County Executive Rushern L. Baker, III announced this week that Governor Larry Hogan purposes an $83.3 million cut from FY 2017 state budget. The proposal will mainly target disparity grant funding in four counties, including Prince George’s County. The remaining $4 million will be split between Washington County, Wicomico County, and Cecil County.
Disparity grants were developed to assist jurisdictions that do not meet the statewide average local income tax revenue. The disparity grant would be utilized to balance the county budget. Maryland experienced a similar issue in 2010-2011, with a loss of nearly $200 million statewide revenue in 2009. States that received disparity grants had their allocations reduced. Among these was Prince George’s County, which faced an 84 percent reduction, receiving $3.4 million in FY 2011.
Local jurisdictions that experienced an increase in Fiscal 2017 will face a 50 percent reduction. It has not been decided whether these cuts are going to be temporary or permanent. Prince George’s County will be the hardest hit, making it more difficult for the County to assist low-income residents.