Thank you, Johnny.
You leave enormous shoes to fill. And it’s not just because you’re, like, 6’8.
You’re a champion for every single jurisdiction, from Mountain Maryland to the Eastern Shore –
And on a personal note: You’ve been a true friend.
I also want to recognize the incoming MACo President, Jack Wilson.
Jack: Congratulations, and I look forward to working with you and your team in 2025.
I want to thank Michael Sanderson, Virginia White, Kevin Kinnally, and the entire MACo Team
for their partnership.
Michael, Virginia, and Kevin have been in constant communication with our team. And they’ve
told us about the concerns of the people in this room.
I know we are facing steep challenges. Maryland is in the path of two storms:
First, we face an historic budget crisis, the likes of which we haven’t seen in decades…
And second, we are about to swear in a new administration in Washington. D.C. that casts
uncertainty on our future.
And in thinking about the message I wanted to share this evening, I was reminded of a slogan
that holds special significance in Maryland…
Just down the street from my office is the United States Naval Academy.
Now, I’m an Army guy. But I have to admit, the Navy had it right when they came up with their
battle cry… “Don’t give up the ship.”
SO TONIGHT, let’s talk about the nature of the two storms gathering around us…
And let’s find new ways to work together and ensure that in this moment, Maryland says, in one
voice: “We don’t give up the ship.”
So first: We know Maryland is staring down the biggest budget crisis of the last twenty years.
When I took office, we inherited bloated budgets, sluggish growth, and a structural deficit.
From 2017 to 2022, the national economy grew by 11%. In that same time frame, Maryland’s
economy grew by just 3%: One-fourth the national pace.
We’ve ranked consistently low on measurements of affordability, wages, population size, and
employment.
High prices across the country have also been affecting how much money moves through our
economy.
But even though we weren’t growing before I took office, we were spending.
State budgets increased by 70% during the seven years before I took office.
And I know this isn’t exactly the politically convenient thing to say….
But bigger budgets don’t always correlate to better results. And that is distinctly true when you
have slow economic growth.
Now, Maryland and every other state in the nation benefited from billions of dollars in federal
money to get us through the COVID-19 pandemic –
But billions of dollars from the federal government was not a structural surplus… It was a sugar
high.
Over the last two years, our administration has made targeted cuts and responsible investments to
narrow the budget gap.
We’ve prioritized government efficiency and data, so we are actually spending smarter to get
the results that matter.
A few months ago, we used a data-backed approach to tackle child hunger – And that strategy
helped us feed an additional 500,000 kids when school meals were unavailable for summer
break.
Since taking office, I’ve also signed legislation to support our entrepreneurs and build access to
work, wages, and wealth.
We improved coordination in public safety, to help make our communities places where families
want to live, work, and grow…
And according to preliminary data, homicides are down 13% year-on-year –
Auto theft is down 26% –
And non-fatal shootings are down 27%.
We also made the choice to invest in child care and ensure more Marylanders could join the
workforce without a college degree…
Today, Maryland has among the lowest unemployment rates in the country –
And just three weeks ago, Maryland was ranked the top state in the country for minority-owned
businesses.
We are moving forward.
But a fiscal challenge almost a decade in the making can’t be solved in less than two years.
Since at least 2017, the Department of Legislative Services has been forecasting structural
budget deficits in the State of Maryland.
Now, those predictions have come to pass.
As we head into 2025, our state is faced with a $2.7 billion budget shortfall.
And as we take on this budget crisis, we also see other storm clouds approaching.
Maryland is always affected by the outcome of any Presidential Election – because Maryland
and the federal government are deeply intertwined.
The federal government is our biggest employer, with over 160,000 federal employees in our
state.
Federal funds account for thirty percent of our annual state budget.
This money goes toward supporting health care, income security, education, transportation,
housing, labor, and the environment.
Maryland is uniquely reliant on federal coffers. And historically, our state has been able to coast
on that comfort.
As a result, we’re vulnerable to changes in our nation’s capital.
Many of the decisions that happen inside the White House will be outside of our control.
Those decisions will have a direct impact on our state and local governments – and inform our
fiscal trajectory.
I want to be clear: we are ready to work with the incoming administration to advance the interests
of Marylanders. And where we can partner, we will.
I believe there is still space for alignment, including on issues of transportation and infrastructure.
But that doesn’t change the reality of how these two storms coalesce.
At a time when we face an historic fiscal crisis, we ALSO can’t count on the federal government
to fill in the gaps of our balance sheet.
I know these storms are daunting.
But in Maryland, we don’t run from the big challenges. We run toward them – and we come up
with solutions together.
The answer to making it through each of these storms can be captured in a single word: Growth.
If our economy was growing more rapidly, we wouldn’t be dealing with this kind of historic
budget crisis.
