March 27, 2010

House committee rejects teacher pension shift, other Senate budget actions

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By Andy Rosen
Andy@MarylandReporter.com

The House budget committee roundly rejected a Senate proposal to hand off half of the state’s responsibility for teacher pensions within five years, one of a series of decisions that will lead to difficult negotiations between the two chambers.

The House Appropriations committee unanimously rejected the change, and also scaled back a plan to divert state and local highway money toward general expenses. Those changes were two major components of the close to $32 billion spending plan the Senate passed this week.

The House and Senate also are at odds over how much to dedicate to stem cell research and whether to take money from the reserves of the state’s worker’s compensation fund. The House committee also eliminated the legislative scholarships that are popular perks with the senators, as MarylandReporter.com reported.

The Senate action on teacher pensions and highway funds would have had little impact on this year’s budget, but they would have ultimately lopped off half of a $2 billion ongoing deficit. However, both proposals would have been hard on county governments that, like the state, are struggling with revenue drops. The House committee’s budget plan takes less from local governments.

The committee rejected the pension shift without discussion, but Del. John Bohanan, D-St. Mary’s, later said members had discussed the change after the Senate action.

“I think there’s a strong sentiment that it’s hard to do that with a short amount of time here and not a lot of notice to the counties,” he said. “If we’re going to do something like that, we have to do it comprehensively.”

In what has become an annual battle, the House and Senate are again differing over how much to put into the state’s stem cell research program. The Senate had voted to cut Gov. Martin O’Malley’s proposal from $12.4 million to $6.2 million for fiscal 2011, but the House voted to maintain the cash.

The two chambers also disagree on whether to take $20 million from the Injured Workers Insurance Fund. The Senate rejected the fund transfer last week, but the House committee voted to take the money for the general fund.

Analysts said the transfer would leave $267 million in IWIF’s reserve, but opponents wondered whether the transfer was the best use of the money.

“It’s really not our money. It belongs to businesses in the state of Maryland,” said Del. John Wood, D-Charles and St. Mary’s. “They’re the ones who paid it in, and they’re the ones who need help.”

The House also wants to reverse a Senate demand that the Maryland Transit Administration go back and study different options for the Red and Purple Line projects now being considered for Baltimore and the Washington suburbs.