- The Washington Times - Thursday, October 16, 2008

ANNAPOLIS | Maryland officials Wednesday made $297 million in cuts to the state budget and warned about further reductions if the national economy fails to improve before they hold their next meeting in two months.

“It’s hard to say how much more is to come,” said Gov. Martin O’Malley, a Democrat, who proposed the cuts, then voted in favor of them as part of the state’s three-member Board of Public Works, whose next meeting is in December.

Mr. O’Malley after the vote blamed much of the country’s recent economic problems on “the failed policies of George W. Bush.”

He and board members Treasurer Nancy K. Kopp and Comptroller Peter Franchot unanimously agreed to cut $85 million from health care spending, $16 million from higher education, postpone $20 million in spending for the proposed Intercounty Connector highway in Montgomery and Prince George’s counties, and eliminate 833 vacant jobs across state government.

Mr. O’Malley declined to furlough state workers, as many counties and states facing similar problems have done, but did not rule out the option in the future.

Mr. Franchot, a frequent critic of Mr. O’Malley, said he supported the cuts but wanted to know how the O’Malley administration would handle ongoing problems - using budget estimates from the state’s Department of Budget Management or legislative analysts who have predicted far worse troubles.

He also said the state needs “a comprehensive long-term view of Maryland’s financial books.”

State leaders learned last month they had to plug a $423 million hole in the current budget because of declining sales-tax and income-tax collections. The cuts also are expected to create a $152 million cushion in anticipation of a $1 billion to $1.4 billion shortfall in the next budget.

The cuts also come as neighboring Virginia and the District face a similar financial crisis.

Virginia Gov. Tim Kaine last week ordered the layoffs of 567 employees and asked for permission to dip into the state’s savings account to help close a $2.5 billion budget shortfall but limited cuts to education and the state police.

The moves come amid other budget-paring measures made necessary by falling tax revenues and the financial crisis that further imperils the economy. Mr. Kaine, a Democrat, said Virginia, which operates on a two-year budget cycle, is facing a $973.6 million shortfall for fiscal 2009 and a more than $1.5 billion deficit in 2010, but his cuts aimed to preserve core services in the state’s $77 billion budget.

In the District, Mayor Adrian M. Fenty is proposing cuts for city agencies to close a projected $131 million budget gap.

Mr. O’Malley said he has made roughly $2.2 billion in budget reductions since he took office in January 2007. The governor also said previous cuts and tax increases last year have put the state on a much better financial footing than many other states.

The total amount of the budget cuts including federal and special funds adds up to roughly $348.7 million.

• This article is based in part on wire service reports.

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