Transparency has been a controversial issue for Cambridge Waterfront Development Inc., the entity responsible for the Cambridge Harbor project. The City Council and citizens alike have complained in the past about CWDI’s opaque dealings and lack of communication with the public. So, it was appropriate, and likely inevitable, that the issue arose during the January 15th meeting of the CWDI Board of Directors at the Dorchester Chamber of Commerce.

As if anticipating this, CWDI President Angie Hengst addressed it during her opening remarks. After mentioning the December 19th groundbreaking for the Cambridge Harbor promenade, she said that the board had “talked about some planning for public information sessions throughout 2025 just to keep the public informed. Obviously, they can come to our meetings, but maybe some more specialized meetings talking about various parts of the project. But, you know, we really want to keep the public abreast of what’s going on so they feel part of the project and know where we’re headed. So we’ll be looking into planning some of those for the year and then some possible community events.”

Later, after board member Frank Narr discussed profits and losses due to last year’s litigation, the beginning of construction on the promenade, and predicted property sales, his colleague Tim Crosby inquired about the public’s involvement in decisions about the design and development of the Harbor project.

“Because it’s been two years since the public input side of this was a very active role, right?” asked Crosby. “And there are different stakeholders out here. Some are community based, some are based by ethnicity and things like that. Are we going to exert a particular effort to those communities and say, ‘Okay, look, here’s where we are. What do you think and what are we missing before we get too far down this thing?'”

“So where a particular commercial entity goes or whether residential goes or where hotel goes is still subject to a response from a developer,” Narr responded. “So, you know what the community may say, if the community says how we think of hotels here, it’s really the market’s going to kind of drive where those things go.”

Crosby agreed that the citizens can’t really have a say regarding the major parts of the project, but he said “there’s an awful lot of small pieces that can have a direct impact on certain communities that I think I just want to get out and communicate with. The more we communicate, I think the better off we are.”

Hengst then said, for the benefit of the audio recording and the citizens present, that the public is encouraged to reach out to city and county representatives with comments and concerns. “So, that’s another way for the community to voice their thoughts along the way.”

When the meeting was turned over to the public for comments, new resident Stephanie Willett pointed to Crosby’s remarks about communication and mentioned how important that is. “Passive communications, putting information out there, is not always good for a lot of minority communities. I haven’t caught up with everything that’s been going on, but to the extent that you all can get out and get into some of these communities and share your faces and show that you’re willing to be engaged with them. Relationships are very important.”

Jennie Leichtling of Mill Street, whose background is in fundraising development for nonprofit organizations, proposed that public communication can manifest itself in more ways than just talking or sending messages.

“The one thing that I am hearing a lot of is ‘if you build it, they will come,'” said Leichtling. “You need to build the community first, and you need to make sure that what you build reflects what the people want. And so, I’m hearing really responsible building stuff, everything that you guys are doing the research for, the capital investments, I think it all sounds great, wonderful. What I would propose adding in addition to this is doing kind of consistent community development and not just at meetings, but on the location.”

For “the location,” Leichtling focused on the playground next to the Visitor Center. She suggested bringing in a coffee cart or food trucks, installing picnic benches, and building a beach volleyball court.

“Because,” she said, “we need to continually invite the community to that space. Because I think the more we invite them, the more we’ll see how the community wants to use that space. Because, until we actually get the community there, we don’t really know what they’re going to actually do.”

“We’ve definitely had conversations of how we can get the community out there and start utilizing that space more, and they’re all wonderful ideas,” Hengst replied.

Since Mayor Lajan Cephas, City Commissioner Sputty Cephas, and City Manager Glenn Steckman were present at the meeting, along with several concerned citizens, one could say that communications are open and the conversation has begun. The next CWDI board meeting is March 19 at 4pm. For those interested in keeping up with the project or who want to contact CWDI, go to Cambridgeharbor.org.

The Cambridge Association of Neighborhoods (CAN) is dedicated to encouraging and assisting community members to be good neighbors. They strive to enhance the safety, quality of life, and well-being of Cambridge’s residents as well as promote code-compliant housing, social events, and community involvement in the city. CAN is open to both renters and homeowners, and newcomers are invited to join and help make Cambridge an even better place to live. Anyone interested can find out more at cambridgecan.org.

CAN President Chuck McFadden recently sat down to tell the Spy about the organization’s origins and plans going forward. (His answers have been edited for length.)

How did CAN get started?

