- The Washington Times - Tuesday, March 22, 2011

ANNAPOLIS | The House of Delegates on Wednesday will be the first chamber to begin full debate on the state’s fiscal 2012 budget, which includes several fee increases to close an estimated $2 billion budget shortfall.

The budget, approved last week by the House Appropriations Committee, includes several changes to the one submitted in January by Maryland Gov. Martin O'Malley, a Democrat.

Democratic leaders largely reversed the $94 million in cuts to public education proposed by Mr. O'Malley by making other cuts and doubling fees for property-tax records, vehicle titles and vanity licenses plates, which are expected to generate nearly $70 million in additional revenues.

They also altered Mr. O'Malley’s plan to fund Maryland’s cash-strapped pension system by making state employees pay 2 percentage points more from their salaries, rising from 5 percent to 7 percent, which was only an option in the governor’s plan, and pushing $17 million in administrative costs onto counties.

The House is expected to vote Thursday or Friday. The proposal would then go to the Senate Budget and Taxation Committee before heading to the Senate floor.

Though House leaders don’t expect amendments for new taxes or fees, Senate leaders are still considering several new tax proposals, most notably an alcohol excise tax, which is expected to pass.

The revised House budget includes a $122 million fund balance and would cut the state’s $2 billion structural deficit by more than 40 percent, compared with the 33.3 percent reduction suggested by the state’s Spending Affordability Committee.

“I think we’ve done a good job,” said Delegate Norman H. Conway, Wicomico Democrat and chairman of the House Appropriations Committee. “You can talk about taking all the deficit at one time, but when you get into it, nobody can do that. You need to work on it in a planned approach.”

House Republicans say the budget doesn’t go far enough to address the state’s financial woes.

Minority Leader Anthony J. O’Donnell, Calvert Republican, said legislators should cut more spending to reduce the shortfall and that they are ignoring potential federal cuts that could put the state in a worse position.

“They did very little,” he said, adding that this year’s budget is about $1 billion more than last year’s. “We’re still going to have a $1.2 billion deficit coming into next year. … It’s a horrible continuation of kicking the can down the road.”

The Senate proposal to increase the alcohol tax by 1 percentage point in each of the next three years was introduced Monday by Sen. Verna Jones-Rodwell, Baltimore Democrat. The increase — from 6 percent to 9 percent — is expected to generate about $90 million in revenue.

The Senate Budget and Taxation Committee is scheduled to hear the proposal Wednesday.

“It’s a modest step, and it will help us with important state issues,” said Senate President Thomas V. Mike Miller Jr., Prince George’s Democrat.