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December 1, 2021

The Talbot Spy

The nonprofit e-newspaper for the Talbot County Community

News Maryland News

Foxwell, Franchot’s Former Top Adviser, Launching Communications Firm

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Len Foxwell, the veteran political strategist who until recently was the longtime top adviser to Maryland Comptroller Peter V.R. Franchot (D), is setting up his own communications shop.

Foxwell on Thursday is set to announce the creation of Tred Avon Strategies ― a firm named after the Tred Avon River, a tributary of the Choptank on the Eastern Shore, where Foxwell grew up and lives.

“As the founder, principal and only full-time employee of this new firm, I’m excited about the chance to put my 25 years of experience at the highest levels of Maryland politics and government to work on behalf of my clients,” Foxwell says in a Facebook post that’s due to go live Thursday morning. “Whether you are a business owner trying to survive the most volatile economy of our lifetime, an aspirant for political office, or a community advocate who is fighting for meaningful change, I’ll be there for every step of your journey.”

Foxwell will work out of the Annapolis office of Capitol Strategies, LLC, the lobbying firm at One State Circle, across the street from the State House. His firm will have an administrative relationship with Capitol Strategies but will otherwise be an independent entity.

One of the partners at Capitol Strategies is Sushant Sidh, Foxwell’s brother-in-law. Foxwell in his Facebook message refers to Sidh and Capitol Strategies’ other principal, David Carroll, as his “strategic partners.”

Foxwell was asked to resign as Franchot’s chief of staff earlier this fall, following the former’s admission of a personal indiscretion. He had been the comptroller’s top aide since 2008 and had been advising Franchot ― formally or informally ― for almost two decades.

Foxwell has been an integral part of Franchot’s political rise, and the comptroller earlier this week announced that he had hired the Baltimore-based consulting firm Tidemore Strategies to be his principal advisers for his 2022 gubernatorial campaign.

But Foxwell also became a lightning rod for controversy in recent years, with provocative social media posts that attacked Democratic leaders and conservative Republicans.

Foxwell’s career began well before his time with Franchot. He served in a variety of political and policy roles under former Gov. Parris N. Glendening (D); worked on the gubernatorial campaign of former Lt. Gov. Kathleen Kennedy Townsend (D); was community and government relations director for Salisbury University, his alma mater; and was director of government relations for the Greater Washington Board of Trade. He also teaches a communications course at Johns Hopkins University.

Foxwell has also offered informal advice to scores of politicians, including Gov. Lawrence J. Hogan Jr. (R), community groups and business entities ― especially the state’s craft brewery industry, which Foxwell and Franchot have fiercely championed.

Tred Avon Strategies’ new website features testimonials from state Sen. Mary L. Washington (D-Baltimore City), Salisbury Mayor Jacob Day, and Julie Verratti, co-owner of Denizens Brewing Co., which has tap rooms in Silver Spring and Riverdale.

Foxwell is hanging his shingle at the start of a consequential election cycle in Maryland and his services could be quite sought after.

In an interview, Foxwell said he had signed up a few clients but wasn’t prepared to name them yet.

“I’m going to allow them to announce our relationship on their own timeframe,” he said.

By Josh Kurtz

Study Shows Dramatically More Flooding in Md.’s Future

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Four out of five coastal Maryland communities regularly monitored by the federal government experienced a record number of days of high-tide flooding in 2019, according to a study issued Tuesday. The fifth community withstood its greatest number of high-tide flooding days — a phenomenon where a coastal area floods even if there has been no rain or severe weather — in 2018.

The study, issued by the National Oceanographic and Atmospheric Administration, suggests that an increasing amount of high-tide flooding — often seen as a harbinger of climate change — is almost certain to occur in Maryland and other coastal states in the years ahead. The acceleration is going to begin this year, the agency projects.

“America’s coastal communities and their economies are suffering from the effects of high tide flooding, and it’s only going to increase in the future,” said Nicole LeBoeuf, acting director of NOAA’s National Ocean Service.

Nationwide, coastal communities saw a median flood frequency of four days in 2019, just shy of the record set in 2018. However, 19 locations along the East and Gulf coasts set or tied records, and rapidly increasing trends in high-tide flooding have emerged.

The phenomenon is also known as sunny-day flooding or nuisance flooding and can be exacerbated dramatically by rain storms.

Annapolis saw 18 days of high-tide flooding last year, a record. Also setting records in Maryland last year were Tolchester Beach in Kent County (17 days), Cambridge (11 days) and Solomons Island (11 days). Baltimore City hit its record number of high-tide flooding days — 12 — in 2018, and recorded 11 such days last year.

