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Panel OKs Maryland Budget With Cuts, Not Revenue Hikes

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Darcy Spencer has the latest on a push to expand slots and table games to Prince George's County, which got of committee and headed to the House floor Monday.

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A panel of Maryland lawmakers agreed Monday on a bare-bones budget bill that contained spending cuts but not revenue increases, as the General Assembly ran short on time to reach agreement on two different income tax proposals before the session's midnight adjournment.

Although they have not been able to agree on new revenues to avoid unpalatable cuts, negotiators at least have a balanced budget measure to send to the House and Senate floor for final votes. That means the session would not have to be extended if the two chambers pass the bill before midnight.

Members of the House and Senate conference committee were still trying to iron out differences on proposals to raise income taxes to help close the state's budget gap.

“Well, we haven't agreed to a revenue bill, so we signed the budget bill that has a contingency of $250 million of cuts unless we can agree to a revenue bill tonight, and time is running out to do that,” Sen. Edward Kasemeyer, a leading negotiator, told senators early Monday evening. “So, we're trying to reach some accommodation to a revenue bill.”

Negotiations on the revenue package that raises income taxes on people who make more than $100,000 are stuck over whether to reduce tax exemptions on federally adjusted gross income for people who make less than $100,000 a year from $3,200 to $3,000. The House opposes it, and the Senate is pushing to reduce it for three years.

In theory, a special session could be called to take up parts of the failed budget package to avoid widespread spending cuts, if those don't pass before midnight.

As the budget bill was signed without the revenue part, most members of the House and Senate negotiating teams sat with glum expressions in the small room where they have been meeting during the last week.

Meanwhile, a House committee revived a measure to expand Maryland gambling laws late Monday afternoon. Members of the House Ways and Means Committee passed a stripped-down version of a Senate bill that would legalize table games at five casino sites and clear the way for a sixth future casino, in Prince George's County. The measure, which would require statewide voter approval, would prohibit the state tax on slot machines from exceeding 60 percent and require the state to hire a consultant to study the impact of future gambling in Prince George's on existing casinos.

“I think it's a giant step in the right direction,” said Prince George's County Executive Rushern Baker, who has pushed for the development of a $1 billion casino at the National Harbor development in his county.

Prince George's voters would also have to vote in favor of the measure in order in order for the new casino to be built.

The closing hours of this year's legislative session have been unusual because of the lack of agreement on the budget in the session's waning hours.

Lawmakers are trying to balance the books for the next fiscal year and cut an ongoing $1.1 billion budget deficit in half. The ongoing deficit will resurface in future years unless lawmakers take budget actions that continue beyond simply the next fiscal year. Gov. Martin O'Malley's budget proposal was significantly changed by both the House and the Senate.

On Monday, with time running out, finger-pointing from the presiding officers characterized the first part of the afternoon. House Speaker Michael Busch blamed the Senate for foot-dragging in hopes of getting an expanded gambling measure through.

“If the budget of the state of Maryland goes down and the senators are more concerned about the obsession with gaming than they are with school construction, school funding, higher education money, then let them wear that when they go home and tell their constituents why they had to spend extra time in Annapolis,” Busch told reporters earlier in the day.

Senate President Thomas V. Mike Miller contended that the House wasn't going far enough in the income tax plan backed by senators to adequately address the state's running deficit in future years.

“There are those of us that understand that we have a structural deficit that has to be dealt with,” Miller said. “You can't keep owing, owing, owing, owing and owing.”

While the budget negotiations created an obvious distraction, the General Assembly worked to pass other measures.

Lawmakers passed a bill to double the state's “flush tax” on sewer bills from $30 to $60 a year to pay for upgrades to wastewater treatment facilities.

They also gave final passage to a bill that limits where new septic systems can be installed, a priority of O'Malley's. The measure creates a four-tiered system that limits where developers can build residential subdivisions that use septic systems rather than public water and sewer services.

Some high-profile measures faced uncertain prospects.

O'Malley's offshore wind measure appeared to be in jeopardy, as even supporters gave up on the bill. The measure, scaled back significantly from a bill that failed last year, has sailed through the House, but the Senate had not voted on it as of early Monday evening.

The Senate, on a 26-20 vote Monday, approved a measure that is designed to help foster public-private partnerships on big projects such as roads and public buildings. The bill is the same proposal that O'Malley's administration submitted. The House of Delegates made some significant changes to the bill earlier this session to allow legal appeals to be heard on an expedited track before the Court of Special Appeals, the state's intermediate appellate court.

That provision would be retroactive to apply to the State Center project in Baltimore. The change brought criticism from some lawmakers who said it would confer special legal benefits for certain companies. The differences between the two bills will need to be worked out before Monday's midnight adjournment.

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