Legislators joust over who's to blame for state's budget woes

Maryland's current bond rating cited

Wednesday, Feb. 24, 2010

Members of St. Mary's County's legislative delegation in Annapolis sparred on Monday at a breakfast for local business representatives over who's to blame for the ailing state budget and ways to provide a remedy.

The fiscal debate, which has consumed the early weeks of the 90-day General Assembly session, took center stage at the St. Mary's County Chamber of Commerce annual legislative forum at Lenny's in California.

"Unless we address our budget problems, all of our priorities are at risk," said House Minority Leader Anthony J. O'Donnell (R-Calvert, St. Mary's).

The three Democratic members of the delegation generally concurred with O'Donnell's assessment.

But Del. John Bohanan (D-St. Mary's) offered a different spin.

Nearly every state is grappling with budget problems and Maryland is better off than most, he said. Southern Maryland has been relatively insulated from the worst of the recession because of the strong presence of the federal government and major military installations.

Things would be much worse had the state not made tough decisions to decrease the state workforce, cut agency budgets and limit general fund spending, Bohanan added.

Perhaps the most important indicator, however, is Maryland's continued retention of its prized triple-A bond rating from three top Wall Street agencies, which came on Friday.

"You can listen to the Republicans, you can listen to the Democrats, a lot of rhetoric about who's doing a good job managing the state budget — listen to Wall Street, not exactly a liberal bastion," said Bohanan. "These are folks who come in and look hard at one thing. They look at the numbers, they look at how are you managing the fiscal affairs of your state."

But O'Donnell said the state still faces massive shortfalls in future years once federal stimulus money runs out. And the state's unaddressed pension obligations put the bond rating in jeopardy.

"We've got some big problems that have been papered over for too long," he said.

One way to ease the budget pressures would be eliminating the $15 million lawmakers spend on local bond projects, said Del. John F. Wood Jr. (D-St. Mary's). Although the funds are usually put toward worthwhile initiatives, it's something that should be cut when money is tight.

"A lot of people think they can't get elected without them," he said.

The budget woes largely stem from passage of the landmark Thornton education funding plan in 2002 without a way to pay for it, said Sen. Roy Dyson (D-St. Mary's, Calvert, Charles). It's not politically palatable to cut school aid in a year when statewide officials and all 188 lawmakers are up for re-election.

A package of tax hikes passed during a special legislative session in 2007 did not help matters much.

Bohanan faulted the economic downturn. O'Donnell said it's because revenues were spent on Medicaid expansion and Chesapeake Bay restoration, rather than the long-term imbalance between state revenues and expenditures.

Although Democratic leaders have ruled out tax increases to balance the budget this year, O'Donnell warned it's unavoidable next year, conveniently after the election.

"When elected officials say it's an election year so we're not going to raise your taxes, hold on to your wallet," he said.

abrody@somdnews.com