Twenty years ago, NOAA reported, these communities barely experienced any high-tide flooding. For Cambridge and Solomons Island, it typically happened once a year; in Tolchester Beach and Annapolis, it happened twice a year; and Baltimore City experienced the phenomenon three times a year.

NOAA made projections for high-tide flood days for 2020, 2030 and 2050 — and the problem is expected to grow exponentially.

“As a Chesapeake Bay resident, I see the flooding first hand and it is getting worse. Records seem to be set every year,” said William Sweet, an oceanographer for NOAA’s National Ocean Service and lead author of the report. “Communities are straddled with this growing problem. Fortunately, NOAA’s tide gauge network is keeping a close watch and helping us provide guidance about the disruptive flooding that is likely next year and for decades to come.”

Here are the projections for the five Maryland communities that NOAA monitors:

2020

Cambridge 5-8 days

Tolchester Beach 7-12 days

Baltimore City 5-9 days

Annapolis 6-10 days

Solomons Island 6-9 days

2030

Cambridge 9-20 days

Tolchester Beach 15-25 days

Baltimore City 15-25 days

Annapolis 15-25 days

Solomons Island 10-20 days

2050

Cambridge 40-150 days

Tolchester Beach 50-160 days

Baltimore City 50-155 days

Annapolis 55-170 days

Solomons Island 45-165 days

By Josh Kurtz

Spying in Annapolis: Mayor Gavin Buckley

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Editor’s note: Well before the COVID-19 crisis emerged, Spy Community Media, the nonprofit parent of the Chestertown Spy and Talbot Spy, had concluded that the city of Annapolis would join its sister publications in providing an online educational resource for its community. We intend to start that publication soon. In the meantime, we wanted to share with our existing readers, many of whom have their own unique relationship with the capital city, content that eventually find its way unto a new Spy in Annapolis.

We begin with Gavin Buckley, mayor of Annapolis. In his first interview with the Spy, the Spy catches up on how this Australian found his way to city hall after a life of sailing and a downtown merchant. Mayor Buckley also talks directly about the coronavirus impact of a town highly dependent on the hospitality sector and plans moving forward.

This video is approximately ten minutes in length. For more information about the city of Annapolis please go here.

Maryland Could Make Daylight Saving Time Permanent

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At 2 a.m. Sunday, hundreds of millions of Americans will “spring forward” one hour in the annual observance of Daylight Saving Time — gaining an hour of sunlight but losing an hour of sleep.

Some Maryland lawmakers are aiming to change that.

Whether it’s gaining an hour or losing an hour, the time change can be disruptive.

In the fall, the days feel shorter, sometimes leaving people to start and end their day in darkness. In the spring, when Daylight Saving Time begins with losing an hour, changes to sleep schedules can impact people in a variety of ways.

Legislation in the General Assembly would alter Maryland’s standard time to be Eastern Daylight Time year-round.

If passed, the legislation would be contingent on changes being made to the federal Uniform Time Act, which allows states to exempt themselves from observing Daylight Saving Time, but requires a change in federal law to remain on Daylight Saving Time year-round.

Currently, Hawaii and Arizona are the only two states that do not observe Daylight Saving Time.

“We have a whole host of reasons on why we do this daylight savings, but they all seem antiquated in theories,” said Delegate Brian Crosby, D-St. Mary’s, sponsor of House bill 1610. “When you start breaking down the data of why to not do it, that far outweighs why we do do it.”

The modern practice of observing Daylight Saving Time began with the Uniform Time Act in 1966.

According to a legislative analysis of the bill, the act was passed when the U.S. Department of Transportation was founded, giving the department regulatory power over time zones and Daylight Saving Time for transportation and commerce-related issues.

The first U.S. Daylight Saving Time was observed for energy conservation for seven months between 1918 and 1919 and year-round between 1942 and 1945, during World War I and World War II.

But a 1974 report by the U.S. Department of Transportation found the energy savings minimal, and a 2008 Department of Energy study found a total primary energy consumption reduction of 0.02%, according to the state legislative analysis.

Between 2015 and 2019, 39 states introduced legislation to abolish the observance, with many states seeking to keep their clocks set one hour ahead, according to data from the Congressional Research Service cited in the legislative analysis.

On March 11, President Donald Trump weighed in, tweeting “Making Daylight Saving Time permanent is O.K. with me!”

