The Trump administration’s mass layoffs and spending cuts are making Maryland’s already-cloudy budget picture darker, with the state’s financial experts predicting that even less money will come into state coffers.

The new economic forecast out Thursday showed that the state should take in about $107 million less in taxes for the current budget year than expected, plus another $173 million less for the state budget year that starts July 1.

The reduced expectations are tied to the economic slowdown that’s expected due to thousands of Marylanders losing their jobs, either directly or indirectly, because of the actions of President Donald Trump and his cost-cutting “DOGE Service,” officials said.

About 11,000 Maryland workers have already lost or are about to lose their jobs, and future actions could bring that number of job losses up to 28,000, said Robert J. Rehrmann, the state’s top economic forecasting expert.

That makes the job of balancing the state government’s $67 billion budget more challenging and will force politicians to confront difficult decisions about further raising taxes or cutting government programs.

“We are witnessing the direct, real and painful results of the Trump administration’s chaotic moves in Washington,” said Sen. Guy Guzzone, chair of the Senate Budget and Taxation Committee.

Maryland’s economy is uniquely tied to the federal government, with nearly 10% of households reporting income from the federal government. In some Southern Maryland counties, where there’s a big military presence, one-fifth of personal income is from federal jobs.

When people lose their jobs, they pay less income tax to the state and they spend less money on goods that are subject to the sales tax.

Trump’s actions are causing “a negative shock to our economy” and a “worst-case scenario,” Rehrmann said.

With the effects of Trump’s actions only beginning to ripple into the economy, things could get worse, officials warned. The forecast doesn’t include the potential of cuts in federal money that goes straight into the state budget for programs like Medicaid health insurance, nor does it capture potential economic fallout from tariffs on goods shipped through the Port of Baltimore.

“We’re all for government efficiency, but this is not that,” said Comptroller Brooke Lierman, a Democrat.

Treasurer Dereck Davis, also a Democrat, was blunt in his assessment.

“Madame Comptroller told me I couldn’t swear. So I won’t say what kind of show we have going on,” Davis said. “But if you think about it, you can figure it out.”

“These federal actions are slowing the nation’s economic growth already. ... We must prepare for outsized impacts to Maryland’s economy and our state revenues,” said Helene Grady, Gov. Wes Moore’s budget secretary.

Lierman, Davis and Grady signed off on the new economic forecast on Thursday, sending it to state lawmakers who will make the final decisions on how to achieve a balanced budget in the coming weeks.

The General Assembly’s budget leaders, Guzzone and Del. Ben Barnes, told reporters that tough decisions lie ahead.

Barnes, who chairs the House of Delegates Appropriations Committee, said the financial news is “clearly sobering.”

“It reflects a president, Donald Trump, who is intent on decimating our federal workforce, cutting services for those who need it most, and in doing so, wrecking our economy,” said Barnes, a Democrat who represents parts of Prince George’s and Anne Arundel counties.

Even before Trump took office, Maryland was facing a gap of about $3 billion between the amount of money coming into state coffers and the amount of planned spending. Moore proposed closing that gap with a combination of funding cuts and increases in taxes, primarily on the state’s highest earners and through corporate tax changes. He worked in a modest tax cut for moderate earners.

But nearly every element of Moore’s plan has been criticized by some faction of Marylanders. Lawmakers who were already working to restore some of Moore’s proposed cuts now have a tougher job ahead of them.

Moore told The Banner that he’s been “personally engaged” with top lawmakers on how to find a way forward on the budget.

Nonpartisan analysts who advise lawmakers have put forward a long list of ideas for further spending cuts and ways to raise money, and lawmakers have come up with their own, including a 2.5% tax on services that businesses sell to other businesses.

Barnes and Guzzone, speaking to reporters Thursday, did not tip their hand about what combination of cuts and tax increases could be included in the final budget, which will guide state spending for 12 months starting July 1.

“It’s going to be incumbent on the two budget chairs, as well as the presiding officers, and the entire chamber, to get together in the coming days to figure out how we can absorb these really draconian cuts created by Donald Trump and Elon Musk and their cronies in Washington, D.C., their DOGE bros,” Barnes said.

Barnes and Guzzone said all options are on the table, and there will likely be both more cuts and more tax or fee increases.

“It’s all there on the table,” said Guzzone, a Howard County Democrat. “We’ve got to figure out the best move, and to protect Marylanders in the best way.”

Republican lawmakers, who are far outnumbered in Annapolis, said Democrats should not use the worsening economic picture as a justification for tax increases. In a statement, Republican leaders called out the business-to-business tax and a tax on sugary drinks as proposals that should not be considered.

“Maryland has got to get control of its spending,” Del. Jason Buckel, an Allegany County Republican and House minority leader, said in the statement. “We have to take a hard look at how we are spending money and realize we cannot afford a Mercedes government with a Honda economy.”