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Democrats refuse to budge in budget standoff, Hogan remains 'hopeful'

Senate President Mike Miller and House Speaker Michael Busch update the budget standoff.  Gov. Larry Hogan is looking for an additional $75 million in cuts. (Michael Dresser/Baltimore Sun)

As the hours tick down to a midnight deadline to pass a budget, Maryland Democrats Monday morning refused to consider Republican Gov. Larry Hogan's suggested compromise.

In rhetoric that has heightened since the weekend, they said they have done everything they plan to do to resolve the rift.

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"We're not done negotiating," Senate President Mike Miller said. "But we're not going to negotiate against ourselves."

Top leaders from the Senate and House of Delegates told reporters they have or are on track to deliver most of Hogan's legislative agenda by the end of the day: a repeal of the so-called "rain tax," a tax break for military retirees, more flexibility for charter schools, and a way to replenish the public campaign financing fund.

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But they said the would not acquiesce to Hogan's idea to choose among sending money to schools, paying for some pregnant women to be on Medicaid, paying for heroin addition treatment and a long list of other health care-related initiatives.

"We can not pick and choose amongst our constituent groups," Miller said. "We have done our job. We're asking for the second floor to do its job as well."

Hogan remained cheerful in early afternoon, posing for pictures with visitors in African garb along with Lt. Gov. Boyd Rutherford on Lawyers Mall.

"The ball's in their court. We made a substantive proposal to them on Saturday," he said. "We gave them a tremendous proposal."

Hogan said he would consider the session a success even if no agreement is reached.

"It'll be the first time in a decade we haven't had tax increases and it'll be probably the most fiscally responsible budget in 40 years," he said.

Nevertheless, Hogan has said the budget plan nearing approval in the legislature does not go far enough to close the structural deficit.

Spokesman Doug Mayer said the final version of the budget, completed late last week, worsened the state's financial standing. Mayer said governor disagrees with a budget that his analysis shows has a $250 million deficit for next year and a cumulative deficit of $1.7 billion by 2020.

"Being a legislator, being a governor is about making the tough decisions," Mayer said. "We're going to remain hopeful until the very last minute."

Senate and House budget leaders said they disagree with Hogan's analysis of their spending plan, and presented a dueling analysis from the nonpartisan Department of Legislative Services. That analysis suggested the legislature's spending plan created a deficit only $128 million more than Hogan's proposal.

They accused the governor of suddenly reversing course on a bipartisan-passed budget for which they said Hogan had signaled approval last month.

And with just hours left until the legislature is set to adjourn, Senate and House leaders said there is too little time left to make sweeping changes.

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"We thought we that we produced a budget that the governor was also proud of, only to find out in the wee hours of the session that he is not," said Del. Maggie McIntosh, a Baltimore Democrat and House Appropriations Committee chairman, said.

Key sticking points are whether Hogan agrees to send about $68 million more to public schools, prevent a 2 percent pay cut to state workers and spend tens of millions on health-related programs that include preventing cuts to pay for Medicaid doctors, for disability workers and medical coverage to some poor pregnant women.

Hogan offered Saturday to pay the state workers, give roughly $35 million more to public schools and leave a pool of cash for the Democrats to divide among health care priorities. But that pool is smaller than the legislature wanted because Hogan wants to spend $75 million more funding the state pension system.

Democrats on Monday said they were rejecting that offer.

In total, the sides are bickering over about $202 million out of a more than $40 billion spending plan.

For the past week, Hogan had remained steadfast that he wanted all of his legislative agenda passed in order to release money the legislature had set aside for schools, the pay raise and health initiatives.

Democrats had already killed some his tax breaks and amended others, and revamped one to the point Hogan said he would be forced to veto it if it came to his desk.

Democratic Sen. Joan Carter Conway of Baltimore said her committee put in 30 hours trying to find a version of Hogan's charter school bill that could earn enough votes to pass. In order to do so, they had to depart dramatically from Hogan's original proposal.

"Did we allow union busting? No. Did we allow uncertified teachers? No. But there is a lot of leverage [for charters] in that bill," said Conway, chair of the Education, Health and Environmental Affairs Committee.

Passing a balanced budget is the only constitutional requirement of the Maryland General Assembly. Legislative leaders could choose to pass the budget they crafted over Hogan's objection, but that would mean the governor could choose to ignore some of the spending priorities in it.

House Speaker Michael E. Busch said that Hogan's push for smaller deficits and some trims to long term spending has already been included in the budget, which was passed with support from most of the legislatures' Republicans.

"This should be a point where all sides come together and declare that they did what was in the best interests of the state," Busch said.

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