Maryland Gov. Moore reveals balanced budget proposal

Maryland's budget challenge turns a new page as Democratic Gov. Wes Moore reveals his $70.8 billion proposal that seems to solve a $1.5 billion shortage without much taxpayer stress.

"This budget does not raise taxes or fees on Marylanders," said Moore. "This budget maintains a very healthy 8% in the rainy-day fund. This budget maintains a minimum cash balance of over $100 million."

The proposal was released on Wednesday and rolls in changes to the state's finances unleashed by the Trump administration.

"Since January 2025, federal employment has fallen by nearly 25,000 jobs in the state of Maryland, which, by the way, represents more than any state in the entire country," said Moore.

"Then come the cuts from Trump's One Big, Beautiful Bill, his cuts to our federal partnerships, which then turn around and put us right back in the hole, altering Maryland's budget and our balance sheet by hundreds of millions of dollars."

Solving the gap is partially achieved by moving $322 million from the state's capital budget to the general fund.

Some bonds will be swapped for cash, and the budget assumes that $50 million in revenue bonds will be issued by the University System of Maryland to support higher education facilities.

The state's fiscal responsibility fund will transfer out $187 million, $150 million will be siphoned from the local income tax reserve and a $145 will be cashed out of reserves.

The state's Acting Secretary of the Budget and Management Department, Yaakov "Jake" Weissmann believes the moves will shore up relations with the credit rating agencies.

"It's a constant thing that we hear from our bond rating agencies, our partners and other outside observers," said Weissmann. "Maryland must balance our budget, and this year is no exception."

Democrats retain control of the Maryland General Assembly which needs to sign off on the final version of the budget. The opposition is already staking out positions.

"While the governor's budget avoids new taxes and fees at first glance, there is a lot beneath the surface that gives us pause," said Senate Minority Leader Steve Hershey.

"The proposal shifts additional responsibilities to counties and municipalities, putting local governments in a position where higher local taxes become more likely. It also relies on moving and raiding funds to support ongoing spending."

The proposal includes shifting 50% of the retirement costs for K-12 education, community colleges and libraries to local jurisdictions.

The proposal charts public debt going up 6% from 2026 to 2027 but only accounting for 2% of total expenditures.

After several financial challenges the state seems to be on an upswing.

Last week Gov. Moore and U.S. Department of Transportation Secretary Sean Duffy signaled the burial of a hatchet as they teamed up on plans to rebuild the Francis Scott Key Bridge in Baltimore Harbor.

Earlier this month Maryland scored a AAA rating on its general obligation bonds from KBRA.

Maryland's bonding ability took a hit last May when Moody's Ratings downgraded the state's issuer rating and general obligation bonds to Aa1 from Aaa.