 million shortfall projected for the next fiscal year, which begins in July 2018. He said the administration is using “proactive fiscal management” this time around to chip away at the projected shortfall.
Warren Deschenaux, the legislature’s head of budget analysis, said he could not recall a governor proposing mid-year cuts while not facing a near-term deficit. But he added that “if we’re facing a headwind of that magnitude, I think it’s prudent to take moderate action to build up the state’s fiscal reserves ahead of time.”
Hogan blames mandated spending increases for the state’s chronic projections of budget shortfalls. Since taking office, he has pushed to reduce such required upticks. But the Democratic-majority legislature, has blocked his efforts.
“You can always flash that word ‘mandate’ to make it seem as though the legislature is a body run wild on spending, but the truth is that you can substitute that word with ‘priorities,’ ” McIntosh said. “You need a process that . . . allows the priorities of our constituency to be funded.”