If the Maryland legislation passes, it would take effect the second Sunday in March or the first Sunday in November after the change is made to federal law, whichever occurs first.

Sen. Clarence Lam, D-Howard and Baltimore counties and a co-sponsor of Senate bill 517, which is expected to be heard Thursday, said he has heard the time change is considered outdated and not needed by some of the state’s agricultural communities. Crosby’s identical House bill does not yet have a hearing scheduled.

“In my district, we don’t have very many farms, so it seemed like it made sense to me to give a little bit more time in the day where there is daylight occurring,” Lam said.

Crosby pointed to published research that shows the detrimental health effects Daylight Saving Time can have on people. Studies show an increased chance of heart attacks, accidents while driving, increased work injuries and a temporary increase in suicides in the days after the spring time change.

“To me, it’s a quality-of-life issue,” he said.

Crosby also noted the effect the yearly time change can have on parents with children.

“Nobody likes getting their kids up for school the next day,” Crosby said. “I promise you, on March 9th, parents will be struggling to get their kids out the door.”

By Jeff Barnes

Op-Ed: Report from Annapolis 2020 by Laura Price

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Since I spent the past two weeks reporting on all Kirwan, I wanted to catch you up on our long list of bills that MACo did discuss and take positions on.  There really is legislation outside of Education spending and the Sales and Service tax hike, but you will see that many of these bills do tie back in to the big education bill!

Did you think that property tax was a flat rate?  This bill, HB1276, “County Property Tax – Classifications of Real Property and Authority to Set Special Rates” may change that.  This authorizes a county to set special property tax rates on any sub-class of real property. Properties such as agriculture land, marsh land, small and large commercial properties, industrial, residential condos/rentals and residential greater than 5000 square feet.  While counties could theoretically charge a lower rate, a county could also charge a higher property tax rate. This could mean having “progressive” property tax rates. MACo supported the bill because it “authorizes” county control, however, it’s just another way to raise taxes to pay for Kirwan.

A bill that could tax some Marylanders even more is HB1494, “County Income Tax – Maximum Rate and Authority to Impose on an Income Bracket Basis.”  This increases from 3.2% to 3.5% as a maximum a county could impose on an individual’s taxable income. It would also require that a county not charge the lower rate to certain income levels, if they have set this bracket policy by ordinance.  MACo decided to take no position because we don’t know how it might affect disparity grants or the education “effort” of a county. We believe that this type of bill should wait until next year and the State has acted on an amended version of Kirwan.

Then there are bills that continue to limit or reduce County revenues, just when we need them more than ever.  HB1280, “Admissions and Amusement Tax – Small Business Exemption”, would prohibit a county from imposing this tax on businesses with less than $75,000 in gross receipts.  MACo mostly opposes bills that impose State mandates, revenue decreases or spending increases. HB1451, “School Bus Purchasing – Zero Emission Requirement,” would be such a bill, requiring that each school bus be a zero-emission vehicle.  This is unworkable. Electric vehicles are limited as to how far they can travel and most jurisdictions have to cover many miles of roads, not to mention the cost of purchasing such buses.

Then there’s the BRFA.  HB152/SB192 is the annual Budget Reconciliation and Financing Act.  This is the “catch-all” to balance the budget. There are several problematic items in it this year.  It proposes to shift the cost of SDAT (State Dept of Assessments and Taxation) from 50% to 60% onto the locals.  It also reduces the Community College CADE formula and Counties would lose approximately $121 million in funding, which would either have to be added to the tuition or borne by the county taxpayers.  And if you remember the Highway User Revenue issue, this would also pull some of what little bit of local dollars we have left to pay for a State tunnel project in Baltimore City.

Speaking of Highway User Revenues, HB1394/SB982 would repeal the “sunset” provision that counties and towns advocated for a couple years ago.  Municipalities are nearly fully funded but Counties still have a long way to go.  We would like to make permanent the partial restoration we regained.  It also adds a gradual restoration of 1% and includes a CPI adjustment.  It is very important to have some type of bill on the table each year. Funding was cut 90% ten years ago and many legislators don’t remember how much this has harmed the towns and counties.  MACo definitely supports this bill!

A really bad bill, is HB1406, “Land Use Development – Middle Housing.”  This would completely preempt local land use control. The bill states that a local jurisdiction SHALL adopt land use regulations and amend its comprehensive plan.  Counties would be required to allow duplexes, triplex’s cottage clusters, townhomes and similar on single family lots in qualified census tracts. There are stipulations on what constitutes a qualified area, but this is definitely the proverbial “camel’s nose under the tent.”  It would only be a matter of time before most jurisdictions would have this requirement. MACo strongly opposes this bill.

