While Maryland legislators struggled to close a $1.6 billion budget shortfall this week, Virginia Gov. Bob McDonnell said Thursday that Virginia would be in the black – again – at the close of the fiscal year on June 30. “We made tough choices, cutting education and health care, and six months later we had a $403 million surplus, we’re going to have another one this year, and I think that’s the formula,” McDonnell said on “Fox and Friends” Thursday.
The state, though, deferred more than $600 million in payments to its retirement system last year to help balance the current two-year budget, leading many to question the merit of the extra cash. Lawmakers did accept McDonnell’s amendment this year to accelerate payments into the system, which faces $17.6 billion in unfunded liabilities.
Maryland, meanwhile, raised a number of fees – as well as its alcohol tax – in tackling a $1.6 billion shortfall during the state’s recently completed legislative session.
State employees will also now have to pay more into Maryland’s depleted pension system while taking cuts to their health benefits. For Virginia workers, an increase in pension contributions was offset by a 5 percent pay raise.
