Spending proposal closes half billion dollar shortfall with no new taxes or fee increases; continues strategic investments in education, health, public safety and sustainability
ANNAPOLIS, MD (January 15, 2014) – Governor Martin O’Malley and Lt. Governor Anthony Brown today released the FY 15 budget, a fiscally-responsible, jobs-focused spending plan for Maryland. Click here for the complete set of budget documents.
The Administration’s balanced budget proposal:
cuts $457 million this year, bringing total cuts to $9.1 billion since 2007;
closes the projected $584 million revenue shortfall with no tax increases or fee increases;
makes more progress towards eliminating the $1.7 billion structural deficit that Gov. O’Malley inherited in 2007, and puts Maryland on track to totally eliminate that structural deficit by 2017; and,
ensures there is $800 million in the Rainy Day Fund (5% of the General Fund balance), and leaves a $37 million fund balance.
These actions secure Maryland’s status as one of only 7 states that maintained a AAA bond rating from all three ratings agencies during the global recession.
“This jobs budget puts us on the path to eliminating our inherited structural deficit by 2017, with no tax or fee increases, ” said Governor O’Malley. “This fiscally-responsible budget builds on the tremendous progress we’ve made as a State, strengthening our economy by supporting 48,000 jobs, protecting our #1 in the nation schools with record investments in education, and upgrading our transportation infrastructure with modern investments.”
“Over the past eight years, Maryland has made great strides in building a stronger economy, creating jobs and growing the middle-class,” said Lt. Governor Anthony G. Brown. “This budget makes the right choices by investing in our schools, including expanding pre-k, improving public safety and continuing our work to expand access to quality health care for all Marylanders while maintaining fiscal responsibility.”
A Fiscally-Responsible Approach:
The proposal, as submitted, successfully eliminates the projected $584 million decline in revenues in the FY14 and FY15 budgets. Budget balancing actions in the FY 15 budget amount to $621 million, with $457 million in spending reductions and no taxes or fee increases. Almost three quarters (74 percent) of the solution to the budget gap is cuts to planned spending. The budget proposed today secures cash reserves for the State with a $37 million general fund balance and another $800 million in the State’s Rainy Day Fund.
The proposed budget brings total cuts to State spending to $9.1 billion dollars since 2007. Additionally, budget growth is held to the lowest levels in a generation, and the size of the executive branch is reduced to 1973 levels. In fact, this is the 8th consecutive budget submitted in compliance with Spending Affordability Guidelines set by the Maryland General Assembly.
Jobs-Focused, Modern Investment:
The Administration balanced spending cuts in the FY15 budget with strategic investments in education, infrastructure, and innovation, creating jobs and positioning Maryland to compete and win in the 21st century global economy.
Maryland is among 17 states to recover more than 100 percent of the jobs lost during the recession with over 34,000 jobs created in 2013. And while there are significant spending limits, this is a jobs budget – accelerating investments in innovation sectors like clean tech, green tech, biotech and life sciences, cyber and basic R&D. This budget supports 48,000 new jobs to modernize infrastructure by replacing and repairing aging schools, roads, bridges, and highways.
Our Shared Priorities:
By taking a balanced approach to fiscal responsibility, the O’Malley-Brown Administration has made better choices to protect our shared priorities of stronger schools, quality affordable health care for more Marylanders, safe neighborhoods and communities for Maryland families and a cleaner, more sustainable environmental future for Maryland:
Investing in Education
The FY 15 budget builds on Maryland’s #1 school ranking and paves the way to global competitiveness for our children. Funding for public school construction totals $286 million, bringing the O’Malley-Brown Administration average annual investment to the highest ever at $345 million.
The FY 15 budget also includes $4.3 million in new funding to expand pre-kindergarten opportunities for Maryland children, bringing total funding for public schools to a record $6.1 billion (an increase of 37% as compared to FY07).
Since 2007, Maryland has done more than any other state in the nation to hold down the cost of college. This year will continue that trend with a 6.4% increase in funding for the university system, and a cap on the University System of Maryland’s tuition increase at 3%, including a freeze at Morgan State University and St. Mary’s College. Gov. O’Malley is also investing $297.5 million in community colleges (including a 4.9% increase in direct aid).
Commitment to the Public’s Safety
Investments in security enhancements; upgraded camera and video recording equipment; and K-9 units for contraband at correctional facilities.
Record police aid for local jurisdictions.
Implementation of modernization plans for the State Police vehicle fleet.
Sustainability
Record funding for the Bay 2010 Trust Fund non-point source projects, and an additional $25 million in capital funding for Trust Fund projects addressing stormwater events.
Fully funding the cover crop program and an additional $ 9.1 million for oyster restoration; and,
Over $100 million in enhancements to wastewater treatment plants.
Health Families, Stronger Communities
FY15 budget provides insurance for more than one million people, expanding access to more than 500,000 more Marylanders since 2007.
Investments to support more than 700 placements for developmentally disabled individuals; and,
Highest level of funding during the O’Malley Brown Administration for cancer-research through Academic Health Centers.
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