Another bad land use bill is HB1390/SB741, “Public Convenience and Necessity – Electric Study and Procedures.”  This is another preemption bill that removes all semblance of land use planning regarding utility scale solar installations, requiring Public Service Commission approval.  Solar developers should not “freeze out” local jurisdictions, as this bill would certainly do. What is reasonable along a highway in suburban Montgomery County, may be completely unreasonable in a rural setting, with historic homes and landmarks on the Eastern Shore or Western Maryland.  There has already been litigation over this issue and will continue to be a fight. We strongly opposed this bill.

HB991, “Procurement – Transparency and Application to County Contracts” is another bill to eliminate local decision-making authority.  County procurement would have to be altered to match the State, which would make it much more complicated. Counties are transparent. We go out to competitive bid, get a minimum number of quotes, or piggy back off State contracts.  There is no reason to overturn our own procedures. MACo opposed.

A couple good bills that we did support were HB1485 and HB1496, “Maryland Medical Assistance – Emergency Service Transporters Reimbursement.”  Currently, Emergency Service providers are only reimbursed $100 per transport to a hospital. This would increase to $300, transports, not only to hospitals, but also urgent care centers.  It would also enable EMS to charge for the response, even if they don’t ultimately transport the patient to a medical facility. Our EMS units can sometimes bill insurance for these transports if a patient has insurance, but if there is no one to charge, it is a large expense to the counties.  This could be a big help to help offset the high costs of this very critical service.

Finally, we heard from one of our favorite guests, Budget Secretary, David Brinkley.  He gave us an update on the Governors budget and fiscal outlook. A record amount of $7.3 billion is being spent on Education.  Environmental programs are fully funded. $1.3 billion is being retained in the reserve account and Maryland is happy to report that it maintained its AAA bond rating.  General fund spending is growing at about 1%.  The Governors budget is balanced with no tax or fee increases or raiding of funds.  $75 million is in the pension funding, and the state has caught up and is ahead of its 80% funding goal.

Having served for three years on the Kirwan commission, Secretary Brinkley stated that the budget has competing interests and we live in a finite world.  Future deficits will occur and Kirwan will only add to them and a recession will only make it worse. To quote the Secretary “If everything is a priority then nothing is a priority,” which he pushed for during his time on the commission.  He believes we need to get the biggest bang for our buck and allow the locals the opportunity to prioritize their needs.

Secretary Brinkley said that the Kirwan commission was supposed to be a follow up to Thornton, from 18 years ago due to a court order.  To quote, “We’re about to repeat history” and pass policy with no funding source. “We are already spending 22% more per pupil and 28% more in teacher salaries than the national average.” Passing a budget is one of only two Constitutional obligations of the State. He agreed that the proposed sales tax increase will do nothing to fund the County share of Kirwan and the Governor opposes any tax increases to pay for Kirwan.  “The State must maintain its fiscal discipline and hardworking taxpayers live within their means and the State needs to do the same.”

So that’s the long wrap up of the past two weeks, all while the Kirwan discussions are going on, along with the Sales tax expansion that includes almost every service.  It’s a whirlwind of activity, but don’t stop keeping track.  Hold those legislators in Annapolis accountable to do what is in everyone’s best interests, and never just one group.  Until next week….

Laura Price is 2nd Vice President on the Executive Board of Directors of MACo, Chair of Budget and Tax, Talbot’s legislative liaison and member of the Talbot County Council.

Op-Ed: Report from Annapolis 2020 (Part 5) by Laura Price

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Well, the moment we’ve all been waiting for arrived a week ago. The Blueprint Education Bill, aka “Kirwan” has finally been introduced. Most of what I predicted last week came true. SB1000/HB1300 did follow the policy recommendations that were made by the commission. It did not change any wealth formulas. It did not change any funding formulas for the split between the State and the Counties. There was no timetable for a County phase in, as recommended by the Kirwan funding workgroup. It does allow for school expenses, that might be paid for in another county budget, such as school health nurses or resource officers to be included. Also, if the economy does take a downturn, it will allow funding to remain flat and not increase for that year. But the biggest problem is it absolutely does not identify any funding source for how to pay for it.

Finding a position that all the Counties could agree to did not prove to be as challenging as we might have thought. There are going to be proponents and opponents for what is in the policy of the bill. We may not agree on what tax rates should be and how it should be spent. But what MACo and all the counties approved was a statement that said the State should be paying for all of this new education expense.