Well, I joined the old civic association, the West End Civic Association, WECA. And they were kind of dying out, and I tried to get some things going and had some disagreement with some of the board members.

You remember when this was?

2016.

Oh, okay. So, it’s pretty recent.

Right. And there was a long time and work. They’ve done some really nice stuff. They used to do a walk on High Street and explain all the history of High Street, but they were getting older and were not into “come-heres.” Okay, so they liked it “from here.” So anyway, after some frustration, there I was, standing out on my lawn across the street. I used to live right across the street, and talking to Judd Vickers and Dave Thatcher and Roman Jesien. And, on the lawn, we decided to start a new association, and Roman came up with the name Cambridge Association of Neighborhoods, CAN.

So, that’s how we started, and the idea that we originally started with was just to try to develop neighborhood feelings within different blocks of the West End and try to organize the blocks into neighborhoods so people would know each other and then try to help each other out and just be nice. We helped people take down a fence, we took down a shed, we painted a porch, stuff like that, trying to help out our neighbors. And we used to do a big summer CAN Jam down at Long Wharf. And that all was a nice feeling. And it was definitely Ward 1 focused. And then COVID hit, so we couldn’t have big group gatherings, we couldn’t get together.

Everything was the Zoom meetings. And we evolved during that, into more of a organization that reported on what was going on. So, we report on the City Council, County Council, [Historic Preservation Commission], school board, planning and zoning, number of government stuff. So, that function that we do there is pretty well received, and people like knowing what’s going on with the different government stuff. We also advocate for different positions, especially in the zoning and code enforcement area. People don’t feel like they’re getting a response from the city, they contact us and we get involved and try to see what we can do.

What do you do?

Well, we contact the city and try to put pressure on, and we have a fair success rate in getting the city’s attention. We have gotten the city’s attention several times at board council meetings and stuff like that. We have flooded the council building with people. So, instead of just one person speaking, when they see 20, 25 people, it’s a different look. But it’s a pressure technique that only works once in a while. You have to be careful in using that. You’d rather just have conversations with the city officials and say, “You know, why don’t we do this and that?” So, it’s important to us to get the feel of what our members want. We have over 800 email addresses and we figure over 1100 members’ emails. Like this household: there’s only one email, but there’s my wife and I. So we’re figuring around 1100. I think that’s conservative, probably higher than that that we reach.

And I think one of the things people like is that we do it through email. So, we contact them through their email and they can either look at it or not. But part of the problem the city has getting the information out is they don’t have a vehicle like they used to have in the past. So, they put it on the website, but nobody knows where it is on the website. Nobody knows it’s posted. They’re trying to make an announcement, but nobody knows it’s there. So, how do they get it out? Cambridge is 13,000 people. Four to 5000, maybe a little bit more, are children. So, seven, 8000 adults are trying to get to and how do you do that?

Is the format of your meetings different than when you were starting? How did you do it when you started out?

Well, we would have members’ meetings and we would invite the mayor or a council person or the police chief to speak, somebody of interest. We’ve had the superintendent of schools, we’ve had Larry White, who’s doing the Shoreline Resiliency Project. We’ve had a number of people more than once to talk about their projects or their area of interest or what’s going on or what the future holds. And that’s received fairly well, although we would like more attendance and, as you’ve been to many a meeting, we could use more people there. I’ve pondered about, with as many members that we have, why can’t we get more active participation at members’ meeting? We’d like to get more people at the meeting and we’d like to get a more diverse crowd at the meeting.

Like, more than just Ward 1.

Well, yeah, but in terms of race. [Cambridge] is 50-50 and we’re not getting 50-50. An interesting thing happened. We used to charge $20 a year to be a member when we first started out and we hovered around 60 to 80 members. And then we decided to drop the membership fee and, as you can tell by the numbers, that was worthwhile. We really increased our membership and contributions. We ended up about the same as and we don’t spend a lot of money.

What do you use the money on?

Well, meetings and stuff, advertising the meetings, filming the meetings. We had to rent any room space when the library closed down. So, that kind of stuff. So, we’d like to get more diversity. An interesting thing is that we used to be primarily in Ward 1. Now we’ve got a lot of members in the outlying section, the new area next to Long Wharf and all around. And we’ve done some stuff. In fact, the last city manager put $15,000 in the budget to fix little things that we brought up. We went down to him for Blackwater Landing, behind the Dollar General Store, and they wanted a fence put in and they couldn’t get the city to pay attention. We went down and talked to the city manager and he agreed to put a fence in and he said he wished he’d done more about it because it really didn’t get to him, the request. So, he put 15,000 in the budget for stuff like that. The people brought it to the attention, not just CAN, but anybody bringing stuff that they had a little flexibility to do, minor stuff, you know, okay, which we thought that was listening to the public.

