Maryland's General Assembly failed to pass a balanced budget, according to a memo obtained by The Baltimore Sun. Enacting a balanced budget is the legislature's primary constitutional requirement.
"The [fiscal year] 2013 budget is nearly $70 million out of balance," wrote Budget Secretary T. Eloise Foster in a memo to all of Gov. Martin O'Malley's Cabinet secretaries. She recommended that the governor not sign any legislation that reduces revenues "until the imbalance is addressed."
House Speaker Michael E. Busch said Friday that he was aware of the concern but declined to discuss it because he said he has not been fully briefed. Raquel Guillory, a spokeswoman for O'Malley, called the situation "serious" and "somewhat unprecedented."
Warren Deschenaux, the legislature's top fiscal analyst, played down the situation. "Lots of things happen to put a budget out of balance after it is passed," he said. "Bills failing can be one of them. We have mechanisms for dealing with that."
The $35 billion spending plan approved Monday evening by the legislature had never been seriously considered as the final fiscal year 2013 budget. It is a "doomsday" plan that relies entirely on cuts and was designed by Democratic leaders to show their caucus the dire result of failing to pass a tax increase.
However, in a wrinkle that only became widely understood after the General Assembly adjourned, the "doomsday" plan required some additional legislation in order to make cuts. When the General Assembly became gridlocked over a gambling measure and failed to pass a tax plan Monday night, the unbalanced "doomsday" budget became law.
Top leaders in Annapolis have said they want to come back for a special session to solve the problems created by the budget — but as of Friday evening, they hadn't worked out a deal.
Another option for O'Malley is to enact cuts via the Board of Public Works, a three-member panel that he controls. In her memo, Foster recommended that, should the governor choose that option, the board make the cuts by June 1.
In addition to the $70 million in overspending that the legislature approved, the governor would have to cut an additional $80 million because of other provisions in the "doomsday" plan. It calls for agencies to make 8 percent across-the-board reductions and also for the workforce to be reduced by 500.