One good thing about raising the roof is that it provides a good look at what is inside.

The Baltimore Sun reported late Monday that State officials, disregarding the current economic crunch in Maryland, voted to raise the two-decades old the debt limit, allowing borrowing for schools, construction and roads.  Facing weak tax revenues, the O’Malley administration warned that the failing to raise the debt ceiling would require delaying over $800 million in planned construction and other State projects.

In short, despite the dire economic forecast, O’Malley continues to push his spending agenda, making certain that there are adequate monies for his personal project fund.

At least Comptroller Peter Franchot showed some good sense, casting the sole dissenting vote of the five-member Capital Debt Affordability committee.

“I get the need for new capital improvements, but I also think the state and the country are at a particularly perilous moment right now. We have a responsibility to put the brakes on.”

(more…)

Matthew Brown of the Baltimore Sun reports (”O’Malley calls Md. budget a ‘model of responsibility” August 1, 2008) that Governor Martin O’Malley recently touted his administration’s 2008 budget fix as a national model for the “American value of fiscal responsibility.”

Apparently, O’Malley believes that his plan will allow the state to “close a $1.7 billion projected gap between spending and revenue while increasing funding for school construction, health coverage and other administration priorities.”

But, according to the National Conference of State Legislatures report released last week, Maryland faces at least an 8% gap between expenditures and revenues for fiscal year 2009, despite a whopping $1.3 billion dollars in new taxes in 2008.

“We expect it to get worse before it gets better,” Corina Eckl, fiscal-program director of the National Conference of State Legislatures. The conference’s new report describes the shortfalls states face in their budgeting process for the current fiscal year, which began in July.

According to the Wall Street Journal (”States slammed by tax shortfalls” July 24, 2008)

[t]he stumbling U.S. economy is forcing states to slash spending and cut jobs in order to close a projected $40 billion shortfall in the current fiscal year.

That gap – identified…in a survey by the National Conference of State Legislatures — is more than triple the size of the previous (2008) year’s. It is the result of broad economic weakness at the state and local levels that could cause pain throughout this year and into 2010. Sales-tax collections, for example, have been hurt by the housing slump and high gasoline prices, which are prompting cutbacks in consumer spending. Personal income-tax collections have been hit by rising unemployment, while corporate income-tax collections have been eroded by falling profits.

Maryland is not alone in its struggle to balance its budget.  And no doubt every governor has his own “administrative priorities.”

Apparently, one of the O’Malley administration’s priorities in managing the burgeoning budget shortfall is the recent hiring of sports promoter Terry Hasseltine.  According to the Baltimore Sun (”Sports promoter hired to lure events to Maryland” August 8, 2008),

Hasseltine, whose title will be director of sports marketing,…will report to Hannah Byron, who heads the state Department of Business and Economic Development’s division of tourism, film and the arts. He expects to regularly consult with the Maryland Stadium Authority.

Hasseltine said his appointment might be the first step toward a bigger marketing operation.

“My goal and objective is [to] identify whether a full-fledged statewide sports commission makes sense for Maryland and, if so, what is the structure,” Hasseltine said.

Creating a “sports commission” with state monies demonstrates “American value of fiscal responsibility”?  Whatever happened to the American value of work before play? 

Rather than focusing on increasing the corporate tax base and developing an economic climate favorable for creating new business and jobs, the O’Malley administration chooses to focus its attention on investigating providing more opportunities for sports and entertainment.

But with more and more Marylanders facing, at best, decreases in discretionary income due to rising taxes, fuel and energy costs and, at worst, potential job losses associated with the flight of businesses from Maryland, the O’Malley administration shows little interest in attracting greater corporate presence and capital investments in new businesses or in retaining many of the small businesses that currently operate in Maryland, as evidenced by the 2008 increases in taxes. 

And in a time of economic belt-tightening, more sporting events in the area are unlikely to produce a ready supply of revenue to ease the current or forecasted budget crunch.

While “you gotta play to win” may hold true for the Maryland lottery, you gotta work to live.  Which might explain why so many Maryland residents and businesses are moving elsewhere.