Thursday, November 19, 2009
Round 3 of State Budget Cuts
The State Board of Public Works approved on Wednesday $103 million in general fund spending reductions and $259 million of fund shifts to combat ongoing declines in state revenues for fiscal year 2010. Although 112 state employee positions were abolished, few of the cuts will carry over to future budget years that have a projected $2 to 2.5 billion gap between spending and revenues. While there are no easy budget cuts to be made, reductions impacting business include:
- $55 million reduction in Medicaid payments to hospitals, pushing these costs to full pay patients and employers;
- $1 million reduction to the State Tourism Board;
- $25 million reduction to the University System of Maryland and a $7 million reduction to private colleges; and
- $25 million shifted from a fee-supported fund designed to automate courthouse land records, and $6 million shifted from the Injured Workers’ Insurance Fund.
The actions should leave the state with a current year fund balance of slightly over $100 million as a hedge against further revenue shortfalls. Contact Ron Wineholt for further information at .(JavaScript must be enabled to view this email address).
