Evening capital and Maryland gazette. (Annapolis, Md.) 1910-1922, 1921-07-19
LEE POINTS OUT
DEFECTS IN STATE
FINANCE SYSTEM

system OF preparation By legislative
committees OF general appropriation
bills covering two-year periods in the
rush and excitement Of a nineiy-day
legislative session The fact that the
buslnesslike arrangement by Cover
nor Richie Of the last executive
budget in January 1920 allowed a re-
duction in the State tax rate al
time when the cost or living. as affect
ing State employees and the cost OF
State supplies. were al their peak. is
one Of the striking illustrations Of the
benefit 10 the taxpayers OF Maryland
OF this central control Of appropria-
tlons through the executive budget.
with the adoption OF the budget
system however. the old system Of
decentralized collection. disbursement.
and review OF disbursement OF the pub
lie funds of Maryland was not chang
ed This old divided financial respon-
sibility in the various agencies handl-
ing public funds still continues I'M
changed.
with regard TO disbursements
generally. the present financial sys-
TEN in most cases provides for a dis
bursemeni in bulk 90 the various
State departments This prevents the
State Treasury Department from ex-
eTcising any element of control or re-
view over the items of disbursement.
excepting that the department in ques-
ton Is required 20 keep its annual eK-
peudifures within the total limit Of
thar department budget approprla-
tion aud must spend che items az The
appropriation for ihe purpose men
toned Ia the budget law The Treas
ury Department has NOT the power 90
require ans department 20 spend as
little of iis appropriation a. is actual
~ Required through changes of con
oifions Wlfhiu fhe fnlrtF-tNo months
Nhleh elapse between fae time ite
hudFef Is submitted fo The i.aEisia-
fufs and Use end 90 che eeruua fiscal
ysar far ehieh fhs hadErf provides
for ths necessary running sxpeuses
- enc department in uHrstinn ~ BEL
obtions thaf fhvre shogld be- some
csntral financial aRenrt elfh author
ily to withhold pari ~ ihe money
Appropriated Scr running expenses 20
a state department ~ Institution. aF
Justified 20 changes n market Cnndi-
fi0ns aud other unforeseen occur
Fences. which would materially change
the cost ~ operating ans particular
tenn Is merely "a give the departments
the amount believed necessary when
the estimate Is made under conditions
existing from eight 20 thirty-two
months IN advance OF the actual per
iod Of disbursement
Under the Maryland financial sys-
tenn. as al present organized. the
Treasury Department i able TO exert
only mere limited power OF review
over the disbursement OF substan-
tial part OF the States revenue. APP
proximately 100000 annually of the
States revenue is retained by the de-
partments which collect this revenue
and is held by these departments UNI
Ill disbursed TO meet part OF the
departments running expenses The
State Treasury Department has no in
fiuence at all upon this type of col
lection or disbursement. and is only
able 10 audit these accounts when
they have become matter OF his
tory Such a condition allows the de
partment collecting. holding and
! spending such public funds financial
functions which are the only reasons
for the existence OF a State Treasury
Department.
Each and every branch OF the State
government under the present system
requires sufficient appropriation 10
make its own disbursements. to do the
required bookkeeping necessary TO
these disbursements. and requires in
addition sufficient attention from the
State Auditors department 20 provide
a subsequent check on all of these
departmental disbursements. This un-
necessary work I'm each branch OF the
State government, in itself requires "a
much greater total outlay Of State
money than direct disbursement from
a central office 90 financial review and
control would cost: I'M fact the pres
ent Compiroller'S Office. when reor-
ganized with more modern methods
Of accounting and disburSing. as il
will be by the end OF the present lis
cal year as far as the existing law
authorizes. is capable of making di-
rect disbursements for all the agen-
cies % the State government at
maximum increase of not NOR than
ten per cent OF the total cost OF the
present decen,ralized system of dis
bursement Al conservative esti-
male. the COmptroller's Office is con
WINGED that the present cost OF de-
centralized disbursement is over sac
000 year
Another great weakness in the
present system of decentralized dis