House Republican Caucus Responds to Governor O’Malley’s Proposed Budget Reductions

Today, House Republican leaders responded to Governor O’Malley announcement of an additional $454 million in budget reductions to the FY 2010 budget. The reductions will affect state agency budgets, aid to local governments, and state employee salaries in the form of mandatory furlough days.

“This is one more example of attempting to address the budget problem through piecemeal solutions and fund shuffling” said Minority Leader Anthony O’Donnell. “Had the administration and the majority leadership in the legislature actually faced the situation head on, and made real, significant cutbacks in spending, Maryland would be in a much better position. Instead, the Governor is continuing to kick the can down the road while refusing to address the fundamental problem”.

Maryland continues to face an ongoing structural budget deficit. In 2007, the special legislative session called to deal with the problem resulted in a tax increase of $1.3 billion. In the following budget year, state government spending was increased by the same amount. The overall state budget has increased every year since Governor O’Malley took office, despite the administration’s assertion that the previous administration was to blame for leaving the problem behind.

“There are some simple, obvious places to look for the true reductions in state spending that we have repeatedly called for” said Minority Leader O’Donnell. “The expansion of Medicaid that took place in the 2007 special session, GCEI funding, the bank error that resulted in an overpayment of $30 million to local boards of education, and an immediate moratorium on the tens of millions of dollars being spent on state land acquisitions. None of these are nickel and dime reductions, they will make a significant impact on the deficit problem. These are few of the many examples, and they are common sense solutions.”

“Comptroller Franchot commented at the start of the meeting that basic financial literacy ought to be a fundamental part of the curriculum in Maryland’s high schools” said Minority Whip Christopher Shank. “Managing a finite amount of resources, saying no to obligations you can’t afford – these are key skills that every responsible citizen should develop. Perhaps we should start the training with the administration and the General Assembly leadership.”