Gov. Martin O'Malley (D) has had a rough go of it, budget-wise, during his ongoing four-year term. Maryland's economy, like the nation's, was jolted by a crisis on a scale unseen in generations. As a result, the state's revenue growth ground almost to a halt, increasing only 1.4 percent between fiscal years 2007 and 2011. The state's proposed operating budget—the normally ever-growing pot of money that funds day-to-day government activities—actually shrank this year, while the number of state employees declined for the second year in a row.

By comparison, former governor Robert Ehrlich (R) had a cakewalk. After his election in 2002, the economy shook the doldrums and started booming. Personal income in Maryland jumped skyward, helping fuel a nearly 40-percent increase in state revenues between fiscal years 2003 and 2007. Much of the money boosted the government's operating budget, which rose nearly 28 percent during those four years. After initially cutting the number of state jobs by eliminating vacant positions, Ehrlich increased them again until, in his final budget, the number was greater than under his predecessor, Parris Glendening (D).

The two governors, who are running against one another for the second time, handled two vastly different sets of budgetary circumstances. But analyzing how they handled them, by comparing the way they divvied up the budget that funds government operations, reveals much about their priorities. While the campaign rhetoric whips to a frenzy in the weeks leading up to the Nov. 2 general election, there's one foolproof way to gauge how the candidates governed: Follow the money.

City Paper relied on state budget documents to analyze two operating budgets for each governor: the one his predecessor handed him, and the final one of his term. In any given year, the size of a given slice—the environment, for instance, or health—is measured by dividing the amount it received into the total budget. Determining how much that slice grew or shrank over each four-year period is then a matter of comparing its size in the first year to its size in the final year.

For each governor, City Paper identified the three slices that grew the most and the three that shrank the most. Ehrlich's most-favored slices were the environment, education, and health, while his hardest-hit slices were transportation, human resources (the "safety net" for Marylanders in crisis), and business-related agencies. Under O'Malley, health, education, and human resources grew the most, while the environment, transportation, and business-related agencies shrank the most.

Thus, the two governors shared much in common: They both favored education and health and they both de-emphasized transportation and the state's business-related operations. Where they differed was on the environment, which Ehrlich boosted the most and O'Malley hit hardest, and human resources, which O'Malley favored and Ehrlich cut.

Ehrlich campaign spokesperson Andy Barth writes in an e-mail response to City Paper 's findings that Ehrlich "has always been totally committed to providing quality education for all our children," so he "provided the biggest funding increase for K-12 education of any governor ever, $1.4 billion." While governor, Barth writes, Ehrlich "also provided historic improvements for the Bay and Maryland's environment" by taking measures that Barth credits for producing "a substantial increase in the crab population and harvest in the Bay." Barth adds that, while Ehrlich "worked hard to keep spending in check for all agencies, including business related activities," the former governor claims to have run "the most productive and cost-effective" business-related operations "in Maryland's history, and will fund those programs that produce the best return on investment."

"Under Governor O'Malley, we have made the tough but smart decisions to invest in the most critical priorities for our families, education, public safety and job creation, while at the same time restoring fiscal responsibility in Annapolis," O'Malley spokesperson Rick Abbruzzese writes in an e-mail response. "Governor O'Malley has cut $5.6 billion in state spending. He abolished 4,200 state positions, and today, Maryland's General Fund is smaller than it was four years ago (for the first time since the Great Depression), and we have the lowest number of state employees per capita since 1974." He says the governor addressed the $1.7 billion "structural deficit" and reduced general fund spending overall by 3 percent while submitting balanced budgets. "While making these tough and fiscally responsible decisions, we have also moved our state forward with record investments in public education and school construction, made college more affordable at Maryland universities, . . . [and] provided health care for more than 200,000 more Marylanders."

What follows is a closer examination of each governor's most-favored and hardest-hit budget slices.

Ehrlich Winners

The Environment

Budget share: up 1.2 percent, to 3.2 percent


State spending by three agencies with environmental missions—the Departments of Agriculture (MDA), the Environment (MDE), and Natural Resources (DNR) —more than doubled under Ehrlich, from $466.5 million in 2003 to $982.2 million in 2007, while the number of jobs in these agencies declined 4.4 percent to 3,202.

The biggest winner was DNR’s Capital Grants and Loan Administration, which saw its budget increase six-fold, from $54.8 to $329.2 million. The program handles grants for land conservation and recreation. Also doing well was MDE’s Office of the Secretary, where spending nearly tripled from $61.3 to $181.7 million. In addition to overseeing agency operations, the secretary’s office manages capital appropriations for protecting environmental quality. MDA’s Office of the Secretary, which directs the agency’s mission to support and protect agriculture, saw spending more than double, from $46 to $94.6 million.


Budget share: up 0.6 percent, to 34.6 percent

Ehrlich oversaw a 30-percent increase in combined funding for education—meaning the state’s institutions for higher education, the Higher Education Commission, and the Department of Education—from $7.6 to nearly $10 billion in 2007. The number of full-time equivalent jobs rose 7.2 percent to 30,617.

