Painful fiscal balancing act Legislators pass bills, then shy away.


Lawmakers were stricken with a mass case of camera-shyness when it came time to be photographed with their latest handiwork -- a painful budget-balancing bill.

The General Assembly overwhelming passed that bill, along with a separate one raising Motor Vehicle Administration fees, a special session yesterday that addressed some of Maryland's money woes.

At a routine ceremony in the State House afterward, no one stepped forward to join the group photograph for the budget bill, although such pictures are customarily taken as the governor signs a bill into law.

That left it up to Gov. William Donald Schaefer, Senate President Thomas V. Mike Miller Jr. and House Speaker R. Clayton Mitchell Jr. to muster happy faces for the camera.

What was painful for most legislators was agreeing to $125 million in spending cuts and transfers from emergency accounts to the state's general fund. But that's what it took to make sure the state budget is balanced by the time FY 1991 ends Sunday.

The budget-balancing bill transfers $84.2 million in special-use accounts to the state's General Fund. The bill is part of a $125 million agreement between Schaefer and the legislature that calls for the governor to trim spending by $41 million.

The cuts and transfers affect a wide spectrum of programs, including park acquisitions, capital building projects and housing loans.

In other matters, lawmakers passed a bill yesterday authorizing increases in about 60 fees charged for items such for driver's licenses, vehicle titles and dealer business licenses.

The MVA bill is expected to bring in $35 million during the 1992 budget year, which the state will use as its matching share to secure $312 million in federal highway and bridge funds. The federal government requires states to pay a percentage of the cost of certain projects to qualify for federal money.

The special session began with a festive air, despite the unpleasant agenda of budget cuts and fee increases. Legislators, many of whom had not seen each other since the regular session ended in April, greeted each other with handshakes and back-slapping, and snacked on coffee and rolls.

The mood changed temporarily, though, when House members from Baltimore challenged the budget bill's priorities for returning any surplus money to current programs if less than $125 million is needed to actually balance the budget.

Although Maryland's latest projected deficit for 1991 has been set at $109 million, fiscal experts recommended cutting $125 million to leave a financial cushion in case the estimated shortfall worsens.

The 1991 fiscal year ends June 30, so the legislature was forced to act to avoid deficit spending before the start of the new fiscal term.

Legislative leaders and committee members who gave the bill preliminary approval Monday agreed that if the actual shortfall is less than $125 million, surplus money should be given back to Program Open Space, a special fund set up to buy park and recreation land, and to the Department of Housing and Community Development's housing loan program.

About $12 million in Open Space funding earmarked for use by local subdivisions will be sacrificed to balance the budget if the entire $125 million is needed.

In a short-lived but spirited move on the House floor yesterday, Del. Clarence Davis, D-City, urged lawmakers to amend the bill so the housing loan program would have a higher priority for funding givebacks.

"I think it's selfish on the part of the parks and recreation people to put their desires on the true needs of this state," said Davis.

Davis' attempt to rewrite a portion of the bill failed after House Appropriations Chairman Del. Charles J. Ryan, D-Prince George's, and Vice Chairman Del. Howard P. Rawlings, D-City, argued that programs for the needy already had been spared budget cuts.

Schaefer applauded the legislature for raising motor vehicle fees, as his administration had requested, but he repeated his belief that the state still needs a gasoline-tax increase.

The fee bill, which will be implemented in September, enables the state to recoup the costs of various MVA services.

The cost of renewing a driver's license will rise from the current $6 for a four-year license to $20 for a new five-year license. A title certificate for a new vehicle will increase from the current $1 to $12, and an annual business license for car dealers will rise from $50 to $250.

Annual vehicle registration fees, however, are not affected.

The revenues raised will help bolster the state's sagging fund for transportation projects and enable about 120 stalled highway, rail, airport and port projects to proceed.

The bill's opponents, however, argued that it provides only a temporary approach to solving a larger problem of transportation funding and growth.

Unless the legislature tries to control sprawling development, it will continue to have to pass tax increases to accommodate growth, said Sen. Gerald Winegrad, D-Anne Arundel. "You know we will be back in January or earlier to discuss a major gasoline tax increase," he said.

Although it had the opportunity, the legislature did not override any of Schaefer's regular session vetoes, sealing the doom this year of bills affecting the speed limit and the Lida Lee Tall Learning Resources Center in Baltimore County.

Last month, Schaefer vetoed a bill that would have permitted the speed limit to be raised to 65 mph on certain rural interstate highways. Citing the state's budget problems, he also vetoed a measure that would have provided $500,000 for Lida Lee Tall, an independent elementary school at Towson State University.

Although yesterday's actions will give the state a financial respite, the legislature faces tough money problems ahead. Budget experts predict a fiscal 1992 shortfall of $300 million, and a whopping $573 million deficit for the 1993 fiscal year.

Asked what can be done to eliminate the deficits, Schaefer replied: "I don't know the answer to that. I just don't know."

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