Maryland lawmakers convene with $3B deficit and uncertainties over incoming Trump administration

ANNAPOLIS, Md. (AP) — Maryland Gov. Wes Moore said Wednesday he will submit a budget plan with about $2 billion in spending reductions to start addressing a deficit of roughly $3 billion, as lawmakers convened for the first day of the state’s 90-day legislative session.

Democrats, who control the General Assembly, say everything’s on the table to address the budget hole, including potential tax increases. Moore, a Democrat, will formally submit his budget plan to the legislature next week, and lawmakers will work for most of the session to approve a balanced budget, which is required under state law.

Moore, speaking to reporters Wednesday afternoon, declined to go into many details about the reductions he’s proposing, deciding to wait until next week when the budget plan is officially unveiled.

“You’re going to see them come from a collection of different areas,” the governor said.

He noted consolidation in information technology, as well as curtailing environmental efforts that he says simply won’t find support in Washington under the incoming administration.

“We have a new incoming federal administration that is not going to support that work,” Moore said. “It’s not going to leverage that capital.”

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Leaders in the General Assembly also warned of the challenging fiscal climate.

“It’s going to be a really hard session,” Senate President Bill Ferguson, a Baltimore Democrat, said in an interview with The Associated Press. “I’ve tried to tell members we have some really difficult choices ahead, but that’s what we were elected to do, and people aren’t going to be thrilled with some of the choices that we have to make, but we’re going to do them thoughtfully.”

Larger costs for Medicaid and a subsidy for the state’s child care program have added significantly to the budget woes, and health care costs in the correctional system also have been significantly higher than anticipated. Last month lawmakers were told the health department underestimated costs for the Developmental Disabilities Administration by about $350 million.

Lawmakers will have the benefit of a large rainy day fund, which has been boosted in recent years to about twice the usual amount. While that will help, legislative leaders say they will weigh a combination of new revenues, efficiencies and budget cuts to bridge the gap.

“Given our budget situation, we’ll be looking at all our options to raise additional revenue,” said House Speaker Adrienne Jones, a Baltimore County Democrat, adding that “we can’t cut our way out of the fiscal situation we are facing.”

Ferguson said the Senate will address the deficit while keeping economic competitiveness in mind, as well as protecting the middle class and low-income families.

“We are extremely mindful of the impact any fiscal policy that we at a state level would have on everyday costs of goods and services here in Maryland,” Ferguson said. “We’re going to try to avoid anything that can bring a major cost to Marylanders on their day-to-day budgets.”

Republicans say they will oppose tax increases and push for greater efficiencies.

“Nobody wants to see their taxes raised, Republicans or Democrats,” said Sen. Steve Hershey, an Eastern Shore Republican who is minority leader. “Everybody thinks that they pay enough in taxes, and you need to see a better, more efficient government, and that’s going to continue to be our message.”

With President-elect Donald Trump’s inauguration set for Jan. 20, Maryland Democrats are concerned about cuts under his administration that could lead to changes in the federal workforce — a backbone of the economy of the state, given its proximity to Washington — as well as cuts in federal grants.

Also on lawmakers’ minds are concerns about the government shifting more Medicaid costs to states, as well as the potential dismantling of the U.S. Education Department.

“My assumption is it’s a real threat,” Ferguson said. “I don’t think it’s absolutely going to be implemented and executed upon in the ways that’s being discussed. But we don’t know until we actually see the efforts to unwind federal departments.”

Jones said Maryland officials are preparing to protect investments in education and health care.

“We’re only beginning to understand what this new Trump presidency will mean for our fiscal outlook, but we’re going to fight to hold the federal government to the financial commitments they made to Maryland, particularly when it comes to transportation and infrastructure projects,” Jones said.

Del. Jason Buckel, a western Maryland Republican and House minority leader, said the anxiety about federal reductions illustrates a longtime over-reliance on federal jobs and spending, highlighting the need to do more to boost the private sector.

“Maryland’s in trouble well before Donald Trump ever gets inaugurated,” Buckel said. “So whatever your feelings about Donald Trump, the man or his campaign, I think we have to understand that we’ve dug our own hole here, and it’s time for us to start trying to climb out of it individually.”