The University System of Maryland Office, which staffs the system-governing University of Maryland Board of Regents, saw the greatest increase in spending: 68 percent, from $13.8 to $23.2 million. The Department of Education Headquarters, whose spending grew by nearly 42 percent, from $187.6 to $266 million, runs the show for the department, providing leadership, support, and accountability for local public school systems, library services, and other public-education programs around the state. And a 40-percent budget boost, from $563.8 to $790.3 million, was enjoyed by University of Maryland, Baltimore, which is comprised of schools of dentistry, law, medicine, nursing, pharmacy, and social work.


Budget share: up 0.5 percent, to 24.8 percent

Spending at the Department of Health and Mental Hygiene (DHMH) jumped 30 percent under Ehrlich, from $5.5 to $7.1 billion, while it shed 433 jobs, bringing the total down to 8,137.

The AIDS Administration’s spending increase, from $48.6 to $68.7 million, tops the growth list among DHMH’s operations. It works to fight the spread of HIV. Also getting a big jump in spending was DHMH’s largest program, the Medical Care Programs Administration (MCPA), which went from $3.5 to $4.8 billion. MCPA manages the Maryland Medicaid Program and provides access to healthcare for Marylanders eligible for poverty assistance. And spending by the Developmental Disabilities Administration (DDA) grew nearly 37 percent, from $458.9 to $627.9 million. The DDA supports services for Marylanders suffering from developmental disabilities, such as mental retardation.


Ehrlich Losers


Budget share: down 1.6 percent, to 12.3 percent


Ehrlich’s overall budget picture was so flush that even the agency whose share of the budget pie shrank the most, the Department of Transportation (DOT), still experienced a spending boost from $3.1 to $3.5 billion, though the number of transportation jobs dropped nearly 3 percent to 9,170.

Debt-service requirements were the most-reduced DOT expense, dropping almost 14 percent to $114.6 million. The lightened debt-payment load goes to service bonds issued to underwrite transportation-related capital projects. The Secretary’s Office’s spending dropped from $368.7 to $338.5 million. The office sets policy, manages the disbursement of grants, and works to make sure the state’s transportation systems are properly operating and funded. The Mass Transit Administration’s spending increased 4 percent, from $632.6 to $657.6 million, a meager rise in funding for running the state’s transit systems, including buses and rails.

Human Resources

Budget share: down 1.2 percent, to 5.8 percent

The Department of Human Resources (DHR) saw its share of the total budget drop significantly, yet its spending increased 5 percent from just under $1.6 to almost $1.7 billion. Its staffing was reduced 5.2 percent to 7,084. The department provides assistance to needy and vulnerable Marylanders, especially children.

The Social Services Administration (SSA) saw the largest drop—30 percent, from $31.8 to $22.3 million. The SSA supervises local child-welfare efforts. Spending by the Child Support Enforcement Administration, which coordinates child-support efforts by local social-services departments, saw spending decline 17.4 percent, from $49.5 to $40.9 million. Spending on Local Department Operations, where the bulk of DHR’s work is done, increased a moderate 6.2 percent, from $1.23 to $1.3 billion.

Business, Regulation, Development, and Planning

Budget share: down 0.2 percent, to 2.3 percent

Even though four agencies that regulate and support the state’s businesses—the Departments of Business and Economic Development (DBED); Labor, Licensing, and Regulation (DLLR); Housing and Community Development (DHCD); and Planning—saw their slice of the budget pie shrink, their spending increased by a fifth from 2003 to 2007, to $661.1 million. Staffing, meanwhile, was reduced 6.3 percent to 2,519.

The biggest loser was DBED’s Division of Regional Development, where spending dwindled by 63.7 percent, from $13.5 to $4.9 million. It is described in budget documents as DBED’s “feet on the ground,” working directly with business owners and economic-development interests to promote business activity. Also feeling the hurt was DLLR’s Division of Racing, which regulates Maryland horse racing; its spending was cut 38.9 percent to $6.6 million. DLLR’s Division of Workforce Development, meanwhile, suffered a 34.6 percent funding cut, down to $50 million. It oversees Maryland’s employment and training activities and conducts labor-market analyses.

O’Malley Winners


Budget share: up 5.4 percent, to 40 percent

Overall state education spending continued its upward trajectory under O’Malley, increasing 22 percent to $12.1 billion. Employment in the three divisions—the State Department of Education, the Higher Education Commission, and the state colleges and universities—increased by nearly four percent, to 31,698. There were differences among the agencies.

The budget for the State Department of Education, which oversees primary education (K-12), increased 23 percent, from $5.6 billion to $6.9 billion. But 222 jobs disappeared, its full-time positions reduced from 1,767 to 1,545.

