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Analysts predict "small" state budget hole

The Baltimore Sun

State lawmakers will have to address a combined budget gap of $580 million over the next 18 months when they reconvene in January.

The state's chief analyst on Wednesday described the problem as relatively small given the nearly $2 billion shortfall the state grappled with in recent years.

"We are starting in a small hole, certainly compared to what we have seen in the past," Warren Deschenaux, director of the office of policy analysis in the Department of Legislative Services, said to the Spending Affordability Committee. That panel advises the governor on spending matters.

The budget gap is caused in part by a sluggish economy that delivered less in personal and corporate income tax than state officials anticipated. The state also asked a new set of experts to estimate how much the state would earn from its casinos. The new experts concluded Maryland would take in about $90 million less than anticipated this year.

If the estimates hold and current spending continues, the state could face a $189 million hole in its current budget and a $391 million one in the budget year that begins July 1. Lawmakers will have to take that into account as they consider next year's spending plan.

The state has a rainy day fund of $764 million.


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