House Committee Votes to Restore Education Funding, Employee COLAS and Medicaid Rates

During its decision meeting on Friday, March 13, the House Appropriations Committee unanimously approved its fiscal 2016 budget plan, which almost restores full funding for education, restores a 2 percent cost of living adjustment (COLA) for State employees, and increases Medicaid rates for health care providers.

As reported by the Baltimore Sun,

The delegates spent less than three hours trimming hundreds of millions of dollars from Hogan’s proposal and directing the money to other programs.

The panel’s spending cuts came from a wide variety of programs. The single largest reduction, of $75 million, came from making a smaller payment into the state employees’ pension fund than originally planned.

The Committee’s approved budget plan will close the State’s structural deficit by 74% in fiscal 2016. Governor Hogan’s proposed budget would have closed it in one year. To do that, the Governor was proposing to permanently cap the growth in statutorily mandated funding formulas. The Committee rejected this proposal.

The actions taken by the Committee, will almost fully fund education in the upcoming year.

A big part of the restored education aid comes from the committee’s decision to fully fund the Geographical Cost of Education Index which gives an extra portion of state education aid to localities where it costs more to educate children. In all, the committee voted to call on Hogan to put back $130 million of the $143 million in education aid cuts he had called for.

The Committee rejected the Governor’s proposal which would have reduced the per pupil funding in the education formula and capped out-year growth. However, the Committee did agree to extend the phase-in of a wealth measure used in the funding formula, resulting in a reduction of approximately $13 million.

To fund the identified budget priorities, the Committee adopted language to restrict the funds generated through reductions or other budget actions to specific programs.

Hogan is not required to agree with about $179 million worth of spending ideas pushed by the committee, but he also can’t use the cash for anything else.

“He doesn’t have to go along with it,” [House Appropriations Committee Chair] McIntosh said. “If he doesn’t, he’ll just be sitting on that money. He can’t use it for tax relief.”

In addition to restoring the COLA for State employees and funding the Geographical Cost of Education Index, these restricted funds are specified for health and social programs.  As reported by the Washington Post,

The changes also provide increased funding for several safety-net programs, including providing $2 million for treatment of people addicted to heroin, $6.5 million to maintain the provider rates for those who work in the community health field and Medicaid coverage for pregnant women whose income levels were slightly above the regular eligibility for the federal program.

The Baltimore Sun reports,

The Republican governor released a statement saying that while he has concerns about some of the committee actions, “I believe we are headed in the right direction overall.”

[State Budget Secretary David] Brinkley said he considered the committee’s choices “laudable goals” but added that the governor still had a key priority that hasn’t been addressed: “Taxpayers are still looking for some tax relief.”