If our economy was growing more rapidly, we could better withstand changes in Washington
and around the country.
We need to grow. It’s the key to securing Maryland’s future.
Anyone who thinks we can just cut our way to greater prosperity isn’t being honest.
Anyone who thinks we can just tax our way to greater prosperity is not being honest.
Now is the time for us to make the hard choices that will help us build a durable economy – One
that is business-friendly and invests in growth.
In the next few days, I will be signing an executive order centered on strengthening Maryland’s
economic competitiveness.
This will be the most sweeping economic executive action I have taken since being sworn in as
the 63rd Governor of Maryland. It has three main parts.
First: Our executive order will streamline the permitting process.
Other leaders across the country are moving forward with permitting reform to drive growth,
while still being good environmental stewards.
If Maryland doesn’t do the same, we will fall behind.
We cannot attract businesses if it takes years to get a permit from the State and local
jurisdictions.
We need to cut red tape that slows down permitting unnecessarily – and my executive order will
help us do exactly that.
Second, our executive order will initiate an all-of-government strategy for prioritizing the sectors
Maryland stands to win.
Our state’s economy has focused on three main areas for decades: The eds, the feds, and the
meds.
We will always protect our legacy assets.
But we also need to build on that foundation.
We have studied the data. And our administration has identified THREE NEW core areas that
are central to our future growth…
They are life sciences; I.T.; and Aerospace and Defense.
These three areas open the door to economic dominance in the modern economy.
I’m talking about areas like cybersecurity and computational biology…
I’m talking about areas like artificial intelligence and quantum computing…
And these are areas where Maryland is uniquely positioned to win, because we have the right
assets.
We are the home of NIST and NASA Goddard…
Fort Meade and US Cybercommand…
The UMD System and our biohealth cluster…
We need to uplift these assets. Doing otherwise wouldn’t just be foolish – it would be derelict.
Maryland is ready to bet big on the future.
It’s what Massachusetts did, when key stakeholders came together and bet big on biotech.
It’s what Kentucky did, when key stakeholders came together and bet big on EV batteries.
Let’s be clear: I want Maryland to be the best state to do business for any industry.
But focus and strategy are how we attract, retain, and grow businesses, investment, and talent.
This brings me to a third key element of our executive order:
Coordinating economic development efforts with local governments.
The State of Maryland can do everything in our power to drive economic growth. But if we
aren’t aligned with our jurisdictions, we won’t succeed.
Our economic destinies are tied together.
That’s why my Executive Order directs all parts of my administration to ensure better
coordination with local governments on economic growth.
Those are the three key pieces of the executive order I will sign:
Permitting reform – Making big bets on life sciences, IT, and aerospace and defense – and
improving coordination with our local partners.
And in order to support the kind of growth that our administration will demand, there are still
two items we have to address tonight…
They are prerequisites for making Maryland desirable for business and industries…
I’m talking about investing in world-class schools and increasing housing supply.
So let’s talk about education.
We know a world-class education system is a necessity for all of our dreams as chief executives
– and the dreams of future generations.
The Blueprint for Maryland’s Future is – and will remain – a central piece of our education
strategy.
But if legislative history is any teacher, we know two things about laws of enormous
significance:
They must ALWAYS be refined after they have been passed – and they cannot succeed alone.
Remember: The law creating Social Security has been amended over twelve times. The
Maryland Constitution has been amended around 200 times.
The passage of the Blueprint wasn’t the end of our work on education – it was only the
beginning.
In our first year, we introduced the Educator Shortage Act, to improve the teacher pipeline –
And to date, we have seen a 25 percent reduction in teacher vacancies since our law took effect.
This past session, I signed a new Grow Your Own program to expand student-teacher stipends
and train more teachers.
In our first two years, we increased state funding for our schools by 50% compared to my
predecessors' first four years.
NOW, our work continues.
This legislative session, I will introduce an education bill that builds on the Blueprint to help
ensure that our children receive a world-class education.
Our legislation will take aim at the single biggest challenge we face in education: And that’s the
ongoing Maryland teacher shortage.
Today, 4% of our classroom positions are unfilled. That’s nearly 1,600 classrooms of children
without an experienced educator in front of them.
6,000 educators are teaching under a provisional certification, which means they are not fully
trained and licensed.
If we don't get a high-quality, trained, dedicated teacher in every classroom, the Blueprint itself
is bound to fail.
Our new legislation tackles the teacher shortage in two major ways.
First, we will build off the foundation of the Educator Shortage Act by proposing new efforts to
strengthen the teacher training pipeline.
Second, we will issue reforms to the Blueprint for Maryland’s Future.
The Blueprint calls for increased time for educators to engage in curriculum planning, grading,
and professional development outside of the classroom.
