Maryland Budget Plan Seeks $935M of GOs

WASHINGTON — The $1.5 billion capital budget for fiscal 2009 that was unveiled by Maryland Gov. Martin O’Malley last week includes a proposed authorization for the state to issue a total of $935 million in general obligation bonds over five years.

“Maryland’s budget is one of the clearest reflections of the values we share to build a stronger, healthier Maryland for the next generation, and to make progress on our shared goals,” O’Malley said in a release last week. “Building on the progress we made to make state government work again last year, we remain committed to expanding economic opportunities for Maryland’s families and small businesses, reforming and improving our schools and making higher education more affordable, improving public safety and homeland security, and protecting our quality of life and our natural resources.”

The $935 million is more than the $810 million authorization over five years that the governor sought in fiscal 2008, according to Chadfield B. Clapsaddle, executive director of the state Office of Capital Budgeting. Maryland’s fiscal year runs from July 1 to June 30.

Maryland’s General Assembly must approve the authorization before the state can issue any of the bonds. The state typically issues GOs twice a year. It is planning to issue $350 million of general obligation bonds Feb. 27 and $415 million in July.

“We are watching our cash flow monthly so the numbers are subject to change,” said Maryland debt management director Patti Konrad. “We estimate this bond issuance based on the authorization and the fact that it takes about five years to fully fund all of the projects in the authorization.”

Of the $935 million in debt proposed in the O’Malley’s budget, $560.5 million would be used for education, including $300 million for public school construction, $161.7 million for public universities and colleges, and $81 million for community colleges. Also included in the $935 million is $111.5 million for health and environment projects, $187.8 for public safety programs and $20.8 million for economic development.

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