Maryland Governor Warns Of Drastic Budget Cuts

ANNAPOLIS, Md. (WUSA) -- Dire warnings Tuesday from Maryland's governor if Monday's special legislative session fails to pass his tax and spending plan.

The Governor says without more money, the state will have to layoff state workers, close police barracks and freeze education spending.

Waving what he calls his Cost of Delay Budget and surrounded by his Cabinet in front of the State Capitol, Governor Marin O'Malley (D-Md.) warned the legislature of big cuts to come if it fails to raise taxes during next week's special session: "A weaker state, a state where people in need of critical services are pushed off health care rolls. A state where we're not able to keep police barracks open. A state where we have to close state parks."

The Governor says he'll have to cut state aid to counties by nearly $1 billion: including $153 million in cuts to Prince George's, and $86 million to Montgomery.

"That would include cutting things like schools, teacher pensions, libraries, police aid, drug treatment, public health," says the Governor.

While the Governor is raising this doomsday scenario, legislative leaders say they are pretty close to a deal, a deal that would pass much of the Governor's tax package.

"I think the vast majority of members want to do something that's going to limit pressure on the working class and the middle class, an ask those with higher income to pay a little more," said House Speaker Michael Bush, referring to the Governor's plan to revamp the state's income tax brackets.

Republicans, on the other hand insist Governor O'Malley is overreacting.

"I think Halloween has come early to Annapolis," said Sen. E.J. Pipken (R-Queen Anne's Co.) "We've seen all the scare tactics."

"He's trying to scare us into thinking we have to increase taxes when we could just slow down the rate of increase of government and we'd be fine," says Minority Whip Sen. Allan Kittleman (R-Howard).

The Governor says he's struggling with a $1.7 billion shortfall, and there is no way he can fill it painlessly. Many legislators want to see the actual bills. The Governor says he'll have his proposed legislation out by Friday -- including his plan to legalize slot machines.