Aiming to close the state's $1.8 billion budget shortfall, Gov.-elect Robert L. Ehrlich Jr. is considering what could resemble a gigantic yard sale.
Ehrlich's transition team has asked all state agencies for an inventory of their assets, including buildings and land. The Republican governor-elect plans to scour the inventory for assets that could be sold or leased to raise money and rebuild the state's tax rolls.
"We asked for the inventory with an eye for identifying what the state owns," said Steven L. Kreseski, Ehrlich's chief of staff. "At a later date, a decision will be made as to if the property is being used in the best way for the state of Maryland."
Sources on Ehrlich's transition team say he believes hundreds of millions of dollars could be raised by selling assets ranging from underused parcels of land to the 28-story William Donald Schaefer Tower at 6 St. Paul St. in downtown Baltimore.
"All options are on the table once the inventory is complete," said Ehrlich spokesman Henry Falwell.
But Comptroller William Donald Schaefer and some environmental leaders urged caution.
"I have a little advice for them," Schaefer said. "Be careful what they sell."
Schaefer said some buildings, including his beloved William Donald Schaefer Tower, are cost-efficient because they save the state the expense of having to pay rent for office space.
The former governor and Baltimore mayor also predicted that Ehrlich will face stiff criticism if he tries to unload parkland or other tracts that preserve open space.
"If they try to sell parkland, they will run into a double buzz saw," said Schaefer, who is a frequent critic of Gov. Parris N. Glendening's land purchases. "They will have a big fight on their hands and I would oppose it, too. I want to help Ehrlich, but they've got to be careful what they do."
Plane and yacht
During the campaign, Ehrlich pledged to raise $5 million by selling the state airplane used by the governor, the state's 114-foot yacht and two of the state's luxury skyboxes at Oriole Park.
But as the grim reality of the state's fiscal situation sets in, the Ehrlich camp is fishing around for other state assets.
The state owns about 60 million square feet of office space and tens of thousands of acres of land - some of which is highly sought by developers.
"There is no question we are in frugal times and austere times and everything has to be looked at specifically," said Sen. J. Lowell Stoltzfus, a Lower Eastern Shore Republican who is advising Ehrlich on budget issues.
Stoltzfus refused to comment further. Lt. Gov.-elect. Michael S. Steele, chairman of Ehrlich's transition team, also declined to comment.
Fiscal analysts estimate the state faces a $1.8 billion budget shortfall over the next 18 months. Maryland's overall budget is about $21 billion, but the deficit applies mostly to the $10.5 billion general-funds portion that goes to pay for most state services.
Ehrlich has ruled out raising income or sales taxes to address the shortfall, meaning he will have to cut state programs drastically or find other revenue sources, especially if the General Assembly blocks the legalization of slot machines at Maryland racetracks.
Yesterday, Democratic legislative leaders said they support Ehrlich's decision to look at liquidating some state assets.
"When you've got as big of a deficit as we have, you've got to be looking at every single thing," said Sen. Thomas M. Middleton, a Charles County Democrat and incoming chairman of the Senate Finance Committee. "You may find you have a lot of state-owned land that serves no purpose, and it would make sense to sell."
But environmental leaders caution that it would be a mistake to sell land designed to protect natural resources.
"I think there could be places where selling some state property makes sense," said Dru Schmidt-Perkins, executive director of 1000 Friends of Maryland. "But I also hope [the parcels] are looked at really carefully in a number of different ways to make sure we are not selling off something that should be kept for future citizens of the state."
Sale not so easy
J. Charles Fox, the secretary of the Department of Natural Resources, said Ehrlich's transition team will quickly learn they cannot sell large portions of state-owned land. These include land bought with the help of federal dollars or property on which the state purchased full easements or development rights.
Even if land can be sold, Fox said, he would resist attempts to get rid of land purchased to preserve open space.
"I believe it would be very short-sighted to sell off these assets for near-term budget purposes," said Fox, who is leaving his post to take a job at the Chesapeake Bay Foundation.
Officials on Ehrlich's transition team said one option under review is leasing tracts of state land to farmers who agree to grow crops on it, but not develop it. The state would then receive property taxes from the land.
Schaefer also expressed reservations about selling some state buildings.
The comptroller said he bought several buildings when he was governor - including the Schaefer Tower - to try to save the state the long-term costs of paying rent.
The tower was purchased for $12.2 million in 1993. The state invested an additional $6 million to carve out offices for 1,100 state employees.
Saving $48 million
At the time of purchase, state auditors estimated it would save the state $48 million in rent over 15 years, according to Dave Humphrey, spokesman for the Department of General Services, which manages the building.
Humphrey said the Schaefer Tower was one of 54 buildings listed on the DGS inventory given to the Ehrlich transition team. All state agencies are supplying similar lists, officials said.
Kreseski, Ehrlich's chief of staff, said it would likely be months before final decisions are made on which assets could be sold.
Del. Alfred W. Redmer Jr., a Baltimore County Republican on Ehrlich's transition team, vowed the GOP administration will have the "long-term interests of the state" in mind when making these decisions.
"If you looked at all the state's assets, there is probably hundreds of millions of dollars in assets that could be liquidated," Redmer said. "But that doesn't mean it is in the best long-term interests of the state."