The Maryland Public Policy Institute
JULY 2, 2010
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It’s the new fiscal year. I don’t really feel like celebrating, though. The new year brings a raft of new laws (few of which expand our freedom) and a state budget that is already out-of-balance. It is nothing to ring in with confetti or a verse from Auld Lang Syne.
As far as the budget goes, the state relied on $389 million in imaginary federal funding to balance the budget. Since this money does not exist, the state has to come up some other way to pay for it. This irresponsible budgeting has been criticized by a diverse group of sources, ranging from the Baltimore Sun editorial page to yours truly. When there is consensus from left to right about how bad this fiscal year’s budget is, you know you have something really awful.
Of course, as the Sun editorial pointed out, it’s not as if the budget’s current problems are a surprise. Even back in January it looked like Congress may not approve a Medicaid bailout for the states. And as the Department of Legislative Services fiscal briefing from February has ample analysis of how this budget is only balanced because of fund transfers and anticipating unapproved federal money. But the governor and lawmakers gambled on this federal money being appropriated and didn’t care if they took money that rightly belonged to counties, and so we’re looking at an unbalanced budget on the very first day of the fiscal year.
You’ll forgive me if I don’t spend money on expensive champagne to celebrate the new fiscal year. I need to save it up for the inevitable tax increase that will be coming in 2011.
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