Worried about jeopardizing the state's AAA bond rating, the Senate Budget and Taxation Committee has reversed course and decided against borrowing money from the Maryland Automobile Insurance Fund to help balance the state budget.
The panel made the reversal after a warning from state Treasurer Lucille Maurer.
"If you want to defend the AAA, you don't borrow money for operating costs," Maurer said.
The two leading Wall Street bond rating houses have both given Maryland a AAA rating on its bonds, which enables the state to save millions of dollars in interest payments on its long-term debts.
The Senate panel had decided Wednesday to recommend borrowing up to $60 million from the Maryland Automobile Insurance Fund, the quasi-independent state agency that insures high-risk drivers. The committee wanted to send $20 million of that to help fund Baltimore's court system and sheriff's department.
After reversing its decision yesterday, the committee scrounged and came up with $8 million in cuts in other state programs to make up for some of the money it tentatively had planned to borrow from MAIF
The loser appeared to be the city of Baltimore, but the city's ranking member of the Senate budget committee remained optimistic.
"I'm confident we'll be able to find resources to help Baltimore City and the other poorer jurisdictions," said Sen. Barbara A. Hoffman, D-City. "We're going to have to start looking for something we can pull out or create."