This excerpt from the MACo statement explains why.“The State of Maryland should live up to its Constitutional obligation and stand behind its own ambitious recommendations and provide State resources to implement the full cost of the Kirwan Blueprint plan… the Maryland Constitution’s requirement of ‘thorough and efficient’ public schools properly places this duty onto the State…the Kirwan plan is a continuation of this State requirement.”

“Reliance on local funds for half, or more, of education funding merely promotes and extends the resource gaps that still plague Maryland’s schools…In the Kirwan Commission’s own research into ‘Fair Funding,’ the highest scoring state for equitable funding commits a much higher share of State funding than Maryland to achieve those goals…Taking into account current county funding commitments that have exceeded state standards, a plan that further increases reliance on mandated county funding can never accomplish the most equitable outcomes.”

Many reports have cited the leadership from Annapolis stating that they’ve pledged not to pass an across-the-board increase in the state’s income, sales or property taxes. Unfortunately, property and income tax are the only revenue sources a county has. It seems hypocritical that the State is not willing, nor do they think it appropriate to raise those taxes, yet the counties will be forced to raise exactly those taxes in order to pay for Kirwan, should MACo’s position not prevail (it won’t of course).

One of the goals of the Kirwan commission was to have more progressivity in the tax structure to provide better equity. Most will agree that property tax is one of the most regressive taxes out there. Even if you rent your home, you do pay property tax, because your landlord will absolutely be passing on this expense in your rent. More lower income people pay rent, so everyone pays and they pay at the same rate, no matter whether their house (owned or rented) is valued at $100,000 or $1,000,000. Ask most legislators in Annapolis and they will tell you it is a very regressive tax. So now, half of the cost of Kirwan, if it is to be borne by the counties, will have to be paid for by the second most regressive tax, property tax (next to the sales tax).

As I have written previously, 19 of 24 jurisdictions are either maxed out at 3.2% or above 3% in income tax, so that really only leaves property tax to pay for more than a $2.5 billion increase (Maintenance of Effort mandated increases + Kirwan). The percentage increases range from an average of 26% up to 76%. The statewide average property tax rate a county citizen pays is $1.19 per hundred of assessed value. For a $350,000 home, their bill is $4165. A 26% increase equals an additional 31 cents. That may not sound like much, but it adds another $1085 for a grand total of $5250.

Another big problem is the wealth formula, which only counts the assessable base plus net taxable income and divides it by the number of students in the system. It does not take into account any other factors in the jurisdiction, especially median household income. Many counties may appear “wealthy” by the States math, but when those counties have half of their kids on free and reduced meals (FARMS) and the median household income is far below the state average (Talbot’s is 20% below!), it proves the wealth formula is definitely NOT a one size fits all solution.

The ONE and ONLY public hearing is Monday, February 17th, beginning at 12:00 PM. It will be a joint committee hearing consisting of two Senate and two House committees, Appropriations; Ways & Means; Education, Health & Environmental Affairs; and Budget & Taxation. There are no plans for additional hearings, but ultimately it will be up to each committee chair to decide if future ones are needed.

Our legislative committee, still debated and took positions on 22 other important bills this week. No surprise but they were all overshadowed by Kirwan, the biggest and most expensive bill in Maryland history. It has had only 7 days of vetting and it is being fast tracked to a joint public hearing before people can truly understand its impact. Surely, this is a flawed legislative procedure and the citizens deserve better.

Laura Price is 2nd Vice President on the Executive Board of Directors of MACo, Chair of Budget and Tax, Talbot’s legislative liaison and member of the Talbot County Council.

Report from Annapolis 2020 – Part 4 by Laura Price

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We have gotten through the first 30 of 90 days in Annapolis legislative session. MACo reviewed three dozen bills which prompted wide-ranging discussion. The tax committee had our usual assortment of subtraction modification bills that MACo again sent letters to advocate issuing State tax credits instead.

There was a bill, HB565 – “Income Tax – Business and Economic Development Tax Credit Termination,” which is similar to HB223, “End Ineffective Business Subsidies Act,” that I previously wrote about and MACo opposed. Our economic development departments need these tools to attract and retain businesses that help create and add jobs to our economy. It seems the purpose behind some of these bills is to see how much money the State can claw back from the counties to pay for the Kirwan education bill. On the opposite end of the spectrum is HB492/SB493 – “Small Business Development Center Fund,” which MACo supports. This bill would increase the minimum appropriation from $950K to $1.5 million. This helps fund our local offices that work directly with our small businesses which are just getting started, helping them create business plans to become successful business in our communities.

