Senate Committe Decisions – Pension Offsets and Other Budget Items

As previously reported, the Senate Budget and Taxation Committee this afternoon voted – unanimously – to shift the costs of the state pension system onto county governments. The proposal would cost county governments over $68.3 million in FY 2013, but ramps up to a $255 million shift by FY 2016. Just as in the Governor’s proposed budget, the Committee adopted a number of offsets to help the counties cover the cost of the pension shift as it is being phased-in.  These items have been incorporated into SB 152, the Budget Reconciliation and Financing Act, SB 523, State and Local Revenue Act of 2012 (bill as amended by the Committee), or the Governor’s budget as introduced.  The adopted offsets are listed below.  MACo has also prepared a grid comparing the Governor’s proposed budget to the Senate Plan.

  • Disparity Grant – $22.6 million and includes the Miscellaneous Grant for Baltimore City
  • Recordation Tax Indemnity Mortgage – Estimated offset $39.7 million
  • Forgiveness of Local Income Tax Reserve Repayment – $36.7 million
  • Restoration of Local Police Aid – $22.1 million in FY 14, increasing to $24.1 million in FY 17
  • Restoration of Inflationary increases for Local Health Departments – $2.2 million in FY 14, increasing to $5.2 million in FY 17
  • Federally Funded Teachers – $37 million

The Committee took the following actions on other items of interest in the Budget and Financing Reconciliation Act:

  • Rejected language to authorize the Governor to flat fund most programs at the FY 12 level for FY 13 through FY 17
  • Adopted language to require school boards to include funding for court judgments in their budgets

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