So, what other activities is CAN involved with?

Well, we’ve got several subgroups. We have one on [Cambridge Waterfront Development, Inc] that follows what they’re doing and trying to dig in and figure out what’s going on there. We have another subgroup that’s concerned about Cannery Park and what’s happening and not happening there. And I just met with the city manager on the marina committee.

So, what are CAN’s plans for 2025?

Well, right now we’re in the process of developing our priorities. We had a meeting in December to talk about priorities, and what came up was One, the publication of minutes is the most important issue that we do the reporting on. CWDI was Two, code enforcement issues is Three. And then it gets a little difficult because it depends on how many people we have to work on it. And we got some people working on the Cannery Way, which is a wonderful project. And there’s money for Cannery Park and the bike trail, but there’s not an overall concept. So, we’d like to come up with ideas. It could be a very nice project. So, CAN would like to get involved and get some issues going there. And of course, Cambridge Harbor. CAN was very opposed to the Y[MCA] moving down there. We had a survey, we had 680-some people respond to the survey. 85% were opposed to going down. And the main reason, the nonprofit going into what everybody considers the economic engine of the city. This should generate money through taxes and stuff, and you’re putting a nonprofit right in the middle of it.

Second, they were concerned about what was going to happen to the vacant school building where the Y is now. That’s the two big ones. But then you have the other ones like the safety issue of people getting to the Y, especially the youth. It’s right on the edge of the city instead of in the middle of the city. So, we’re very opposed to that. We’re opposed to building a 125-foot slip marina in there, which would be in direct competition with the city marina, which right now is only at 60% capacity. So it’s like, what were the city planners thinking? And the answer to that is there was one project at a time. There needs to be overall planning going on for the city. And it’s that feeling of frustration that our members have given us that we try to pass on to the city. I mean, I just met with the city manager yesterday and talked about exactly that. You need overall planning of what the city’s going to do.

What are your hopes for the future of CAN?

We’d like to see more diversity. And one of those things we’re going to be working on next year is how do we find out what people want and what they don’t want. It’s a difficult thing. And you know as a reporter, you get people who speak out, you can hear those opinions, but you don’t know what everybody wants. And I think CAN is probably one of the better methods of getting. So we have the capability of doing very sophisticated surveys and you can’t overuse that. But we’d like to use it more to get people’s temperature on different topics. A woman, Kim Miller, who is taking over as secretary, has a statistical background and knows how to do surveys and knows how to read the surveys more importantly when they come in and how to do the questions so you get the answers that you’re looking for.

Efforts to bolster Maryland’s flagging economy and ease projected budget deficits may hinge on improving the state’s transit and road systems.

But the fund that pays for roads and transit is projected to have a more than $1 billion shortfall over the next six years, and lawmakers will return to Annapolis next month facing the prospect of “enormous” deficits in other parts of the budget.

That was the challenge laid out recently at a conference of state officials and business leaders, who said efforts to grow the state’s economy may depend on improving the state’s transportation system.

“Investing in Maryland’s transportation network will make the state more attractive to business,” said David Smith, head of government affairs for Martin Marietta, during the symposium last month held by the Maryland Chamber of Commerce.

A debate about tax increases that began earlier this year is sure to resume when the General Assembly convenes in January. Gov. Wes Moore (D) and Senate President Bill Ferguson (D-Baltimore) have so far rejected broad-based tax increases, favoring a focus on growing the state’s economy.

But the state’s economy is stagnant. The operating and Transportation Trust Funds are in the red.

Smith pointed to a July CNBC ranking of top states for business, in which Maryland ranked 31st overall and 37th for infrastructure. By comparison, Virginia ranked first overall and third for infrastructure. Pennsylvania ranked 17th overall and 20th for infrastructure.

Del. Marc Korman (D-Montgomery), chair of the House Environment and Transportation Committee, said employers “want to be near transportation that works.” But even the systems already in place in the state are struggling.

“A great example is the Light Rail system in Baltimore City, which is being held together by MacGyver with duct tape and chewing gum,” Korman said. “It could be a really great transit option for lots of businesses, if you get it working and get better service again. So, if we can create those opportunities around the state, we’re in a great position.”

