ANNAPOLIS – The Maryland Board of Public Works cut an additional $364 million from the fiscal 2010 operating budget Wednesday, pushing the total reductions to $1.1 billion since the fiscal year began in July.

The biggest reductions in this round of cuts were made to higher education and Medicaid payments to hospitals.

The Department of Health and Mental Hygiene has endured roughly 31 percent of the total budget reductions this year, and was not spared in the cuts made Wednesday.

More than $55 million was cut from Medicaid, $11 million was taken from mental health services and almost $21 million was cut from the Maryland Children’s Health Program, the state’s Children’s Health Insurance Program (CHIP) initiative, based on lower-than-expected enrollment.

The Board of Public Works cut $25 million from the University System of Maryland and $7 million from the Sellinger Program, which provides aid to independent higher education in Maryland.

The state also eliminated 112 government positions, more than half of which are currently occupied.

Martin O'Malley

After unprecedented reductions, this year’s general fund budget is $500 million below what it was four years ago.

“I don’t believe that anybody on this side of the (Great) Depression can find a time when that actually happened,” said Gov. Martin O’Malley, who serves on the board with Comptroller Peter Franchot and Treasurer Nancy Kopp.

O’Malley added that “today’s actions are not the end of this,” as the state faces “a lot of tough decisions” to prepare for its 2011 budget.

Nearly three-fourths of these latest cuts are one time only, meaning the state will have to make reductions again to meet next year’s budget shortfall, which the state expects will exceed $1.5 billion, according to Eloise Foster, secretary of the department of Budget and Management.

Still, Maryland has planned ahead by saving its stimulus money. It’s one of eight states that plan to save more than half of the funds allocated by the federal government through the American Recovery and Reinvestment Act.

Since O’Malley has been in office, the state has made $4.6 billion in spending reductions and eliminated 3,300 positions, according to the Department of Budget and Management.

The scope of the cuts concerned Franchot, who cautioned against taking too much from any one section of the budget, saying the board could exceed its power by “getting well into policy.”

“I think we need to be careful when we move forward because we’re not a mini-legislature, we’re a board of public works,” Franchot said.

- Capital News Service