HB 70 Budget Bill (Fiscal Year 2016) As reported in RSC 5, the Senate overwhelmingly supported the recommendations of its Budget and Taxation Committee and the House concurred with the report submitted to them by their Appropriations Committee.  Despite the fact that the bills adopted in both chambers were remarkably similar, neither chamber would concede to the other chamber’s version, so a conference committee was appointed.

The Conference committee agreed that the Administration’s proposed budget cap on education foundation spending, reducing State employee salaries by 2%, reducing the Geographic Cost of Education Index by 50%, caps on the growth of private and community college formula spending, and a general cap on other State mandated spending, including the Developmental Disabilities Administration was unacceptable, so they found reductions in other places of the budget to fund these priorities.

While, it has been said many times that, according to the Maryland Constitution, the legislature cannot add to the budget, they were able to reject many of the cuts proposed by the Governor, because adopting them would have required them to alter previously adopted legislation through HB 72 Budget Reconciliation and Financing Act of 2015 (BRFA).  Instead of adopting the Governor’s proposed BRFA, they made major amendments to it by proposing different cuts (which they do have the power to do) and then mandating that the savings from those cuts go to the programs that are priorities for them. They stipulated, in the BRFA, that if the savings are not spent on the programs they want them to go to they cannot be spent on anything else.

So, where did the legislature find the money to augment the governor’s proposals?  They cut from the Community College formula, delayed continued phase-in of a change to the Education Aid formula that was previously authorized, reduced aid to local Health Departments, reduced allocations to programs that were over budgeted and level funded a few others for a total savings of $44.8 million.  They also made a number of fund swaps, funding delays and reductions in the Medicaid program, for a savings of $115 million.  They changed the way that the Governor proposed funding pensions, but maintained an extra $75 million payment. They pointed out that even with this reduced payment, the pension fund is projected to reach the 80% funding level by fiscal 2023, which was the original goal established by pension reform legislation adopted in 2011. Other reductions were achieved by elimination of new judicial positions, and reducing other expenses related to the judiciary, increasing the amount of bonding for capital projects and scaling back on the rate of repayment to special funds that have been used for the general fund over the years.  All of these moves 

came to $287.9 million that the legislature could use to fund their priorities.

The table below, from the Conference Committee Report prepared by the Department of Legislative Services, shows the cuts proposed by the governor that were rejected or modified by the legislature, and their priorities for additional funding.

For more detail on the final allocations for education, see the article on education below.

Nancy Soreng