Maryland faces an “enormous” projected operating budget deficit. Recent estimates predict the gap between revenue and spending will be $2.6 billion in the coming fiscal year, and approach $6 billion by fiscal 2030.

“Budget deficits are an inherent reality of government,” Lt. Gov. Aruna Miller (D), told attendees of the half-day conference. “Make no mistake on that. In fact, 18 of the past 21 state budgets had built-in deficits, underscoring the balance between making critical investments and maintaining fiscal responsibility.”

Much of the gap, especially in the out years of the Department of Legislative Services projections, is driven by higher costs of the education reforms in the Blueprint for Maryland’s Future.

Coupled with the operating budget gap is another, more than $1 billion, gap over six years for transportation projects.

Any solution for transportation funding would have to come with solutions for paying for the costs of the Blueprint, according to Korman.

“I know, at least speaking for my colleagues in the House of Delegates, if I can be so bold, that is a big issue,” Korman said. “We are not interested in solving one very important part of our economy, which is transportation, but not another, which is education. And so, these things all have to be done together.”

A derailed TRAIN

Earlier this year, when the House and Senate clashed over tax plans, the House wanted to abolish the Transportation Revenue and Infrastructure Needs Commission —  the TRAIN Commission — before the panel handed over a menu of options to modernize the Transportation Trust Fund.

Instead, the two chambers dissolved the original 31-member panel and reconstituted it as two panels: A smaller commission that would author a final report by January and a second, larger panel composed mostly of advocates, to advise the commission.

Lawmakers called on the panel to deliver a final report before the 2025 session, but that’s unlikely to happen. Members of the two new panels have not been announced. The groups have yet to meet, and the window for meeting is closing as the holidays approach.

Frank Principe, chair of the original commission, said solutions will require the governor and legislative leaders to reach some consensus on options.

“I think that the low-hanging fruit is pretty limited,” Principe told the chamber audience. “The bigger changes and needs for resources that we’re going to need to get to where we want to be requires us to make bigger and bolder steps. And I think that’s just political will to do that.

“The TRAIN Commission is more than happy to create menus of options and opportunities for conversations around what we need and what could potentially bring the resources that the department needs to be able to move on projects that we all agree need to happen,” he said. “But that really starts at the top. Without that direction, it’s going to be hard for us to get us where we need to be.”

Miller and others are looking to Principe’s panel for options.

“Currently, yes, we do have a funding shortfall that is driven in part by many different factors, including the less-than-expected revenue for the state gas tax, reduced federal funding and an end to the federal COVID-19 aid and increased construction costs,” Miller said. She said the TRAIN Commission, is making recommendations to stabilize funding.

Modernizing the Transportation Trust Fund will likely rely on several options working in concert with each other, according to Cinzia Cirrillo, director of the Center for Multimodal Mobility at the University of Maryland.

“So, there are ways that have been adopted to supplement the revenue for transportation,” Cirrillo said. “And as I tell my students all the time, in transportation, one solution is not going to work. It’s a bundle of solutions that will help raise the money that we need in transportation. And unfortunately, for transportation projects, you need a lot of money.”

Principe said there are “more choices to be made than resources that are available,” when it comes to a menu of funding options.”So, at the end of the day, we’re going to have to figure that out.”

Regional authority, local responsibility

There is plenty to figure out.

“I think that the key question is, do we want to stick with our current statewide model, or do we want to shift to regionalization?” Korman said. “I think that’s a pretty big conversation.”

But Korman said regionalization comes with a different cost for local governments.

“I think realistically, if the state was going to hand the counties additional authority, it would probably hand them additional responsibilities,” Korman said, adding that state officials would “not just give away taxing power without asking them to take on obligations.”

Other solutions could include regionalized taxes based on proximity to transit systems in the area, according to Korman.

Another possibility that is fraught with potential problems is a tax based on miles traveled — a vehicle miles traveled tax. Four states are currently piloting such programs.

Currently, the majority of transit and road projects around the state are paid for through the Transportation Trust Fund, a dedicated account funded by various registration fees and taxes, with most of its funding coming from the state’s motor fuel tax.

The state started 2024 with a proposed six-year plan that cost $3.1 billion more than the fund could support. Transportation Secretary Paul Wiedefeld later revised that projection to a smaller — but still sizable — $1.3 billion over the six years.

