Dear Friends,

Thank you for contacting my office during the 2010 Session of the Maryland General Assembly.  I appreciate the time you took to let me know your views on issues that concerned you.  I have taken these opinions into consideration and used them while deliberating.

This term I again served on the Transportation and the Environmental Subcommittee of the Appropriations Committee.  I continue to serve on the Oversight Committee on Personnel, Oversight Committee on Pensions, Joint Committee for Audits, Joint Committee on Legislative Ethics, and Deputy Whip for the Republican Caucus.  I want to thank all of you for the honor and the pleasure of allowing me to serve the residents of the 42nd District as well as our fellow Marylanders.

The 2010 Session has concluded with challenges still ahead of us.  Over 2800 filed bills were heard in our committees and in the House Chamber.  Due to the financial condition of the state, bills submitted with large fiscal notes were considered but not acted on because of the State’s current budget conditions.  This Session the Appropriations Committee worked on ratifying the four Board of Public Works’ actions taken during this year’s unprecedented downturn in our economy.  The Board of Public Works had cut over $700 million from the State’s $32 billion dollar budget.  Even with the $2 billion dollars in Federal Assistance through the ARRA funds, the Government could not collect enough revenues to keep pace with spending.

SB 140 – The Budget Bill for Fiscal Year 2011
After 11 weeks of extensive debate over the Budget Bill, SB140, 76 committee amendments were adopted, reducing the Governors Budget by $12 Million. Just days after the Budget was presented to the Floor of the House Chamber, the Governor took that $12 million and spent those funds on other programs in a Supplemental Budget.  The Conference Committee Report was submitted two days before the Session ended which increased the Budget by $16 million over what the Governor submitted.  Here in lies the challenge, revenues are projected to be less and our spending continues to climb.  This is the third year that State employees have been furloughed; there were no raises or cost of living adjustments.

New programs were created, projects for construction were supported and five pages of transfers from every account that the Governor could sweep from was swept.  See the “Budget Reconciliation and Financing Act of 2010 (SB 141/HB 151) Budget Summary, Provisions, and Recommendations March 2010,” (http://mlis.state.md.us/2010rs/misc/BRFAof2010.pdf) pages 6, 7, 8, and 9 for all the transfers made to the General Fund.  Some of these transfers are constitutionally questionable, such as the Comptroller’s account that receives local taxes for $350 million and $20 million from an account that the Maryland Automobile Insurance Fund holds in reserves.  It is still unclear if the State will receive the $380 million from the Federal Government.  There lacks any extra cushion, which may result in further action by the Board of Public Works.  The General Assembly must present a balanced budget and understand the financial forecast to prepare for its duty for fiscal responsibility.

The Minority Party offered more than $850 million in suggested cuts with the help of the Department of Legislative Services.  Just a few of these suggestions were implemented, such as reducing the work force by 500 positions.  It sounds harsh until you understand that about 1,000 people a year leave state service through retirements or attrition each year.  Much more could have been accomplished to protect the pressures for increased revenues from our citizens.  Even though this is an election year, it is irresponsible to put off changes that could provide protection from greater fees and taxes.

Capital Budget
The Capital Budget is used to pay for road projects, construction of prisons, state buildings, school construction and land purchases. The State depends on a portion of the property tax to repay the interest and principle on bonds that finance capital projects. The State has reached the debt limit and the capital budget should be adjusted to reflect the current economic conditions. State policy contains provisions that limit the amount of tax supported debt to be no more than 8% of State revenues and 4% of personal income. Over the past 18 months, the State has experienced declining revenues and has increased the debt limit to $1.14 billion in new State debt. I believe it should have been reduced to $990 million, and follow the recommendation that the Capital Debt Affordability Committee suggested in October.  I offered a detailed amendment to reduce the debt outstanding to $990 million, cutting $150 million from projects that have not started and could be postponed for a year. The concern is that the debt service costs could outstrip the current revenue stream, thus relying on General Funds to supplement those payments. Read the rest of this entry »