Gov. Martin O'Malley unveiled a $39.3 billion budget on Wednesday that includes no new taxes, puts the state on a path to close its structural deficit by 2017 and will bring universal pre-Kindergarten to Maryland by 2018.
Entering fiscal year 2015, the O'Malley administration faced a $584 revenue shortfall, including $193 million carrying over from fiscal 2014 and $391 million expected in fiscal 2015. O'Malley said his fiscal 2015 spending plan would close that gap.
The proposal would trim the revenue gap in part by saving $172 million on long-term state pension reform.
O'Malley touted the fiscal 2015 proposal did not include tax or fee increases and would put the state on track to closing its $1.7 billion structural deficit entirely by fiscal 2017. He called it a "jobs budget," that would support 48,000 new jobs.
But as the budget was distributed Wednesday afternoon, House Minority Leader Nic Kipke, R-Pasadena, said there still "aren't enough jobs to go around." Kipke accused O'Malley of "setting up this budget to put pressure on the next governor to raise taxes."
Kipke said no matter what is said, O'Malley is still growing the budget by nearly $2 billion.
"I'm disappointed there isn't a more measured spending plan," Kipke said. "I would have liked to see there be a meaningful tax relief program. He's really achieving the qualifications of what we would call a tax and spend governor."
O'Malley's $39.3 billion operating budget and $4 billion capital budget now heads to lawmakers in the General Assembly. The House and Senate can revise the proposals in any way they want before they must agree on a plan by the end of the 90-day session.
Education
Among education highlights in O'Malleys' fiscal 2015 budget proposal, the governor includes $289 million for school construction.
O'Malley said the funding for school construction would support 7,416 new jobs. However, $289 million is less than the average the O'Malley administration has funded school construction during each of his tenure.
Meanwhile, college tuition could be increased by 3 percent in Maryland for the fifth consecutive year. O'Malley's budget proposal caps tuition growth at 3 percent. The University System of Maryland's Board of Regents had requested a 5 percent cap, so the Board will likely decide to grow tuition the full 3 percent in fiscal 2015
Over the past five years, tuition and fees at Maryland four-year universities increased less than in any state but Missouri, according to a report by the nonprofit College Board.
O'Malley's fiscal 2015 budget proposal includes $6.1 billion for K-12 education, which he called a state record. That includes $4.3 million to begin an move in Maryland to universal pre-kindergarten by 2018.
Chesapeake Bay
To help clean the Chesapeake Bay, O'Malley's budget proposes at least $112 million to reduce non-point source pollution going into the bay, like stormwater runoff.
About $67 million will be distributed to projects through the states' Chesapeake and Atlantic Coastal Bay 2010 Trust Fund. That includes $42.4 million in the operating budget, nearly $11 million more than was allocated to the fund in fiscal 2014.
The Capital reported last year that of more than $254 million generated by the fund since 2009, just $72.2 million worth of projects have been completed, according to data provided by Maryland's Chesapeake Bay National Estuarine Research Reserve.
Since 2009, $135 million from the Trust Fund has been transferred to the state's general fund, according to the Department of Legislative Services.
But the Chesapeake Bay Foundation was pleased by the proposed allocation.
"When combined with the proposed capital dollars for local projects, the budget continues current levels of funding," said Alison Prost, Maryland executive director of the Chesapeake Bay Foundation. "It answers the question once and for all, 'what is the state doing to help on this problem?' Local governments need to match that commitment."
O'Malley's budget will go to lawmakers, who can revise the proposal before approving it.
Last year, O'Malley proposed an increase to the gas tax to fund transportation infrastructure projects. The General Assembly passed legislation raising gas taxes by 3.5 cents.
Tax Credits
O'Malley's fiscal 2015 budget proposal hikes tax credits offered by the state for cybersecurity, research and development and biotechnology companies.
The governor is proposing increasing the state's cybersecurity tax credit by 33 percent to $4 million. A credit offered to biotechnology and life sciences companies would see a 20 percent increase to $12 million. Also, a credit for research and development companies would increase 12.5 percent to $9 million.
