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ANNAPOLIS — House Republican lawmakers on Thursday mapped out an extensive plan to freeze spending and roll back tax increases to balance a state budget that may be $1 billion in the red by the time lawmakers return to the State House in January.
The proposal would provide $3.8 billion of tax relief over the next four years, hold the line on spending growth and adopt a slots bill that would provide an estimated $850 million infusion of cash up-front through licensing fees.
Republicans also stated their opposition to the constitutional amendment that will be before voters in November to bring 15,000 slot machines to five locations across the state.
Democrats were quick to blister the GOP plan for offering few specifics on where to make reductions.
"It's a joke," said House Majority Leader Kumar P. Barve (D-Dist. 17) of Gaithersburg. "Unless you have specific budget cuts, then it's meaningless. They need to have the guts to tell us precisely where they are going to cut spending."
But House Minority Leader Anthony J. O'Donnell (R-Dist. 29C) of Lusby refused to offer details, saying that Democrats need to come to the table and work together to solve the budget crunch.
"Our priorities may be different than their priorities, but we're willing to talk about it," he said, pointing to some of the GOP's prior recommendations to eliminate funding for vacant state jobs, reduce the state's vehicle fleet and trim executive-level salaries.
Democrats have accepted GOP recommendations in previous years to reduce spending, Barve said, and welcome suggestions going forward.
"The governor is working together with everyone to come up with budget cuts to solve the revenue issues," said Christine Hansen, press secretary for Gov. Martin O'Malley. "If anyone knocks on his door and wants to sit down with him, he's willing to sit down with them."
The largest ingredient of the GOP's plan is rolling back the 20 percent sales tax increase that lawmakers passed during last year's special session. Under the proposal, the sales tax would drop a half point to 5.5 percent in fiscal 2010 and would hold steady at 5 percent beginning the next year, providing $2.7 billion in taxpayer savings.
Republicans also want to bring the corporate income tax back down to 7 percent by 2012, which would result in an estimated $473 million in tax relief. The proposal would also repeal the restructured income tax code and a higher car titling tax, which total nearly $700 million in tax relief.
Overall, the GOP plan would provide an estimated savings of $1,750 to average Maryland households, they said.
Barve scoffed at the proposals because it would take money out of state coffers without a dependable revenue stream to replace it at a time when the national economic crisis could result in further revenue writedowns.
The GOP proposal to freeze general fund spending for fiscal 2010 would save more than $850 million, Schuh said. Over four years, slower growth in spending will save $4.4 billion.
"We cannot continue to spend to prosperity," O'Donnell said. "We must only start government programs and spend citizens' money as stewards of the public trust in a way that is responsible."
Important government programs may have to be scaled back if the money is no longer there to support them, said Del. Adelaide C. Eckardt (R-Dist. 37B) of Cambridge.
"You give it with one hand and you take it back with the other," she said. "This new plan will stabilize the situation so it's sustainable."
The Republicans announced Thursday the caucus opposes the Nov. 4 slots referendum, because the GOP believes gambling doesn't belong in the state constitution.
However, the caucus would seek to pass legislation in 2009 that would place 15,000 machines at six undetermined locations. The machines would be privately owned and be subject to government oversight.
Auctioning the licenses for slots terminals would net the state $850 million for fiscal 2010 and the annual revenue once fully implemented is projected to be about $1.3 billion, $68 million a year less than projected under O'Malley's p an.
"If [the referendum] fails, we have the right to come back with a superior plan," O'Donnell said.
But Barve said no potential slots license-holder would give away so much money up front with no revenue guarantees. "You don't even need to have a degree in accounting to understand that," he said.