“There’s these tremendous pressures on the state’s revenue sources,” Wiedefeld said. “I think there’s a much greater understanding of that.”

The lack of money means projects requested by the state’s 24 political subdivisions could be delayed or even paused indefinitely.

“The problem we have is whether you’re like me and want to see three Purple lines, or like some of the other folks here and want to see three new Beltways, American Legion Bridge improvement with the Red Line … or a new Bay Bridge — whatever it is you want to see, we don’t have enough money for any of it. That’s obviously the challenge before us,” Korman said.

By Bryan P. Sears

– Maryland Matters reporter Bryan P. Sears was an uncompensated moderator of a panel during the Maryland Chamber of Commerce transportation symposium.

Oyster harvesting in Maryland’s Chesapeake waters on public bottom opened for the 2024-2025 season on Oct. 1. Hand tongers got the first crack at this year’s crop of market-size oysters since the season for power dredging doesn’t open each year until Nov. 1. The open season continues until March 31, 2025.

There’s nervousness on the water because the new season opens against the backdrop of two wildly different past two seasons.

According to state statistics gathered from oyster buyers up and down the Bay, Maryland’s watermen harvested and sold 722,850 bushels of oysters during the 2022-2023 season with an estimated dockside value of $31,241,577. The following 2023-2024 season’s numbers showed a harvest of 437,536 bushels with a dockside value of $15,528,786, a dramatic decrease.

Curiously, despite a large increase in the number of individuals reporting catches in the 2023-2024 season compared to the season before – 649 vs. 415 – the results in bushels harvested and their dockside value were much lower. It turns out that the high harvest and sales in the 2022-2023 season, that drew so many more individuals into the harvesting the following year, was an outlier.

Relative to the recorded harvests over the past 25 years, the 2022-2023 harvest represented a huge spike. A radically fluctuating market appears to be the dominant factor.

The decline the following year didn’t occur because the volume of oysters in the Chesapeake went down. Strong spat sets over the past few years have resulted in expanding oyster populations. Rather, problems in Gulf of Mexico oyster populations that led to harvesting moratoriums led to greater demand for Chesapeake oysters in that strong 2022-2023 season.

With the Gulf oyster industry back online during the season just past, demand for Chesapeake oysters along the East Coast declined, especially after the typically strong holiday season. In January, February and March there were many weeks when buyers only had a market two or three days.  Instead of harvesting five days a week as permitted by law, watermen had to stay home when there weren’t market days.

Jeff Harrison, a waterman and president of the Talbot Waterman Association, said things weren’t so great for Maryland oystermen last year and he expects the same for this new season. “We’re getting $35 per bushel this year.  That’s the same as we got 25 years ago. It might go a little higher before Christmas but not much.  The biggest thing is the market. It’s not what it was and we’re not sure why.  There’s lots of oysters out there.  The spat set in Broad Creek is amazing again this year, possibly because of the sanctuaries where the state’s putting oysters and prohibiting harvesting. And it’s not the quality of the oysters. The quality is as good as I’ve ever seen. It’s a good time to be eating oysters. I think the shuckers are getting two to three pints of oysters more per bushel than they were last year, but we’re still only getting $35 per bushel.”

Harrison said this year’s crab market was also soft.  “Everything hit great around the Memorial Day holiday.  Best ever. We were getting $200 per bushel and there were plenty of crabs around. Making good money.”

But then, he said, the market softened through the summer.  “The crab volume went down when they spread out from the creeks. We weren’t catching as many and the price also started going down.  By the fall, when the crabs are the fattest and the best, the price at the dock for us had dropped to $70 per bushel for number ones.  It’s been a long time since we got that little. Better product and less dollars, for the oysters and the crabs. It doesn’t make any sense.

 “Apparently, the same thing’s going up and down the coast,” he said. “Lobstermen and shrimpers are saying they’re not getting any real money either.  And 85 percent of our seafood still comes from overseas. Why don’t people want to buy local seafood and pay for it?  Maybe it’s the economy. I don’t know. But something’s going on.”

Chris Judy, director of Maryland’s Shellfish Division, tried to inject a dose of reality into the situation with a touch of the positive. “From what we hear, this season’s catch is down, but note that even if it ends up at about 400,000 bushels (compared to the earlier 722K or 437K) this is still a strong harvest compared to the trend of the prior decades.”

