Maryland Gov. Wes Moore pitched a plan on Wednesday that closes a significant state budget gap without raising taxes or fees.

Instead, the governor will rely on a series of spending cuts, one-time transfers and budget maneuvering to keep the budget in balance — avoiding unpopular tax increases during an election year.

Discussing highlights at a State House press conference, the Democratic governor said the $70.8 billion budget is responsibly crafted.

“This budget shows that we can spend wisely and also protect our values and demand more from how we are using our budget,” he said.

In order to close a $1 billion-plus shortfall without raising taxes, Moore’s proposed budget would shift money from dedicated funds into the general fund that pays for general government operations.

For example, $322 million that would have been spent on construction projects would be used to cover the budget gap. That includes $125 million that was projected to be spent on building a state-run “therapeutic” jail in Baltimore that has ballooned in price and drawn opposition.

Hundreds of millions more dollars would be drawn from a fund that pays for clean energy projects, a savings account when tax payments come in higher than expected and the Rainy Day Fund.

And local governments will need to pick up more of the burden for retirement plans for local school teachers, librarians and community college workers, which is currently shared with the state.

Cutting spending

Moore also is proposing cuts, some of which are sure to generate opposition.

“Maryland is going to be forced to do more with less,” the governor said.

The state plans to trim costs in the Developmental Disabilities Administration, where spending has been rising to assist Marylanders enrolled in programs, for example. The agency assists residents with personal care, housing, job training and transportation, among other services.

The savings there would amount to $150 million.

“This is a tough issue, but it is one we must tackle,” said Jake Weissmann, Moore’s acting budget secretary.

The Developmental Disabilities Administration was targeted for cuts last year, causing an outcry from people who rely on the adminstration’s programs and funding. Most of the proposed cuts were abandoned.

Advocates for the developmental disabilities community said they appreciated having more input into the budget proposal this time around, but that more work needs to be done.

“The current proposal will need to be assessed and refined in order to avoid further negative impacts on Marylanders with disabilities,” said Laura Howell, CEO of the Maryland Association of Community Services.

Moore also would save money by freezing the rates the state pays organizations that provide services to Marylanders through programs in the departments of health, human services and education.

Weissmann described the budget as a “low-growth” budget, “only funding services essential to Marylanders.”

Despite the cuts and flat-level funding in some programs, Moore touted some spending increases that are in line with his priorities, among them:

• $124 million for grants for local police and sheriff’s departments, representing a $2 million increase.
• $414 million for the state Child Care Scholarship program, which is so popular it has to turn away families.
• $32 million for the governor’s ENOUGH Initiative, which provides grants for community programs in neighborhoods with high rates of child poverty.
• $13.5 million in grants and incentives for the proposed mini Sphere project at National Harbor in Prince George’s County.
• $10.2 billion in public education, including increases to a formula that calculates aid tied to students eligible for free and reduced-price meals.

Responding to pressures from Trump, economy

Moore and his team were tasked with closing a gap of at least $1.4 billion between money coming into state coffers and money expected to be spent on programs ranging from running state prisons to monitoring fish populations to helping kids in foster care. The state is legally required to have a balanced budget each year.

The shortfall has multiple causes, among them the federal “One Big Beautiful Bill,” which has resulted in less tax money being paid to the state. The state’s economy has also taken a hit from the Trump administration’s layoffs of federal workers and cuts in spending on government contracts. Maryland lost 25,000 federal jobs in 2025.

“There has been no state that has been hit harder by these reckless policies of the Trump-Vance administration than the state of Maryland,” Moore said.

The state government, like everyone else, is paying more for goods due to inflation. Health care costs are also rising.

Moore and top Democratic lawmakers have said for weeks that they would not rely on tax increases to close the gap.

The budget will go to the General Assembly, where lawmakers have the power to make changes. The Senate will review the budget first, followed by the House of Delegates. Negotiations on the fine details of the budget could last through much of the 90-day General Assembly session.

Moore met privately with top legislative leaders over breakfast on Wednesday morning to kick off budget discussions and said he and his team worked with lawmakers on developing the budget proposal.

“They can see their work and their fingerprints all over this budget,” he said.

Republicans press for more

Republican leaders were not impressed with the governor’s proposal, saying it relies too much on one-time shuffling instead of addressing the long-term imbalances between revenues and expenses.

“Marylanders expect a responsible, sustainable budget that addresses the real challenges facing our state — not one that postpones difficult but necessary decisions," Sen. Paul Corderman, a Western Maryland Republican who serves on the Senate’s budgeting committee, said in a statement.

“The Governor’s budget proposal is largely based on accounting tricks and adjusting anticipated spending increases, rather than meaningful changes in budgetary policy that stop the tax-and-spend spiral,” Del. Jason Buckel, the House minority leader, said in a statement.

Republicans are outnumbered 2-to-1 by Democrats in the General Assembly, leaving them with limited influence over the outcome of the budget.

The budget, once finalized, will govern state spending from July 1 through June 30, 2027.