From the education committee, HB665 – “Public School Construction and State Buildings – Use of Geothermal Energy,” was considered. This would prohibit the construction of a new public school unless it had geothermal installed. It would also require a State building to install a geothermal energy system. While there is an interest in more environmentally friendly buildings, this is not a technology that can be utilized everywhere. It might work well for the soils on the Eastern Shore, but would not be cost effective to drill down through rock in Allegany County. It also doesn’t make sense to rip out existing systems and do systemic upgrades. It would be problematic in a building that has a chiller. The decision to use geothermal should be made on a case-by-case basis, by the engineers and architects and by considering what actually makes the most sense and will be efficient.

A bill we did support, SB495 – “Bay Restoration Funds – Municipal Wastewater Facilities (Eckardt), would especially benefit the more rural counties. This would expand the authorized uses of the BRF to include costs associated with connecting a property to an existing municipal wastewater facility with enhanced nutrient removal. Here in Talbot, we have been particularly focused on getting people off of septic and onto a sewer line. If we can expand the use of funds to help offset some of the capital costs, we can really make progress on removing more nitrogen and phosphorous from reaching the Bay waters.

HB586 – “Public Safety – Criminal History Check – Fire Departments and Ambulance Services” would prohibit our public safety departments from conducting a criminal history check or requiring an applicant to disclose those records before an initial interview. This is an add-on to the “Ban the Box” bill that passed last year. The question asks whether the job applicant has a criminal history and is now prohibited on employment applications. We can debate if this is a good idea or not, however, when it comes to our emergency and public safety positions, it is vitally important that the employer know this information. These employees are our front-line defense, often going into individuals’ homes. It would also require these departments to establish a peer review committee and they would have some input in the hiring process. Our department heads should not have to abdicate any of their authority to decide who is the best candidate to employ.

SB388 – “Circuit Court Employees – Collective Bargaining” would establish collective bargaining rights to employees of the circuit and district courts. These are state-mandated positions that the counties have to fund completely. The local jurisdictions ought to be able to control the wages of our local employees without a State labor relations board also mandating how much a county must pay. This is another example of the State mandating the position and the pay, when the county taxpayers are footing the bill, hence MACo opposes this bill. We do like HB498 which would appropriate $1 million in the State budget to be used to make grants to area agencies to expand aging in place programs for seniors. It is so much more cost-effective than having our senior citizens have to go to nursing homes and have a much better quality of life if they can stay in their own familiar homes.

All that and the Kirwan bill had not been officially introduced as of this writing. By the time you read this, Education bill SB1000/HB1300 most likely will have been made available for all to read. (http://mgaleg.maryland.gov ) I’m sure by next week, this entire column will cover what is in the bill. Word is that it will follow pretty true to the actual recommendations that were made by the Kirwan commission and also maintain the funding formulas and the split between the State and the Counties.

My fear is that it still may not identify any actual funding source for how to pay for it. That would be almost exactly like “Thornton” from almost 20 years ago. Big policy ideas for improving education, but no specific way to pay for it. In reality, at least for the county share, it will require large tax increases, because we can’t possibly cut enough in current spending to be able to afford it.

The final report from November left some questions unanswered. Such as, what is the County timetable phase in? What will count toward the mandate (school nurses from health department, school resource offices in our law enforcement, for example)? Will there be any triggers to not increase for a time period, if there is a downturn in the economy? And will there be any changes to wealth formulas? For example, in Caroline county, One penny only raises about $250k, to fully fund Kirwan, they may have to come up with $10m, which would be an increase of 40 cents on their property tax rate. That is unaffordable for the citizens and there are many, if not most counties in similar situations.

Once again, stay tuned and stay informed.

Laura Price is 2nd Vice President on the Executive Board of Directors of MACo, Chair of Budget and Tax, Talbot’s legislative liaison and member of the Talbot County Council.

Op-Ed: Report from Annapolis 2020 – Part 3

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Week three is wrapped up in Annapolis and things are just really getting started. As Senate President Bill Ferguson noted that the rapidly-growing bill lists and committee workloads “kicks off the real first day of the 2020 session.” We reviewed twice as many bills as last week, 32 in all. There will be hundreds more to come! 

