MD General Assembly to have special session for budget

On Monday, May 14th, the General Assembly will convene for a special session to discuss and vote on a budget for FY 2013. According to an announcement yesterday from Governor O’Malley, the compromise budget proposal that will be discussed includes $109 million in spending reductions to the $35.9 million budget, as well as an income tax increase and elimination of exemptions that would generate $195.6 million in state revenue.

The plan also includes a shift of 50% of the “normal cost” of teacher pensions, or $136.6 million, to counties starting in FY 2013. This would increase to a 100% shift in FY 2016. The normal cost is the amount required to pay pension liabilities if the system had not been underfunded.

For more information on the budget proposal and the special session, including a video of O’Malley’s announcement, please see the Gazette article.

The General Assembly did not pass a tax bill prior to the conclusion of the legislative session on April 9th. This means that the state is scheduled to automatically go into FY 2013 on July 1st using the “doomsday” budget, which includes a $512 million cut for education, libraries, public safety and other programs. (For more information, see the earlier blog post.) If the General Assembly votes in favor of this new proposal, the state would not implement the “doomsday” budget.

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