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House panel cuts budget severely, hopes for tax aid


ANNAPOLIS -- The House Appropriations Committee cut the governor's budget last night about as much as lawmakers could stomach, and then -- hoping a couple tax proposals will ultimately save them -- they cut it some more.

Trying to overcome a projected $115 million drop in state revenues for fiscal 1992, the panel offered up about $120 million in program reductions, large, small and in between. They carved out funds for new judges, maintenance of state facilities, parkland acquisition and hundreds of other programs, projects and positions.

Then, to balance the budget without transferring $76 million in transportation funds to the general treasury as Gov. William Donald Schaefer had proposed, the committee agreed to cut about $73 million more in state programs that assist local governments.

That casualty list would include $25 million from the proposed $82 million increase in the "APEX" aid to education program and $26.6 million that the state returns to encourage local governments not to raise property taxes.

Also cut would be: $2.5 million to help fire and rescue companies buy equipment; $6 million for the Prince George's County "magnet school" program; $3 million for police foot patrols in Baltimore and in Prince George's County; another $6 million for teachers' and librarians' Social Security costs; and $3.8 million for resident state trooper programs in Carroll, Frederick, Talbot, Washington, Cecil and Calvert counties.

Those cuts could be avoided with the passage of tax proposals.

Charles J. Ryan Jr., D-Prince George's, the committee chairman, said he and other House leaders have tentatively agreed to push for passage of two revenue-raising mea

sures: one that would apply the state's 5 percent sales tax to the per-package cost of cigarettes, raising about $34 million; and another that would broaden Maryland's capital gains tax for people earning $200,000 or more a year, which would raise about $40 million for the state and another $20 million for local governments.

The committee intends to take the budget to the full House next week with the entire array of reductions in place and let the delegates determine if they want to pass the tax proposals to spare the local government programs. By tying the tax bills to reductions that will be hard for any local governments to absorb, especially those that have their own budget problems, House leaders believe they will leverage support for tax increases from lawmakers who otherwise would be reluctant.

The long list of other reductions -- those that will stand unless reversed on the House floor or later by the Senate -- include $16.5 million the governor had set aside to hire new employees to fill positions held vacant because of the current hard times; $3.6 million for new Circuit Court judges for Montgomery, Prince George's and Washington counties; $1.9 million from the State Lottery Agency's advertising budget; $590,000 by eliminating the state publication "Maryland Magazine"; and $25,000 for promotional events for the state-owned clipper ship, Pride of Baltimore II.

Mr. Ryan said the committee hoped to salvage some of the programs being slashed from the state's operating budget -- the $18 million for parkland acquisition and the $2.7 million for farmland preservation -- by proposing that general obligation bonds be sold to raise money in place of that cut. Such a tactic, he said, would be temporary, and the programs would be financed in traditional ways once the economy recovers.

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