Board of Public Works Approves $280 Million in Budget Cuts

Governor renews commitment to protecting public schools, Maryland families


ANNAPOLIS, MD (July 22, 2009) – Maryland’s Board of Public Works, a three-person panel authorized to approve budget actions, unanimously approved more than $280 million in FY10 budget reductions today, a step in addressing a projected budget shortfall of more than $700 million for Fiscal Year 2010.  These actions would bring the total amount of reduced spending and budget cuts under the O’Malley-Brown Administration to $4 billion.

“In the past two and half years, some very tough circumstances – first an inherited structural deficit, and then a troubled national economy – have forced us to make some difficult choices,” said Governor O’Malley.  “We’ve made these choices with an eye toward protecting our core priorities of education, public safety, the environment, protecting our most vulnerable families, and protecting those things that keep Maryland positioned for economic growth and recovery.  Were it not for these decisions we made together, the choices we’d face today would be far difficult and Marylanders would be facing many of the nightmare scenarios plaguing other states.”

Today’s budget actions focus largely on state agencies, but protect entirely investments made in Maryland public schools.  General fund support for public education has increased more than $700 million since FY07, while spending for the remainder of the Operating Budget has decreased more than $800 million.

These cuts bring the FY10 Operating Budget below $13 billion, representing the first known incidence of General Fund declines for three straight years in the in state history.

According to a recent Rockefeller Institute report, 45 of 50 states experienced revenue declines in the first quarter of 2009.  The 11.7 percent overall drop in state revenues, according to the Institute, is the sharpest decline on record.   While budget cuts in Maryland have been painful, the State has largely avoided the types of drastic scenarios such as cutting aid to public schools and implemented massive, large scale layoffs of state employees.  California, for example, has enacted cuts of over $11.6 billion to K-12 education, and more than 25,000 teachers already lost their jobs there.  South Carolina has already laid off more than 1,500 employees in the past year.

Maryland’s unemployment rate remains well below the national average – 7.3 percent compared to the national 9.5 percent rate.  And just this week, all three credit reporting agencies affirmed Maryland as one of only seven states to retain the coveted AAA bond rating, granted only to those governments that demonstrate remarkable fiscal stewardship.

View the presentation Governor O’Malley delivered before the Board of Public Works today.

View a complete list of today’s budget actions.

Additional Press Releases