Baltimore Sun

With the auto industry crippled by the economic downturn, Maryland may need to cut $2.5 billion from the transportation budget for highways, transit and other projects – on top of $1.1 billion in recent reductions, a top fiscal analyst warned state lawmakers yesterday.

The additional cuts to the $9.4 billion, six-year transportation spending plan are needed because of a decline in taxes and fees brought on by slower car sales and lower gas consumption, said Warren G. Deschenaux, the chief budget analyst from the nonpartisan Department of Legislative Services.

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Maryland officials announced $1.1 billion in transportation project cutbacks in September. As a result, upgrades to the MARC system will take longer, and improvements to intersections affected by the Pentagon’s military base realignment process affecting Fort Meade, Aberdeen and Bethesda will be delayed.

Spending on capital projects is essential to minimize road congestion and respond to a growing population and increased demand for transit options, said Donald C. Fry, president of the Greater Baltimore Committee.

Further cuts could imperil expansion plans at BWI Marshall Airport and plans for dredging at the port of Baltimore, he said.

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More cutbacks would follow efforts last year to shore up the transportation trust fund by directing a portion of sales tax revenue to it and by increasing other taxes that are funneled there.

The legislative services report assumes that titling tax revenue will plunge $1 billion over the next six years, as car sales in Maryland are on track to decline 10 percent this year, according to the Maryland Automobile Dealers Association. It also assumes a $139 million dip in motor fuel tax revenue as the number of vehicle miles traveled has declined.

Porcari took issue with the forecast’s assuming a $464 million increase in his agency’s operating budget, saying his agency has implemented “strict cost containment measures.” He also said that titling taxes often rebound within a few years of a recession as people replace older vehicles and the economy recovers.