ANNAPOLIS — Maryland’s Department of Budget and Management has directed executive branch agencies and state higher education institutions to draft spending plans that include hypothetical reductions of up to 10% as the state addresses a projected $3.1 billion shortfall for fiscal 2028.
What the request requires
The memo, circulated to agency heads and obtained by The Baltimore Sun, asks departments to outline where and how they could achieve a 10% reduction in their budgets. Officials emphasize the exercise is a planning tool — not a final decision on cuts — intended to provide options as policymakers shape a balanced budget to meet the legal requirement that the governor submit one.
Maryland routinely asks agencies to identify modest savings during the annual budget process; this cycle’s request is notably larger than the typical 3% scenarios previously sought. The administration says the deeper exercise reflects worsening fiscal pressures that project state spending to exceed revenue over the next five years.
Administration response and context
A spokesperson for Gov. Wes Moore, Rhyan Lake, framed the request as a targeted review. "After inheriting long-standing structural budget challenges compounded by the Trump administration's hits on Maryland's economy, closing next year's deficit will require a targeted look at where the state can save — and this analysis is part of that process," Lake said in a statement provided to reporters.
State officials and lawmakers are considering a mix of options to close the gap, including spending reductions, tax and fee changes and adjustments to local government authority. Economic forecasts from the Department of Legislative Services show the possibility that spending could outpace revenue over several years, heightening the need for corrective measures.
Potential impacts and scale
DBM asked agencies to detail the potential operational impacts of scaled-back spending, including effects on staffing, grant programs and core services. While the 10% figure does not guarantee that every agency will face that level of cuts, the exercise is expected to identify hard choices for the administration and the General Assembly.
Economists and policy analysts say whether the state reduces services or raises revenue will have ripple effects on households and the broader Maryland economy.
| Item | Figure |
|---|---|
| Projected shortfall for fiscal 2028 | $3.1 billion |
| Requested planning reduction | 10% |
| Typical planning reduction in prior years | 3% |
What agencies must submit
- Budget proposals reflecting a 10% spending reduction.
- Breakdowns of operational costs and where cuts would affect staffing.
- Analysis of impacts to grants and agency programs.
DBM officials told The Baltimore Sun that the memo mirrors normal budgetary planning, except the target was substantially larger due to fiscal strains. The department emphasized that these are scenarios to aid decision-making, not final directives to reduce personnel or terminate programs.
Lawmakers and next steps
State lawmakers will play a central role in determining how the shortfall is addressed when they consider the governor’s budget and any supplemental measures. Possibilities under consideration by legislators include raising certain taxes or fees and revisiting the balance between state and local fiscal authority.
Under Maryland law the governor must submit a balanced budget; the Moore administration says it remains committed to fiscal discipline while protecting priority programs. The DBM exercise is intended to give state leaders a clearer picture of trade-offs as they prepare for next year’s budget deliberations.
Officials have not released a timeline for when final decisions on cuts, revenue measures or other adjustments would be made, but the modeling requirement represents an early step in what is expected to be a difficult budget season for Maryland.
Reporting for this story used material from The Baltimore Sun and comments provided by the governor's office to local media.
