ANNAPOLIS, MD—Governor Larry Hogan on Thursday announced preliminary recommendations for the state’s Fiscal Year 2024 (FY24) budget, a plan that supports continued economic growth and community revitalization, strong fiscal responsibility and budget sustainability, and key investments in critical areas—including expanding access to health care for rural and vulnerable communities.

“I pledged to bring fiscal responsibility and common sense to our state capitol,” said Governor Hogan. “I know this doesn’t usually happen in politics, but we then did exactly what we said we would do. We inherited the worst fiscal situation ever, and we are not just leaving the state’s finances in better shape than we found them, but leaving it in the best fiscal position than the state has ever been in history.”

Under the state’s budget process, the outgoing administration has prepared a preliminary budget to be submitted to the incoming administration, which will ultimately be tasked with submitting the final budget to the General Assembly no later than Friday, January 20.

Maintaining Fiscal Responsibility and Budget Sustainability

The recommended FY24 budget plan calls for preserving the state’s strong fiscal position by maintaining a substantial budget surplus and keeping the Rainy Day Fund at a record 12% of general fund revenues—all while continuing to fully fund core priorities.

Amid economic uncertainty and persistent inflation, the governor stressed the importance of limiting budgetary risk: “With continued inflation and economic uncertainty at the national level, we believe this is critically important. It would be a mistake for the legislature to use its newly expanded budgetary power to return to the old habits of raiding the Rainy Day Fund or recklessly spending down the surplus. We have worked too hard and made too much progress to turn the clock back.”

Record-Funding Education and Supporting Low-Income, High-Need Students

The recommended FY24 budget plan includes:

• Continuing to fund K-12 education at record levels;
• $10 million in support for non-public schools to address learning loss caused by the COVID-19 pandemic, and
• $10 million for the highly successful BOOST program, which provides scholarships for low-income, high-need students to attend the school of their choice (to date, the program has provided over 15,000 scholarships—the vast majority of which have gone to students in the state’s four largest jurisdictions).

Expanding Access to Health Care Services For Rural and Vulnerable Communities

The recommended FY24 budget plan calls for $220 million in transformative health care investments to expand access to health care services for rural and vulnerable communities, including:

• $100 million to advance the University of Maryland Medical System’s plan to construct a new Regional Medical Center in Easton, to ensure advanced clinical care is available in the Mid-Shore region.

“We thank the Hogan administration for this important effort to address the challenge of rural health care in Maryland,” said Mohan Suntha, MD, MBA, President and CEO of the University of Maryland Medical System. “At UMMS, we are building upon our long tradition of excellence in patient care and innovation to be a leader in the transformation of healthcare statewide. As an academic health system, we are working throughout Maryland in diverse rural, urban and suburban settings to solve unique healthcare challenges. Over the last decade, we have invested in a comprehensive and integrated care delivery system with a presence in every county in the Mid-Shore and this new Regional Medical Center in Talbot County will allow our team members to maximize our capacity to deliver better outcomes for patients.”

• $100 million to advance Sheppard Pratt’s plan to expand behavioral health services in Maryland—including expanded capacity at its new Elkridge campus, a new dedicated children’s hospital in Towson, a neuroimaging center to advance cutting-edge research, and a global training center for workforce development.

“We thank Governor Hogan for this significant commitment to leverage the world-class resources of Sheppard Pratt to propel discovery and transform mental health care in Maryland and across the nation,” said Harsh K. Trivedi, MD, MBA, President and CEO of Sheppard Pratt. “During this unprecedented mental health crisis, our bold plan will build upon decades of partnership with the State of Maryland to create new tertiary psychiatric inpatient services for both children and adults, including the opening of a dedicated children’s hospital. As a national leader in the care and treatment of people with severe mental illness (SMI), this initiative will enable the development of new treatment modalities, spur innovation to ensure best practice implementation across the field, and reimagine and train the mental health workforce of the future. This moonshot for mental health will be a game changer in providing hope, advancing care, transforming lives, and achieving mental health equity.”