Watermen harvest oysters by hand tonging, dredging under sail and power on skipjacks, diving and hand picking from the bottom, and using hydraulic-powered patent tongs for working deeper water bars. Dredging the bottom under power with typical workboats has become the most popular and efficient method.

Dennis Forney has been a publisher, journalist, and columnist on the Delmarva Peninsula since 1972. He writes from his home on Grace Creek in Bozman.

State lawmakers will return to Annapolis in January facing a widening structural budget gap that analysts said is on track to become one of the worst fiscal situations in two decades.

One-time fixes including tapping available cash in the Rainy Day Fund could ease the pain, lawmakers were told Tuesday, but doing so could leave the state at risk for an array of other concerns, including a recession.

“The overarching takeaway from today’s meeting is that there’s an enormous gap between the ongoing spending commitments the state has made and ongoing revenues,” said David Romans, a Department of Legislative Services budget analyst, in a presentation for legislative fiscal leaders, including members of the Joint Spending Affordability Committee.

Romans said that in just five years, the state will face “a significant challenge” in paying for those commitments.

“By fiscal 2030 — the final year of our forecast — we are showing the state will only have enough revenue to cover 84% of the expenses we’re projecting the state to incur,” Romans said. “That is the largest gap that we have seen in the last 20 years. It is more significant than the Great Recession.”

In fiscal years 2008 and 2009, during a deep recession, budget projections said the state was on track to have only enough revenue to cover 89% and 87% of its ongoing spending, according to the Department of Legislative Services.

Maryland faces more than $1 billion in combined structural and cash deficits in the current year. That gap more than doubles to $2.7 billion in fiscal 2026 and 2027.

By fiscal 2028, the state will exhaust the money set aside to cover the costs of education reforms, and will require money from the general fund. The structural deficit grows to nearly $4.7 billion in 2028, then $5.2 billion a year later, and again to $5.9 billion in fiscal 2030.

Senate Minority Leader Stephen S. Hershey (R-Upper Shore) called the outlook “pretty dismal.”

“A $2.7 billion deficit is not something that, unfortunately, … you can just make up with cuts,” Hershey said. “I hope that you can, but that’s a pretty big gap. It makes it very concerning that the governor and General Assembly are going to have to raise taxes. I’m hoping that’s not going to be the case, but I’m not sure how they can close that gap.”

Tuesday’s briefing was a stark reminder of budget pressures facing Gov. Wes Moore and a legislature controlled by Democrats.

An impasse between the House and Senate earlier this year led to a budget compromise that failed to fully address concerns. House leaders wanted a $1.3 billion tax and gaming proposal, while Senate leaders opposed broad-based taxes in favor of targeted increases. The result was a projected $1 billion structural deficit — the difference between expected spending and revenues — for fiscal 2026 .

By July, those budget concerns were growing.

Moore proposed $150 million in budget adjustments this summer that were billed as cuts, but in reality reduced spending in several state agencies that was then shifted to cover costs of growing Medicaid enrollment and the state’s child care subsidy program.

Multiple legislative sources said in July that Medicare spending alone could add $800 million to the projected deficits.

Moore and Senate President Bill Ferguson (D-Baltimore) said this summer that they had a “high bar” for any tax increase. Moore also warned county officials in August of the likelihood of tough budget decisions.

It comes as recent polling shows Marylanders are still feeling pinched economically. The issue was top of mind for many voters in Maryland and nationally during last week’s election.

A spokesman for Ferguson said the Senate leader would have a comment on the fiscal briefing soon.

A stagnant economy

Over the next five years, ongoing expenses in the state budget are projected to grow at 6% annually, while revenues are projected to grow at around half that amount, legislative analysts said Tuesday.

Maryland’s economy remains stagnant: The Board of Revenue Estimates said in September, in a first look at expected revenues for fiscal 2026, that taxes and other funds flowing to the state would grow by 0.9% over the current fiscal year.

“We have not seen a lot of employment growth,” Romans told lawmakers. “We do have very low unemployment, but we’re just not seeing much employment growth, and that’s suppressing our revenues a little bit.”

Coming state budgets will have to absorb billions in additional costs for education reforms in the Blueprint for Maryland’s Future. The state also faces higher-than-expected costs for Medicaid, driven by inflation and increased enrollment, and greater demand for the state’s childcare subsidy program.

“So, all those additional spending pressures are leading to spending growing much faster than the revenues,” Romans said.