This is also commonly known in the education industry as “collaborative time.”
It ensures that our educators have additional breathing room to work together to sharpen their
skills and better support our students.
Let’s be clear: Teachers should be treated like professionals and be empowered to work together
outside of class.
But we need to think through implementation… and we need to do the hard work of first
strengthening the teacher pipeline…
Because it’s hard to have meaningful collaborative time for people who aren’t even in the
building.
We would need an estimated 15,000 more teachers to implement collaborative time successfully.
This year, I will propose a pause in the implementation of the collaborative time provisions in
the Blueprint for Maryland’s Future.
Our goal is to give school districts time to recruit and retain enough teachers.
And while we pause collaborative time, I will also be proposing new short-term grants to schools
that want to experiment with collaborative time models.
I believe in the promise of the Blueprint. But the realization of that promise doesn't come
through strict adherence to formulas, at all costs…
The realization of that promise comes from making sure our investments are linked to student
success.
Our fidelity is to students, not formulas.
We will implement the parts of the Blueprint we know work, including investments in preschool
and a focus on early literacy and tutoring…
We will pause the elements that need a closer look or require laying a stronger foundation for
full implementation…
And we will continue to craft and pass legislation to elevate education.
To win the decade, we need to provide a world-class education to every student. That will
continue to be our pledge and our push.
15,000 is our target to implement collaborative time.
And while we move forward on education, I also want to talk about another number: 96,000.
That is the housing gap in our state: We have a shortage of 96,000 homes.
It’s a shortage that is dragging down affordability, economic strength, and business growth.
Now, since inauguration day, we’ve created over 50,000 new jobs in the State of Maryland.
CEO’s are taking notice. And they want to be a part of what we’re doing.
But I can tell you that one of the first questions I get from CEO’s when they’re thinking about
coming to Maryland is about housing.
When I talk to students, they tell me they’re thinking about moving to a different state because of
high housing costs –
And we know that one-in-three younger Marylanders are thinking about doing the same.
When I talk to teachers and police officers they tell me they aren’t sure if they can continue to
make rent or save up for a down-payment.
If we don’t address housing, we will never unlock our full potential...
This past year, we worked with the General Assembly to pass the most comprehensive housing
package of any governor in recent history.
It’s not lost on me that our housing package couldn’t have gotten passed without partnership
with MACo.
I want to thank this community for always coming to the table to address the tough issues.
But I also want to be clear: Our work isn’t done.
We can’t have an honest conversation about growing our economy without directly addressing
the housing supply and affordability crisis.
And this upcoming session, I will introduce legislation to ensure that we are building more
housing in the State of Maryland.
In the coming weeks, you will hear more details about our legislative package and our budget.
In every piece of our agenda, you will see a clear emphasis on economic growth.
Growth is the most powerful tool we have in our toolbox.
But it is not – and cannot be – the only one.
We are in a moment of profound consequence, and we are willing to use every tool in our
toolbox if it means getting Maryland’s fiscal health on track.
There will be choices in our new budget that some of you will not like. Quite frankly, there will
be choices in our new budget that I don’t particularly like.
But we need to make hard choices now if we want to unleash our full potential as a state and lay
the foundation for a brighter future.
We will continue to protect the areas that matter most to Marylanders, like education, health
care, child care, transportation, public safety, and housing.
And as we closely evaluate spending levels, we are also working with our Performance Cabinet
to ensure that where we do direct money, we get a strong return for that investment.
All of us are going to be governing together in a moment of crisis for our state.
It will require a measure of discipline and grace from each and every one of us.
There will be moments where all of us get frustrated – even overwhelmed.
But in Maryland, we don’t give up the ship, no matter how rough the surf and how violent the
winds. That is who we truly are.
I know the people in this room. I know the strength and the courage that you bring to every
single challenge… Because I’ve seen it.
I saw it on the Eastern Shore, when we broke ground on a new hospital just a few weeks ago.
At a time when every other state seems to be moving away from rural health care, we said
“we’re going to lean in.”
I saw it in Mountain Maryland, when I met with leaders at the Washington County Public Safety
Center, who are helping us stem violent crime.
At a time when Marylanders are calling on us to prioritize safety, we are making the choice to
invest.
I saw it in Baltimore after the Francis Scott Key Bridge collapsed – and we came back stronger
than ever.
Everyone said it could take up to eleven months to re-open the channel. We got it done in eleven
weeks.
We are Maryland. Winning is what we do.
We REFUSE to run from these two storms.
We are going to navigate them both, together – and we will emerge stronger.
There are some people who look at a challenge, and they flinch. People are learning that this
administration and this state do not flinch.
We're built differently – and we meet moments.
And by meeting this moment, head-on, we are going to show people what it means to leave no
one behind.
Thank you so much, and let’s keep up the work.