Aid to Education (money distributed to counties and municipalities and applied to K-12 schools and administrations) grew substantially, however, from nearly $5.3 billion to nearly $6.6 billion—about 25 percent. Included in this is the “Geographic Cost of Education Index” fund, which increases the allotment for Prince George’s and Montgomery counties, plus the City of Baltimore, by about $126 million. (This is funding that Ehrlich has proposed cutting in order to pay for a 1-cent reduction in the state sales tax.) The federal goverment brought $350 million in the form of “stimulus spending” as well.

The state’s Higher Education Commission’s budget increased by about $70 million. All of that increase—plus more—went out as aid to community colleges, which saw increases from $205.9 million to a projected $279.2 million. About 20 full-time jobs were lost over the past four years.

Higher Education Institutions saw their share of the total budget climb from $3.9 billion in 2007 to more than $4.7 billion in 2011, a four-year budget increase of 21.2 percent. The employee head count at the state’s colleges and universities increased from 28,774.5 to 30,096.1, about 1,322 full-time jobs.


Budget share: up 2.9 percent, to 27.7 percent

DHMH’s budget increased by 24.5 percent to nearly $8.9 billion in 2011. The number of state jobs at DHMH was reduced by 1,236 to 6,900.

Of the $1.7 billion increase to DHMH’s budget, more than $1.4 billion is accounted for in the Medicaid program.

The Mental Hygiene Administration increased by 25 percent to about $723 million. An additional $135 million went to DDA, bringing its 2011 budget to almost $763 million.


Human Resources

Budget share: up 0.9 percent, to 6.7 percent

DHR saw its budget increased 29 percent, from $1.7 billion to $2.1 billion, yet 304 jobs were eliminated. Local department operations—aid to cities and counties across the state—absorbed $450 million of the increase.

The Office of the Secretary’s budget quadrupled, from $13.7 million to $54.5 million. Much of that gain appears to have occurred in 2008, when the office’s expenditure increased to $64 million. The line item marked “operating expenses” ballooned to $49 million that year, from $2 million the previous year. Human Resources officials say this was due to a reorganization.

O’Malley Losers

The environment

Budget share: down 1.1 percent, to 2.1 percent

Environmental spending fell by more than 25 percent under O’Malley, declining from $931 million in 2007 to $675 million in the 2011 fiscal year budget. Of the three agencies affected—MDA, MDE, and DNR—only MDE was spared deep cuts.

MDA’s budget dropped by 50 percent during O’Malley’s tenure, from $155 million in 2007 to a projected $99 million in 2011, but the head count did not change much. Most of the cut was in the secretary’s office.

The story is similar at DNR, which saw its budget cut by 40 percent, from $495 million to less than $298 million. Positions fell from 1,755 to 1,657, or 98 jobs, almost all of them in the ranks of government workers (14 contract jobs went away too). Much of DNR’s budget declines occurred in the first two years of O’Malley’s administration, and are mainly attributable to the real estate crash. The decline in real estate transfer taxes reduced the department’s funding for land acquisition, which had ballooned under Ehrlich.

MDE saw its budget fall from $281 million to $278 million (1 percent), but the head count actually rose by 43, from 972 to 1,015. The new workers will be focused on enforcing coal burning regulations, erosion and sediment control, and storm water construction permits.


Budget share: down 1 percent, to 11.3 percent

DOT’s budget increased about 2.8 percent, from about $3.5 billion to $3.6 billion, but as a percentage of total state spending, it fell. About 20 jobs have been cut since O’Malley took office. The department has been postponing capital projects and upgrades to computer systems and software.

Business, Regulation, Development, and Planning

Budget share: down 0.3 percent, to 2 percent

The budget for DBED, which helps businesses relocate to or expand in Maryland, crashed under O’Malley. Its 2007 budget was $136 million; by 2011 it was reduced 30 percent, to $94.5 million. As was the case in Human Resources, though, the Office of the Secretary tripled in size, from a bit more than $4 million to more than $12 million, the result of a reorganization that folded the $4.6 million Division of Administration and Information Technology and other former stand-alone divisions into it.

The Division of Tourism, Film and the Arts dropped from $38 million to less than $27 million. The Division of Regional Development, nearly $5 million in 2007, has been reorganized as part of the Division of Business and Enterprise Development, whose 2011 budget is set at about $52 million.

Bucking the trend toward lower funding for business regulation, the Department of Labor, Licensing, and Regulation—the overseers of everyone from cosmetologists to engineers—saw a 29-percent budget increase under O’Malley, plus a couple hundred more jobs. Most of the increase is in the Division of Workforce Development, which coordinates job training and apprenticeship programs, including welfare-to-work programs, which had a $50 million budget in 2007, and an $89 million bottom line in 2011—a 78 percent increase. The other big gainer was unemployment insurance.

The state DHCD also saw its budget increase slightly, from about $300 million to $305 million. Its employee roster increased by about 40, to 377.

The state Planning Department was cut in half, from about $51 million in 2007 to $24 million in 2011. The major cuts were to Historical and Cultural Programs. About 25 jobs are gone.