Just 24 hours into the job, Gov. Martin O?Malley has proposed a $30 billion spending plan for fiscal 2008 that grows the state budget by only 2.5 percent, a spending increase lower than those in nine out of the last 10 years.
His proposal uses nearly $1 billion from the rainy day fund to help balance a budget and help fund a $680 million increase in aid to K-12 education, the final year of spending increases mandated by the Thornton “Bridge to Excellence” program.
O?Malley called his budget “fiscally responsible” and “fiscally conservative.” His budget does not fund the geographic cost of education index, as Gov. Robert Ehrlich had also refused to do and for which O?Malley criticized him in last year?s campaign. The GCEI, as it is called, would funnel extra aid to Montgomery and Prince George?s counties and to Baltimore City.
O?Malley promised to work with the General Assembly to phase in GCEI formula next year, making it a mandated part of Thornton aid. The difference between Ehrlich and his own approach, O?Malley said, is that “I fully intend” to do it, and the Republican governor didn?t.
“This was a difficult budget,” O?Malley told reporters in his first news conference as governor. “Next year promises to be even more difficult.”
“There will be a structural deficit” next year, Lt. Gov. Anthony Brown said.
A structural deficit means the state in the long term is spending more money than it is taking in. “We?re aware that structural deficits require structural solutions,” he said.
Maryland?s constitution requires a balanced budget.
“The first thing when you?re facing a hole like that is not to make it deeper,” O?Malley said, and that?s why he kept spending growth low. He expects that implementation of his StateStat programs, modeled on the CitiStat program in Baltimore that tracks government services in great detail, will come up with additional savings. The governor called that “the boring, mundane work of making our government work.”
“Restoring fiscal responsibility to our state will not be easy,” he said. But without efforts to achieve great efficiencies in government, “I don?t feel we can go to the public and ask them to write a bigger check” for state services.
