Posted on 02/10/25
| News Source: WBAL
Maryland’s Senate president is warning of a potential for deeper state budget cuts to address an impact of President Donald Trump’s executive orders and Republican tax proposals in Washington.
Senate President Bill Ferguson, D-District 46, raised a red flag Friday that Maryland may have to come up with several hundred million more dollars to balance the budget. Lawmakers are already grappling with a projected $3 billion deficit.
| BUDGET BOOK: See highlights of FY2026 budget proposal (PDF) | Full story
So, what has changed?
Congressional Republicans are working on legislation to cut taxes for the wealthy and pay for it by shifting more of the cost of Medicaid to states. Ferguson said the potential of such action could be devastating to Maryland.
“The reality is, it’s worse than we expected,” said Ferguson, citing a briefing he received Friday from U.S. Sen. Chris Van Hollen, D-Maryland.
| ON THE HILL: U.S. House Republicans are working to meet President Donald Trump’s demand for a big budget package that includes some $3 trillion in tax breaks, massive program cuts and a possible extension of the nation’s debt limit. See what’s under consideration.
Currently, there is a 5050 split between states and the federal government on Medicaid costs. How that could change remains unknown.
“When they do their tax cut for the wealthy, I do expect they will include cuts to Medicaid,” Van Hollen told state lawmakers during a briefing Friday.
Ferguson said he believes even a slight shift in cost-sharing — coupled with slashing the federal workforce — may put the state hundreds of millions of dollars in the hole.
“(We’ll) likely have to find several hundred-million dollars in additional cuts and savings within state government,” Ferguson said. “We know that Medicaid has been a driver of some of our challenges in the state. Additional cuts to Medicaid or additional cost shifts will have an absolutely devasting impact on the state of Maryland.”
The president wants to downsize the federal workforce, which would impact tax revenue for Maryland. Ferguson said each civil servant position that gets eliminated would lead to three to five private sector jobs that depend on federal grants and contracts. Shutting down the U.S. Agency for International Development has already resulted in furloughs of hundreds of workers who live in Maryland, state officials said.
Ferguson said when it comes to the state budget, everything remains on the table, including calling a special session to make more adjustments.
| ‘MEET THE MOMENT’: In his third annual State of the State address, Maryland Gov. Wes Moore warned of difficult decisions ahead, but, in his words, reassured that the state will “confront this moment of crisis with courage.” See what the governor had to say.
Before information leaked regarding the Republican tax proposal, 11 News spoke one-on-one with Maryland Gov. Wes Moore, a Democrat, who responded to the Trump administration’s executive orders and pledges to cut the federal workforce.
“This is serious,” Moore told 11 News on Wednesday. “This is arguably the most consequential, most challenging governing environment that we have seen in generations.”
Moore acknowledged to 11 News that the state is too dependent on the federal government, and he outlined steps he’s taking to wean Maryland off that reliance.
“We are actually focused on investing in industries that have a chance to grow outside our dependence on the federal government: There are three lighthouse industries that we are going to make big bets on, that is going to be life sciences, IT, aerospace and defense,” Moore told 11 News on Wednesday.
WBAL-TV 11 News reached out to Maryland’s Republican leadership and the state’s sole Republican member of Congress, U.S. Rep. Andy Harris, R-District 1, for comment but has yet to receive a response.
| REPUBLICANS CONCERNED: Maryland state Republican legislative leaders are taking issue with some pieces of the governor’s 2026 budget proposal, particularly when it comes to tax code changes and 18 instances of new or increased taxes and fees. Here’s why.