Governor O’Malley Discusses Working Collaboratively and a Balanced Approach of Reductions and New Revenues at Summer Conference

Governor O'Malley addresses MACo attendees.

In MACo summer conference tradition, Governor O’Malley provided his keynote address Saturday morning, August 20, citing the need to create jobs and expand opportunity in Maryland.   As reported by the Towson Patch, the Governor began his remarks as follows:

One year I hope to be able to come before you and proclaim a return to full employment, a restoration of all highway user dollars and other state grants,” O’Malley said. “One year I hope to come here and proclaim the existence of a giant, deficit-slaying surplus. But that year isn’t this year.

He went on to discuss three “fundamental truths” that need to be acknowledged to create jobs and opportunities.

Truth #1:  To Create Jobs:  A Modern Economy Requires Modern Investments – The Governor commented that even as $6.8 billion has been cut from the budget, the State has made the single largest investment in public education, made college more affordable, and created the largest infusion of venture capital into State’s economy through InvestMaryland. He also referred to moving forward with the Red Line, Purple Line, and the statewide broadband network.

Truth #2:  A Balanced Approach – The Governor stated that the projected budget shortfall for FY 2013 is approximately $1 billion and the State faces three primary shortfalls:  1) a general fund operating shortfall caused primarily by the recession; 2) a shortfall in the action required to at least maintain the level of sewage treatment upgrades of the flush fund; and 3) a shortfall in the level of action required to safely maintain and improve our transportation infrastructure.  He said we must be ready to move forward with a balanced approach of more cuts and be open to new revenues.

Truth #3:  We’re All in This Together – Every county is critically important to the whole and we need cooperative efforts to reach our potential for creating and saving Maryland jobs.

Although he did not offer specifics on teacher pensions, when referring to this area and a few others, the Governor did comment that “he and the counties have come to talk about tough choices and that Maryland has fared better than most states because of our ability to come together with a balanced approach every year, time and time again”.  He reiterated this point on WTOP this morning on “Ask The Governor” with Mark Segraves.  When asked about shifting teacher pension costs to counties, he replied that he has been in favor of keeping costs at the State level and hopes that as this issue continues to be discussed others will approach it with an open mind and a balanced approach.

In coverage of the Governor’s remarks at the conference, the Washington Post reports:

O’Malley (D) offered no specifics but said he will consider a range of “new revenues” to help close a projected budget gap that is likely to grow in December after the new congressional “supercommittee” completes its work.

According to the Baltimore Sun, any actions to increase revenues will wait until the January session.

Speaking to reporters after delivering the keynote address at the Maryland Association of Counties summer conference, O’Malley declined to go into detail. He said conversations about new revenues should wait until after the congressional “super committee” makes its recommendations in December for cutting the federal budget deficit. He said because of that timetable, it’s unlikely that taxes would come up in the General Assembly’s special legislative session this October.

House Speaker Michael E. Busch, a Democrat, said discussion of possible tax increases would wait till next year unless there is some “catastrophic event.” Busch said possible revenue streams include an increase in the gas tax, which hasn’t been raised since 1992.

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