“Significant long-term solutions” needed

Moore and lawmakers could draw down on the state’s Rainy Day Fund. At $2.5 billion, the cash in the account is twice the statutory requirement of 5% of annual revenues. Taking half the fund would cover the gap projected for the current year and a portion of fiscal 2026.

The state could also suspend a requirement to set aside hundreds of millions to hedge against revenue volatility, and it could shift $250 million in cash to the deficit and opt to borrow money to pay for the already approved capital projects.

“If you did those three things, you can get through fiscal ’25 without any really difficult decisions, and you solve roughly half the fiscal ’26 problem,” Romans said.

Those moves are not without risk, however.

First, Romans said Moore and lawmakers still face “an enormous problem in ’26 and it grows dramatically by (fiscal) ’28.” That problem likely will require “significant long-term solutions.”

Those include cuts to spending or increased taxes or both.

“You’re not going to be able to just use the cash resources the state has to manage our way out of the problem,” Romans said.

“This budget problem is not being driven by a recession,” he said. “It’s being driven by a somewhat stagnant economy and by our spending ambitions.

Advocates renew push for $1.6 billion tax plan

The cash options are a one-time fix.

“So, if you use the Rainy Day Fund and you get rid of the revenue volatility, you’re eliminating two of the things that you sort of can rely on during recession to help mitigate the impacts of a recession,” Romans warned.

“I would be cautious in using these strategies without having a longer-term plan to solve the budget problem, because if we were to fall into a recession in the next few years, you would have very few options left to deal with it, other than making substantial cuts.” he said.

Advocates for a broad-based tax package proposed earlier this year seized on the briefing to renew calls for their plan.

“Now is the time to fix our tax system and ensure we have the revenue we need to fund the education, health, and public safety programs that make our communities stronger,” Fair Share Maryland, a coalition of 40 organizations, said in a statement Tuesday. “The Fair Share Maryland plan reforms the state’s upside-down tax system that currently gives unfair tax breaks to large corporations and the ultra-rich.”

Advocates said the plan, as introduced in January, cobbled together a number of proposals from earlier, failed legislation. The largest revenue source — $576 million a year — would come from closing what advocates called “corporate tax loopholes.” That includes counting corporations and their subsidiaries as one entity for tax purposes, preventing corporations from moving profits from one state to another state or country with a lower tax rate.

“Maryland leaves hundreds of millions of dollars on the table each year it fails to close corporate tax loopholes,” the group said. “Our state policies also allow the wealthiest 1% of households in Maryland to pay a smaller share of their income in taxes than anyone else. This puts the burden for public services on working families and our small businesses.”

The bill also included an increase in taxes for residents earning $1 million or more annually, as well as a 1% surcharge on capital gains.

“We can build a durable and resilient economy by righting our state’s tax code,” the group said. “Maryland can also raise $1.6 billion in revenue each year to support good schools, health care, transportation, and the state workforce needed to deliver high-quality services. Doing so will also cut taxes for more than 1 million Marylanders with a family income of $65,000 or less.”

But the deficits projected 10 months ago were smaller. It is unclear how much the Fair Share plan would cut into the current projections.

Possible Trump effect looms

None of the projections outlined Tuesday included potential changes as the result of the 2024 presidential election.

President-elect Donald Trump has vowed to purge federal employees and move federal agencies outside the Washington, D.C.,  region. Montgomery County Executive Marc Elrich said last week that he ordered a review of potential impacts to the county budget, but predicted there would also be consequences for the state.

There are also concerns about funding for the replacement of the Francis Scott Key Bridge and the relocation of the FBI headquarters to Prince George’s County.

One proposed project important to Moore – the Red Line rail system — was not mentioned. But Hershey said he does not believe the Trump administration will ever fund the east-west transit line.

“I think honestly, with the Trump administration coming in, essentially, for all intent purposes, the Red Line is dead,” Hershey said. “We’re not going to see federal funding for that.”

Maryland receives about $19 billion annually in federal aid. That’s in addition to the 256,000 residents – about 8% of all state taxpayers — who received some form of federal wages or pension payments in 2021, according to the Comptroller’s Office.

The economy could also take a hit if Trump follows through with other proposals, including mass deportations and tariffs that analysts worry could trigger inflation and recession.

“We don’t have any real way to model what they might propose to do, and a lot of those sort of things will require congressional action, so we’ll certainly be monitoring that,” Romans said. “There’s certainly a significant risk to our economy.”

By Bryan P. Sears