I believe we dodged a bullet on HB292/SB229 “Toll Roads, Highways, and Bridges, County Government Consent Required – Expansion.” This bill came up last year and was written to expand the authority to all 24 jurisdictions. It would prohibit the State from constructing a toll road without the consent of the majority of “affected” counties. This was interesting, because the original bill was written about 1978, soon after the completion of the second Bay Bridge. It was written to protect the nine Eastern Shore Counties. There is an AG letter of opinion that interprets “affected” to mean the county where the project lands. Well in 1978, there were only two toll roads in the State. The Harbor tunnel and the Chesapeake Bay bridge. To try to piggyback on an old bill and expand this to all 24 counties to a toll road, such as the I-270/495 corridor is inappropriate. A separate piece of legislation should be drafted and introduced and leave this existing law to stand alone. 

I attended the Senate committee hearing to listen to the testimony. Talbot, Queen Anne’s and Kent did not feel we needed to testify since MACo submitted technical amendments to leave us out instead of taking a position. This is especially important right now, since the NEPA study is ongoing and currently lists these three counties as potential “landing” counties for a third Bay Bridge span. Chairwoman Delores Kelly seemed to have several problems with the bill and there were tough questions asked at the hearing. I do not expect it will pass the Senate. There is still a House hearing in a couple weeks, but hopefully it will die and then a separate bill could be drafted for next year if appropriate. 

An update on HB223, “End Ineffective Business Subsidies Act” that MACo held open. I wrote in detail the problems last week. I am happy to report that MACo is officially opposing the bill. There is much opposition, but we will have to wait and see if it gets enough traction to pass. 

There are a couple bills related to taxing authority on both vaping and tobacco products. HB400 “Vaping Product Tax” would impose a 30% tax from the wholesaler to the distributor on vaping products and require the revenue be used for the State Reinsurance Program. It would also authorize a county to impose a local tax. This is noteworthy, because counties have never had the authority to have a local tax on cigarettes/tobacco in the past. SB3, “Electronic Smoking Devices, Other Tobacco Products and Cigarettes – Taxation and Regulation,” would also expand taxing authority to local governments. MACo supported both of these bills, although the local taxing pieces do not have much chance of passage. It would be helpful for locals to have more taxing authority, especially in the face of “Kirwan” – the massive mandated increase in education spending, otherwise we will be faced with huge increases in property and income taxes. (We are still awaiting introduction of the Kirwan bill) 

HB582/SB232 “Procurement – Prevailing Wage” would be an extremely harmful bill on local budgets. Typically, this affects us because prevailing wage must be used when a school construction project has more than 25% funded by the state and even that was lowered several years ago from a 

50% funding level. This bill would repeal that and apply prevailing wage to any project funding in whole or in part with State funds. Meaning if you take $1 from the state, you must pay the prevailing wage. To give an example of the increase in the cost of a project, I will use our new Easton elementary school as an example, even with current law. It is a $50 million project, if we had been able to use a normal wage, more appropriate to a rural Eastern Shore county (and not based on an inflated Montgomery or PG county wage rate), the project could have been about $10 million less. I can’t even imagine the cost increases if HB582 were to pass. 

There were more than a half dozen “subtraction modification” bills we opposed with our general statement this week. MACo believes that if the state wants to give a tax break to a person or group, that it should be done through a state tax credit and not through a “sub-mod” that reduces our income tax revenue. Again, especially in light of the education bill that will be forthcoming. Even worse for local budgets is HB411 “Homestead Property Tax Credit Calculation.” This is a repeat from 2019 that MACo strongly opposed again. I wrote last year “This would open up and require that any first- time homebuyer in the State of Maryland be transferred the existing tax savings of the previous owner. This might seem like a good incentive to make property taxes more affordable, but totally ignores and undermines the purpose of existing law. This tax credit was created so that as a home appreciates in value, as long as the homeowner lives in the home, the homeowner will not be priced out of retaining that home because of an increased assessment, which ensures stability in their future tax bills.” 

We heard an overview of the State budget from Vicki Gruber of DLS (Department of Legislative Services). Basically, the General Fund budget starts with -$579 million. The Governor submitted a budget with various transfers and revenue sources and the General Fund would end with a balance of $108.5 million if everything goes through successfully. More concerning is the structural deficit over the next 5 years. Ms. Gruber gave us two charts that showed the forecast both in an expanded growth scenario and with a fiscal slowdown. She also included projections including the cost of “Kirwan.” In the expanded growth scenario, the structural deficit is -$37 million in FY21, which grows to -$1.07 billion in FY25. When adding Kirwan costs, it grows to -$1.644 billion dollars. If our economy does slow down, the projections get worse. In FY21, the deficit is -$251 million. By FY25, the total structural deficit, including Kirwan is -$2.242 billion. These are staggering numbers. 

