ANNAPOLIS — Gov. Robert L. Ehrlich Jr. said yesterday that he was satisfied that General Assembly lawmakers passed many of his key initiatives, though they failed to approve his bills on medical malpractice and witness intimidation reform and one that would have put slot machines at horse tracks and other venues.
“Overall, we do appreciate a lot of the support we have received,” said Mr. Ehrlich, a Republican.
Mr. Ehrlich’s initiative to rehabilitate more prisoners was among his biggest successes.
“If every [bill] was a party-line call, this list would include nothing,” he said.
With three hours remaining in the session, the assembly passed Mr. Ehrlich’s top environmental bill that will impose a $2.50 monthly fee on sewer bills to pay for upgrading sewage treatment plants.
Mr. Ehrlich called the legislation “the most important environmental bill of the last decade.”
Scientists say much of the nitrogen and phosphorus pollution in the Chesapeake Bay comes from inadequate treatment of sewage.
Mr. Ehrlich said he will veto a bill to cap tuition at state schools and a living-wage bill backed by Democrats and would assail House leadership for not being “particularly interested” in moving the slots bill.
He also said more state cuts will be announced as soon as this summer because there will be no slot machine revenue to pay for the $1.3 billion, court-mandated Thornton education initiative.
“We will slow the growth in a number of programs,” said Mr. Ehrlich, who declined to name the programs.
The Democrat-controlled General Assembly waited until the final hours of the session to unanimously approve the administration’s $23.6 billion balanced budget for fiscal 2005.
Also approved yesterday was an administration bill that included minor fee and tax increases to balance the budget.
Mr. Ehrlich vowed that the budget will include money next year to fund the Thornton initiative fully, even after his plan to produce $800 million through slots was killed for a second year in a row.
House Speaker Michael E. Busch, Anne Arundel Democrat, led the House Ways and Means Committee’s 21-0 vote against the bill.
Mr. Busch presented a $670 million package of sales and income tax increases as an alternative to slots. However, the proposal was defeated without coming to a vote in the Senate.
Mr. Ehrlich has said that he would veto any increase in sales or income taxes.
The failure of the tax and slots proposals prompted many Democrats to forecast a doomsday scenario.
“Despite the best efforts of the House, we have failed at putting our fiscal house in order,” said Delegate Norman H. Conway, Wicomico Democrat and chairman of the Appropriations Committee. “Now it’s a problem we will all have to face again next year.”
Sen. Ulysses Currie, Prince George’s Democrat and chairman of the Budget and Taxation Committee, agreed.
“We all know we have a huge [budget] problem on the horizon,” Mr. Currie said.
Although the budget is balanced, with a surplus of about $178 million for the fiscal year that begins July 1, the state will face a deficit of $800 million to $900 million for the following year, which will reach $1 billion without new revenues or big cuts in state spending.
“Ladies and gentlemen, the pain is not going to go away,” Mr. Currie said.
Among other legislation approved yesterday was the Delaware holding company bill introduced by the administration to close a “loophole” that allows corporations to shield some of the income they earn in Maryland from state corporate income taxes by setting up shell corporations in Delaware.
The bill would generate revenue of about $40 million a year. The legislature’s fiscal advisers said the measure could produce as much as $91.5 million for the budget next year depending on how much money the state collects from corporations for taxes owed in previous years.
Mr. Ehrlich has declined to say whether he will sign the bill, which has been changed significantly from his original proposal.
• This article is based in part on wire service reports.
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