D.C., Maryland and Virginia are staring down budget issues as state governments have spent billions of dollars on the coronavirus crisis — and spending could increase with a peak in infections still expected in the weeks or months ahead.
At the same time, an extended span of social distancing will mean a further decline in state and local tax revenues as homebound residents reduce their spending, further increasing budgetary issues.
Maryland Gov. Larry Hogan said Tuesday that the state will face “massive budget problems” in the months ahead and he hopes to avoid “major layoffs” of state employees.
“I think we’re already at the point where we’ve spent somewhere in the neighborhood of $1 billion to $2 billion, which is a pretty big number,” Hogan said during a press conference Tuesday at the Baltimore Convention Center, which is now serving as a field hospital. “There’s going to be massive budget problems, for us, for every state in America, just like there are major budget problems for individuals and small businesses and large businesses and the federal government.”
The $2 billion number exceeds Maryland’s rainy-day fund by about $700 million.