During an afternoon visit yesterday to Baltimore’s State Center, Gov. Martin O’Malley touted a new law that encourages “transit-oriented development” around commuter trains, buses stops and other public transportation outposts.

State Center, home to 3,500 Maryland employees, right on the Light Rail and Baltimore Metro, is targeted for an office, residential and retail project. O’Malley wants to see more of this.

The O’Malley-backed law drew relatively-little opposition during the just-concluded legislative session, probably because it didn’t cost anything. It establishes transit oriented development as a transportation goal, but that’s about it. Some Republicans had fun with that in the Senate, trying to get an explanation for how exactly it would achieve anything.

But putting the goal in policy can open up funding opportunities, and also clears up legal confusion over whether train and bus stations can be part of development plans.

Wall Street is keeping a close eye on State Circle today as the General Assembly continues to work through a bill that would finalize a proposed settlement between the state and Constellation Energy Group Inc.

The deal is in trouble because the Senate’s version of the bill includes requirements for new power plants in Maryland to be regulated by the Public Service Commission. The Senate gave final passage to its version of the bill Friday morning, but must still agree with the House on a bill to send to Gov. O’Malley.

Constellation is distributing copies of analyst research Friday morning, and from what I’ve seen, investors don’t like the look of the move by the Senate.

“The amendment, if passed by the full legislature, would kill the deal. It would also put power plant investments planned in the state by CEG (a new nuclear plant at Calvert Cliffs) and others in doubt, worsening the supply/demand backdrop,” Citigroup Global Markets wrote in a research note issued Friday.

So what does Maryland’s increasingly bleak revenue picture say about the economy? According to the state’s Board of Revenue Estimates, nothing good.

Since December, when the board last estimated state government revenue, the picture has gotten worse. The board predicted Thursday that the state would get $74.7 million less than it expected during fiscal 2008, which ends in July, and $258.2 million less than it hoped in fiscal 2009.

Here’s a clip from the board’s letter to Gov. Martin O’Malley. Excuse the length, but I think it’s telling.

“The national economy has slowed faster than expected at the time of our December forecast. At that time, consensus opinion was that the United States would skirt a recession. Now, with real GDP growth slowing to 0.6% in the fourth quarter of 2007 and 17,000 jobs lost in January, many respected economists believe we are in the midst of a recession, though likely a shallow and short one. As you are aware, trouble in the housing market has spread to credit markets, and both consumer and business confidence have suffered.”

Two of the revenue sources that have suffered most are personal income tax and sales tax. Those are the state’s two largest cash cows, and the board writes that they are also sensitive to economic changes.

So what does this tell you? How telling of a barometer do you feel that the state’s balance sheet is for the wider economy?

The “R” word is being thrown around a lot, and we may not know we’re in a recession until it’s been going on for awhile. I have to wonder whether the definition really matters at this point.

Maryland’s state government gets a “B” in management, according to a report issued this month by the Pew Center on the States. It’s a pretty good rating, compared with the rest of the country (Virginia beats us with an “A-,“ and is tied with Utah and Washington State for tops on the list).

One of the most prominent issues in the study is government accountability.

The Pew researchers took quite a shine to Gov. Martin O’Malley and his work in last year’s special tax-raising legislative session. It also lauds the goals of O’Malley’s StateStat performance measurement program, but faults aspects of the state’s information technology system.

“The impact of StateStat will not be known for a long time—there are obvious snags in converting a city system to a much larger entity with less-than-spectacular information technology,” the report (check it out) reads, comparing the system to Baltimore’s CitiStat system. “But promoters of StateStat believe that the obstacles can be overcome and that the system will generate savings proportional to the millions accrued in Baltimore.”

It’s hard to tell right from wrong in the complicated debate over state school’s superintendent Nancy Grasmick’s future. Many had called for her ouster after the state school board, with the support of outgoing Republican appointees, extended Grasmick’s contract, and legislators were looking for creative ways to reverse the board’s action.

