FROM THE DESK OF THE COMPTROLLER

March, 2008

The 2008 General Assembly session is quickly drawing to a close, and the state's economic forecast is not looking bright. Maryland will face difficult choices in the months ahead as our state's fiscal outlook continues to be clouded by the growing economic uncertainty across the country. Recently, at the March meeting of the Board of Revenue Estimates, we reported that for the next 16 months state revenues are expected to drop more than $330 million below previously calculated estimates.

The hard numbers that were presented in March speak for themselves. They confirm that the collapse of the U.S. subprime mortgage industry has taken a profound toll on consumer confidence and, for that matter, virtually every aspect of our nation's economy and that the state of Maryland is not immune to these trends.

There is no question that these realities are taking their toll on the nation's economic psyche. Significant economic indicators have led an increasing number of economists to believe that we are heading towards, if not already in, a recession. Simply put, the storm clouds are not receding anytime soon and conditions are likely to grow worse before they improve.

While the last thing many of us would like to do in tough fiscal times is file taxes, I ask you to help the Comptroller's Office cut the cost of processing the $20 billion, which we will collect in the coming weeks. With the filing deadline now less than a month away, I urge taxpayers, if they have not already done so, to file as early as possible and to file electronically, using either our office's free iFile or bFile services. Filing electronically not only provides faster refunds; but, it also saves the state money and resources needed to process a paper return.

I am committed as Comptroller to continue being a prudent fiscal watchdog and to provide an unvarnished assessment of the financial issues affecting our state. Though our national and state economy face challenges in the months ahead, Maryland continues to possess many fundamental strengthens - our educated workforce, unique federal partnerships and a proud tradition of fiscal stewardship as seen through our coveted AAA bond rating - which will help us weather any turbulence in the future.