Gov. Martin O'Malley greeted mayor-to-be Stephanie C. Rawlings-Blake on Friday, exuding pride that a politician he had mentored had risen to the small circle of Baltimore chief executives.

"Mayor, it is your city," he said to Rawlings-Blake, addressing her by a title she won't assume until Feb. 4. "You've been preparing for this job your whole life."

Rawlings-Blake gamely asked O'Malley, the former mayor, for advice, then embraced Lt. Gov. Anthony G. Brown.

The relationship between the state's chief executive and Baltimore's mayor is critical anytime, but now, as O'Malley is poised to cut hundreds of millions of dollars from the state budget and a new General Assembly session opens next week, the city needs as many friends as it can find in Annapolis, observers say.

O'Malley stands to gain as well from a friendly mayor in the state's largest city as he gears up for a re-election run. Baltimore is a must-win jurisdiction, and it could be helpful to have a city leader who will stand beside him on the campaign trail.

"The state contributes a huge amount to the city," said Donald F. Norris, chairman of the department of public policy at the University of Maryland, Baltimore County. "And a Democratic governor needs the city of Baltimore for votes."

All signs point to a rosy beginning. O'Malley invited Rawlings-Blake to Friday's event, an announcement of the governor's plan for a new, $50 million tax credit geared toward green construction and rehabilitation of historic buildings.

Never mentioned at the event, held at a soon-to-be-renovated mill near Hampden, was Mayor Sheila Dixon, who announced her resignation Wednesday as part of a plea agreement on embezzlement and perjury charges.

O'Malley and Rawlings-Blake noted their history of mutual admiration and support dating to their days of working side by side on the City Council.

The governor recalls showing Rawlings-Blake the ropes at City Hall during her first term. And he credits her with persuading her legendary father, Del. Howard "Pete" Rawlings, to support him when he ran for mayor in 1999.

As mayor, O'Malley appointed her as his floor manager, rounding up council votes for his initiatives.

"So much of life is about relationships, relationship-building," Rawlings-Blake said Friday. With O'Malley, she said, "There's no building that needs to happen. We talk regularly. I know from talking with him that he understands the priorities of the city."

O'Malley returned the praise. "I think you will find her a little more methodical," he said. "I think in terms of style, you will see her not unlike her father, just very steady and methodical."

And that can translate into money for a poor city.

The state's annual cash payment to the city - a "disparity grant" given to poorer communities, is one place an unfriendly governor could cut to shore up the state budget. Another is the city's so-called piggyback tax - the share of the state income taxes that Baltimore can use.

Steve Kearney, a former O'Malley aide who worked in both the city and the state governments, recalled then-Gov. Parris N. Glendening doubling drug treatment funds to Baltimore, a cash infusion the O'Malley administration desperately wanted.

"It was a huge increase," he said.

On the flip side, a bad relationship with the governor can affect "a million different things," Kearney said. "You spend all of your time on unproductive things when your relationship is not good."

The relationship between Rawlings-Blake and O'Malley has been cemented by some crossover of key staff.