• $10 million to advance Meritus Health’s plan to construct a new School of Osteopathic Medicine in Hagerstown. The governor attended the groundbreaking ceremony for the new medical school earlier this fall.

“We are grateful for Governor Hogan’s visionary leadership in advancing health and healthcare in Maryland,” said Meritus Health President and CEO Maulik Joshi. “The Meritus Medical School will be a game changer for access to care for everyone in underserved rural Maryland and in communities like us across America. This tremendous support will make an impact on health for generations to come.”

• $10 million in initial funding to advance the Kennedy Krieger Institute’s plan to build a new Innovative Care Center on its East Baltimore campus. Learn more.

“All of us at Kennedy Krieger Institute are profoundly grateful to Governor Hogan and his administration for this outstanding support of our shared vision to build a specialty pediatric Innovative Care Center to benefit Maryland children and families,” said Bradley L. Schlaggar, MD, PhD, President and CEO of the Kennedy Krieger Institute. “We appreciate him, and Maryland’s leadership, for their substantial and continued support of the more than 27,000 young people, and their families, that we serve each year, and for supporting Kennedy Krieger’s unique mission to provide care and services for children with neurological, rehabilitative, mental, and behavioral health needs. Our new Innovative Care Center will help thousands of children and teens pursue all that’s possible in their lives. We eagerly look forward to working with Maryland’s leaders to bring our vision for a world-class specialty pediatric healthcare facility to reality. Thank you for this transformational investment that will benefit the health and well-being of Maryland’s children for generations to come.”

Reinvesting In Police, Public Safety, and Victim Services

The recommended FY24 budget plan includes:

• Continuing the state’s $500 million Re-Fund The Police Initiative to increase support for state and local police;
• An additional $30 million to Victims of Crime Assistance (VOCA) grant recipients;
• $2.1 million for a ZeroEyes gun detection pilot program;
• $400,000 for an automated ballistics imaging system for the Maryland State Police crime lab.

Leading on Environmental Stewardship and Land Conservation

The recommended FY24 budget plan includes:

• Continuing to fully fund Chesapeake Bay Restoration; and
• $102 million to fully replenish Program Open Space eight years ahead of schedule to accelerate land conservation projects.

Supporting Economic Growth and Statewide Revitalization

The recommended FY24 budget plan includes:

• $70 million for rental housing and homeownership programs;
• $25 million each for the successful Project Restore and Neighborhood BusinessWorks initiatives;
• $25 million for Project CORE to clear blighted units in Baltimore City; and
• $10 million for the National Capital Strategic Economic Development Fund (to date, more than 5,000 units have been cleared through Project CORE, leveraging more than $2 billion in investment to support revitalization in Baltimore City).

The recommended FY24 budget plan includes:

• $15 million for the Jobs That Build initiative to hire and retain skilled construction workers; and
• $1 million for the Global Gateway Initiative to attract foreign companies to the state.

Addressing The Rise in Hate Crimes and Anti-Semitism

The recommended FY24 budget plan includes:

• $5 million to support local efforts to address the rise in hate crimes and acts of anti-Semitism; and
• $800,000 for an initiative at the University of Maryland’s Merrill College of Journalism to launch a training program focused on Asian American issues and communities. This program builds on the work of the state’s Asian-American Hate Crimes Workgroup.

Combating Cyber Threats With Historic Investments

The recommended FY24 budget plan includes additional investments to build on last year’s historic cybersecurity investments of over $200 million:

• $152 million for continued improvements and modernization of the state’s cyber defenses, as well as additional personnel to keep state data and IT systems secure.
• A $7 million grant fund to assist local governments with bolstering their own defenses against ransomware attacks.

Additional Budget Priorities

In addition, the Hogan administration has made a series of operating and capital grant recommendations.

Thursday’s full budget announcement press conference can be viewed below.