Budget Woes in Maryland

Budget revenues are down in the state as a result of a faltering economy, and so the Governor is considering mid-year fiscal 2009 budget cuts. Governor O'Malley will propose approximately $300 million in budget cuts. The Sun has highlighted a list of these possible cuts.

The Sun reported that the USM will receive about $30 million in cuts, $10 million from the base operating budget and $20 million from the "cash-on-hand" fund balance. Community colleges are set to receive $16.3 million and independent colleges will receive a 25% cut of state funds of 8.4 million.

While it seems like the USM is taking a significant cut, we are fairing well in the broad picture of cuts. The USM encompasses 22% of "unrestricted funding" of the state budget, and will only take about 11% of total cuts.

Of course, the Governor may very well propose additional cuts beyond these estimates tomorrow in his final proposal, considering the recent decline in the economy. Also, revenue estimates may be down again later this year--we should embrace to consider further midyear budget cuts down the road.

On a related note, the Chronicle of Higher Education has written a story about the USM's unique strategy of cutting the fat in the budget and increasing efficiencies through the Effectiveness and Efficiency Initiative. Legislators have commented that this strategy has increased their trust and confidence in budget proposals from higher education.

Presidents of USM institutions will be faced with tough decisions after tomorrow when the first round of budget cuts are approved.

**Also note an article in the Diamondback highlighting a report from the Department of Legislative Services yesterday, which recommended that policymakers seriously reconsider another tuition freeze.