One proposal that was being bandied about was a move to prevent a “lame duck” board from extending a contract. But Gov. Martin O’Malley’s public burial of the hatchet with Grasmick yesterday appears to have put a damper on that effort.

Anyway, I’m curious about how people view the situation. Was it proper for the board to extend the contract when members knew Gov. O’Malley was preparing to reconstitute it? Is that the board members’ right, or should they respect a new administration’s intentions? On the other hand, it’s always a bad precedent to change established law based on one objectionable development.

What do you think?

Above: Gov. O’Malley, hoping to put an unproductive political feud behind him, shook hands with Schools Superintendent Nancy Grasmick on Monday, pledging to work hard on education initiatives - instead of her removal. (AP Photo/Brian Witte)

Gov. Martin O’Malley repeated his outrage today over the “appalling” threats of Constellation Energy to sue its ratepayers for $386 million the company said it was bullied into giving up.

O’Malley pledged to “spare no expense” in order to stand up for the interests of Marylanders. What level of spending do you think is justified, given the state’s recent fiscal woes? He also said he would be open to moves that would help the state make electricity prices more predictable.

Suggestions on how to do that have abounded.

Sen. E.J. Pipkin, the self-proclaimed “fighter for the ratepayer,” and Republican candidate for Maryland’s hard fought 1st Congressional District seat, said the legislature needs to focus on returning the state back to re-regulating the energy market. What do you think? Will re-regulation be the answer to Maryland’s energy issues?

DANIELLE ULMAN, Business Writer

What’s in a name? Well, at least an indication of tone and meaning, as evidenced by Gov. Martin O’Malley’s education funding announcement on Wednesday.

Maryland’s annual “beg-a-thon,” where school districts from around the state come before the Board of Public Works to compete for school construction dollars, has a new moniker.

In a press release, O’Malley now calls the event a “hope-a-thon,” which allows “school superintendents to have a more meaningful conversation with the Board of Public Works on their jurisdiction’s key school priorities.”

School officials were asking for part of an unallocated $108 million out of $333 million in state aid for public school construction funding planned for fiscal 2009.

How about this new name? Do you think it’s a more accurate representation of the event, or is the BPW off-base?

Above: This newly-built complex in Howard County includes Reservoir High, Lime Kiln Middle, and Fulton Elementary schools. Image courtesy of Johns Hopkins APL.

Gov. O’Malley wants to spend $11 million to improve Broening Highway, an important access road for the Port of Baltimore.

He announced Tuesday morning that he had added the project to the state’s transportation plan that runs from July through 2013. The project is intended to ease truck transportation to and from the port, and improve the connection with Interstate 95, O’Malley said.

No word on plans for the port’s highest-profile project, a deepening of the berth at Seagirt Marine Terminal. That project will take awhile to get moving because it’s expected to cost up to $130 million. Port officials are looking for a public-private partnership to get that one off the ground. (subscriber-only link)

Gov. Martin O’Malley’s proposed budget might have an easy passage through the General Assembly this year, according to Senate Budget and Taxation Chairman Ulysses Currie. He said at a legislative function Monday that he won’t have to cut O’Malley’s budget because it is below spending limits set by lawmakers earlier this month.

What O’Malley needs now is support from the public and from lawmakers, Currie said.

An interesting story written Monday by Tom LoBianco of The Washington Times examines how O’Malley sold his proposed solution for a $1.5 billion budget deficit to the public. He compares it to former Virginia Gov. Mark Warner’s quest to fix his state’s finances in 2004.

Here’s an excerpt from what Tom wrote.

Mr. Warner was hailed in national Democratic circles for doing the near-impossible: increasing taxes and improving his approval rating.

But after Maryland’s special session closed in November, Mr. O’Malley’s public-approval rating dropped — not the outcome called for in the Warner playbook.

An analysis by The Washington Times and interviews with key Virginia leaders shows Mr. O’Malley, a Democrat, followed a more abbreviated version of the Warner plan, and suffered politically as a result.