Supplemental Budget Falls Short

April 3, 2015 by Kathleen Algire-Fedarcyk in Blog

The supplemental budget Governor Hogan released yesterday falls short of what Marylanders deserve in the quest for a strong economy and broad prosperity.

The Governor’s proposals would undo the General Assembly’s efforts to restore unwise cuts in spending on schools, public employees, and other necessary services.

Both the House and the Senate approved state budgets for the coming fiscal year that removed  cuts to education formulas made by the Governor and restored the 2 percent cost-of-living pay increases he took out. The General Assembly realized the value in having a highly educated workforce for growing and attracting new business and the life-long impact education has on a person’s ability to earn and support themselves and their family.

On the other hand, the Governor’s supplemental budget focuses more on reducing revenue – which would lessen the state’s ability to invest in job growth and support the middle class, while giving the biggest breaks to the wealthiest Marylanders. Governor Hogan proposes reimbursing small business for the personal property tax, which would put at most $562 back in the pockets of the business but would cost the state millions in revenue, and reimbursing businesses for financial contributions made to nonpublic schools, again costing the state millions and doing nothing for the public schools who just lost funding. The Governor also added $8 million to the budget to hire 100 additional State Police and reopen the police barracks in Annapolis, even though a 2008 study found that consolidating the Annapolis barracks with the Glen Burnie barracks saved money and was more efficient.

Options are plentiful this legislative session to help Maryland responsibly meet its needs.  The Fair Tax Package, for example, (SB 179/HB 663, SB 389/HB 240 and SB 661/HB 730) would close corporate tax loopholes, freeze the estate tax which benefits a handful of wealthy Marylanders and increase the top bracket of the state income tax so the wealthiest Marylanders (those making over $250,000 a year) would pay more of their fair share.

Cuts in support for services that grow the economy and tax breaks that mostly benefit the rich and large corporations are not the way to promote broad prosperity in Maryland. Other states that have tried those policies are faring poorly.

A better path for Maryland’s future is to stop taxing those that earn the least at a higher rate than those who earn the most. We need to support a prosperous middle class, so families can make ends meet and save for their future.

Both the House and Senate will have to reconcile their budgets with the supplemental budget. A committee of delegates and senators have until Monday for final budget approval.