Gov. Moore releases $63 billion Maryland budget plan

Maryland Gov. Wes Moore released his $63 billion budget plan for the state Friday, outlining education and transportation as priorities amid a large budget surplus while maintaining an ample Rainy Day Fund to be prepared for an economic downturn.

Moore, a Democrat, described his budget plan as being "bold without being reckless."

"It prepares us to weather the downside risk in the larger economy, but it also makes long-needed investments to position us for long-term growth," Moore said at a news conference.

While Maryland, like other states, has had a large budget surplus with the help of enormous federal pandemic aid, officials say they are preparing to do without that kind of help with a potential economic downturn on the horizon.

Budget plan highlights include:

Historic Investment in Service and Education

Record $8.8 billion investment in K-12 education for Maryland public schools;

Record $393 million for Maryland's 15 local community colleges; $421 million in state support for Maryland's historically black colleges and universities, amounting to a 19% increase, and a 12% increase in funding for the University System of Maryland;

$18 million across FY 2023 and FY 2024 to fund the new Department of Service and Civic Innovation to enhance and coordinate service opportunities for Marylanders;

Record $112 million in funding for the Educational Excellence Awards program, the state's largest need-based student aid program, which is projected to serve more than 30,000 students in FY 2024.

Historic Investment to End Childhood Poverty

Permanent extension of the enhanced Earned Income Tax Credit (EITC) and expansion of the Child Tax Credit (CTC) through the Family Prosperity Act;

Accelerating Maryland's minimum wage to $15 per hour through the Fair Wage Act and indexing the wage to inflation.

Investment to Strengthen the State Government Workforce

In total, the budget over the two fiscal years includes $1.3 billion for employee salary and benefit enhancements;

$39.4 million in salary adjustments for registered nurses, attorneys, emergency response technicians, and certain educator positions;

Increased base hiring steps for social services workers, parole and probation officers, and DJS resident advisors.

Investment to Ensure a Healthier Maryland

Record $1.4 billion in direct state support for mental health and substance use programs;

More than $616 million to fund provider rate increases in the fields of behavioral health, developmental disabilities, Medicaid, and other services;

More than $154 million to expand adult dental coverage to Medicaid clients and $17 million to reduce waitlists for programs that allow seniors to age in their communities.

Investment to Promote Public Safety

$122 million in aid to local police departments, including $17.5 million dedicated to Baltimore City, and expansion of the Office of the Attorney General and the Office of the Public Defender;

Nearly $69 million in direct local law enforcement grants and $35 million in General Funds for Victims of Crime Act (VOCA) funding;

$18 million for the Correctional Officers and Parole and Probation Agents retention incentive bonus program and $8 million and more than 40 additional positions to expand the State Police Gun Center and Firearms Licensing Division.

Investment to Protect the Environment

$422 million for programs funded by the transfer tax that support land preservation and operations and capital projects in State parks, Including $129 million in General Funds to fully fund the transfer tax repayment provision as revised by the Great Maryland Outdoors Act.

The budget, which will now be taken up by the General Assembly, maintains a Rainy Day Fund of about $2.5 billion, or 10% of the state's general fund. In addition, it has a fund balance of $820 million on top of that.

"It serves as a strong hedge against revenue volatility and as dry powder for critical strategic investments, particularly in the areas that the governor has begun to speak about," said Helene Grady, Moore's budget chief.

Moore highlighted a $500 million allocation to the state's sweeping education reform law known as the Blueprint for Maryland's Future, which is being phased in with costs rising in later years. The blueprint focuses on expanding early childhood education, increasing teachers' salaries, and providing aid to help struggling schools adequately prepare students for college and careers.

Moore also underscored a $500 million general fund investment in transportation the administration plans to leverage with additional federal matching fund support. The money will be set aside as a dedicated reserve to support priority projects across the state.

"We need to have a transportation system that allows people to get from where they live to where opportunity lies," Moore said.

The Moore administration also is aiming to fill about half of the state's 6,500 vacant positions in executive branch agencies, Grady said. The budget plan also adds an additional 589 new state positions, including 143 contractual conversions.

Democrats, who control the General Assembly, reacted positively to the governor's plan.

Senate President Bill Ferguson, a Baltimore Democrat, described the budget as "very much in line with the large shared values that we have with the administration."

"Certainly, as we move forward, we'll have more specific comments on specific line items, but I think overall it was very much a budget of shared values," Ferguson said.

Lawmakers will have new budget powers this legislative session, after voters approved a constitutional amendment in 2020. Previously, Maryland's governor had unusually strong budget authority in the Maryland Constitution, because the legislature was only allowed to cut from the governor's plan. Lawmakers now can increase, decrease or add items to the budget, as long as the changes don't exceed the total proposed by the governor.

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Republicans said tax cuts or greater savings should be undertaken with so much surplus.

"It is not enough to tout the lack of tax increases in a budget year if the level of spending will require tax hikes down the road," Del. Jason Buckel, an Allegany County Republican who is the House minority leader, and Del. Jesse Pippy, a Frederick County Republican who is the minority whip, said in a statement. "It is important to be principled and disciplined now, so we don't burden our taxpayers later."

The governor, who has focused on addressing childhood poverty, also has budgeted $171 million to permanently extend the Earned Income Tax Credit and Child Tax Credit. Moore also has set aside $18 million for the new Department of Service and Civic Innovation to create a service year program for high school graduates.

Moore also is calling for an acceleration of raising the minimum wage to $15 an hour by October — and to index it to inflation for future increases.

Republicans panned that proposal.

"I hope he realizes that wages won't matter when there are no employers to pay them. We must find a path that works for employees and employers," Buckel said.

CBS Baltimore Staff contributed to this story.

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