We?re not in dire straits ? yet. But sales tax and personal income tax revenues are not meeting state budget projections.
Warren Deschenaux, the legislature?s director of policy analysis, told senators earlier this week that he expects state revenues to fall $50 million to $100 million short this year. A planned surplus could absorb the loss.
Anything worse, though, and “we?ll be in a near-calamitous situation,” he said.
Even if slots do pass in November, they cannot help the state this year. Dropping handles at casinos across the country attest to annual slot revenue likely falling far short of the potential $800 million projected by Gov. Martin O?Malley. Don?t bet on a miracle turnaround in the economy.
That means legislators should use their time off wisely and return to session prepared to make specific cuts. Big ones. Like some the Maryland Chamber of Commerce suggested last year. One great idea is to freeze the inflation adjustment for education aid for an estimated savings of $207 million. The state increased aid by billions of dollars in the last five years with little increase in performance, so the teaching establishment has no right to call a freeze a cut.
We?ve suggested a host of other ideas for legislators, including holding errant agencies liable for misappropriated funds, wasted time and criminal behavior. A review of Department of Legislative Services audits reveals millions the state could recover if it turned off the spigot of tax dollars to agencies abusing the trust of Marylanders.
A perfect example is the hours and hours of porn viewed by 22 employees at the state Department of Transportation on our time. Did the state demand those employees refund wasted pay to taxpayers? Did it fire them? They obviously did not have much work if they were able to view adult sites thousands of times per month.
To his credit, O?Malley recently approved trimming $50 million. But a lot of those cuts were for this year ? not structural changes to government operations.
So tote the budget with your sunscreen and beach hat this summer, legislators. You used up your right to use the “fiscal emergency” excuse to raise taxes the last two times around. We need you to start doing the hard work of helping O?Malley permanently reduce spending before we hit that “near-calamitous situation.”
