- The Washington Times - Saturday, March 15, 2008

ANNAPOLIS (AP) — Maryland’s Senate gave final approval yesterday to a state budget with roughly $390 million in cuts and spending transfers, and the House approved cuts to its budget measure with an eye toward leaving a bigger budget balance in case the economy worsens.

The Senate passed its budget bill 38-7 with little discussion, which frustrated Republicans. Minority Leader David R. Brinkley said he was worried that difficult fiscal times ahead may require more cuts later.

“Have we gone far enough? I don’t think so,” said Mr. Brinkley, Frederick Republican, who voted for the bill even though he thought more should have been done to rein in spending.

The Senate bill cuts about $226 million from the state’s general fund, which is composed mostly of income and sales taxes, and about half of the state’s expenditures are made from it. The measure makes up for about $315 million of the $333 million budget write-down last week in projected revenue estimates.

The budget approved by the Senate would leave a balance of about $158 million, which would be in addition to about $739 million projected for the state’s Rainy Day Fund. That would leave a total reserve of nearly $900 million for the state to draw from, if the economic downturn continues.

The House was aiming toward deeper cuts in order to create a bigger general fund balance than in the Senate’s bill, to better brace for another revenue write-down. The House is looking to have a $248 million balance, which would leave nearly a $1 billion cushion when the Rainy Day Fund is added into the mix.

Like the Senate, the House is moving ahead with plans to reduce a planned $50 million fund for the Chesapeake Bay by half. However, the House is limiting the $25 million reduction to fiscal 2009, while the Senate proposed the reduction into fiscal 2010.

The House also voted yesterday for about $6.8 million in cuts to the University System of Maryland, just as the Senate did.

A difference between the two chambers arose over stem-cell funding. The Senate voted to cut stem-cell funding by $18 million from the $23 million in the budget proposed by Gov. Martin O’Malley, a Democrat. The House Appropriations Committee voted to cut it by $8 million.

The House also differed from the Senate on plans to adjust an extension of Medicaid to residents without health insurance, a plan approved in November’s special session. The Senate measure delays expanding Medicaid to parents by six months — until Jan. 1 — while the House is moving ahead with starting it on schedule.

The House committee also voted to reduce the amount of money set aside to subsidize small businesses to extend health insurance. There was $30 million in the governor’s budget for the subsidy, and the Senate cut it to $15 million. The House wants to cut it to $10 million in the first year.

In another difference, the committee also voted to save $100 million in general funds by transferring payments for Other Post Employment Benefits, which are a part of the compensation package employees earn each year. The Senate voted to transfer about $50 million for OPEB.

Kristen Wyatt contributed to this report.

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