We also got updates from staff on ongoing issues. The big win we all cheered is on Small Cell (5G) legislation that was introduced last year. What is 5G? Let’s start with what is 3G, which means connecting your computer to the internet. 4G means connecting your smartphone to the internet. 5G means connecting everything to the internet. Estimates project that we will grow from 2 or 3 connected devices per person to 40-100 connected devices per person. There were two competing bills in 2019 and the Industry bill would have allowed them to deploy these refrigerator size cells anywhere with no local zoning oversight or appropriate fees. We beat the bill last year and there has been no bill introduced this year. We are the first state in the Union to have beaten the industry on this issue! That’s how powerful MACo can be and how important it is for us as local elected officials to stay engaged in what happens in Annapolis and to fight for what is in the best interests of our citizens. 

Laura Price is 2nd Vice President on the Executive Board of Directors of MACo, Chair of Budget and Tax, Talbot’s legislative liaison and member of the Talbot County Council. 

Senators Grill Reappointed UMMS Board Members About Scandal

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James C. DiPaula Jr., chair of the University of Maryland Medical System Board, addresses the Senate Executive Nominations Committee on Monday in Annapolis. DiPaula is up for reappointment to the panel. Photo by Danielle E. Gaines.

Senators had sharp questions Monday night for members of the beleaguered University of Maryland Medical System board seeking reappointment after a self-dealing scandal that led to the resignation of high-profile members and the federal indictment of former Baltimore Mayor Catherine E. Pugh.

Three members of the board ― including the current chair and vice-chair ― are seeking reappointment to the panel, which is nearly entirely overhauled after Pugh’s “Healthy Holly” dealings and other contracts with board members came to light last year.

The three renominated members pledged to the Senate Executive Nominations Committee on Monday night that they had no knowledge of the contracts with board members as they evolved and were committed to improving governance and transparency within the system.

“It was completely unknown to the board,” James C. DiPaula Jr., the board’s chairman, said in response to a question about the system’s $500,000 in contracts for copies of Pugh’s “Healthy Holly” children’s books.

Nine former members of the board had financial interests in companies doing business with the medical system.

DiPaula, who has been on the panel since 2017, said the system previously had written documents to address conflicts of interest, but they weren’t used in practice. They will be in the future, he said.

“We had written documents that said no board member was to be paid unless it was approved by the board. But management did not bring that to the board,” said DiPaula, who was nominated for reappointment by Gov. Lawrence J. Hogan Jr. (R) in December and has been serving as the board’s chair since June. “So it’s important not only to have the right governance instruments, but also to review them and to have continuous education for board members and senior management.”

Legislation passed in Annapolis last year subjected the medical system to tighter rules regarding financial deals and ended the terms of all board members, though they could apply for reappointment.

The Executive Nominations Committee on Monday asked no questions of a majority of the appointees, and minor questions of several others.

The most extensive questioning was reserved primarily for returning members of the board.

“We are far more vigilant now and we are certainly doing all that we can to cooperate with the state and all of the persons who are trying to make sure there’s a change of the culture,” said Alexander Williams Jr., a retired federal judge and former Prince George’s County state’s attorney, who is the board’s vice-chairman.

A member of the board since 2015, Williams told the Senate committee that he had no knowledge of the troubling contracts as deals were struck.

“I can give you unequivocal assurance that I was totally unaware of that activity. I read about it probably at the time you read about it in The Sun,” Williams said. “I can assure you that nothing like that will ever come back.”

Alan Butler, CEO of Erickson Living, another board member seeking reappointment, said he was “quite disappointed” when he learned about the contracts, which he called “wrong on all levels.”

Louis M. Pope, who is seeking senate confirmation as a returning representative from the University System of Maryland Board of Regents, told the committee that under his watch, such deals would never happen again.

“The incidents that happened … were basically backroom deals … that were done without the knowledge of other board members,” he said.

Pope faced other questions as well. Sen. Clarence K. Lam (D-Howard) questioned him about giving more than the state’s $6,000 contribution limit to Hogan during the last election cycle. According to a state database, Pope is listed as contributing $8,000 to Hogan’s campaign between December 2015 and September 2018.

Pope explained that he bought four pairs of $1,000 tickets to Hogan events over the years for himself and his wife. He told Lam that he’d reached out to the Hogan campaign to correctly identify that a portion of the donations should be made in his wife’s name.

One new appointee to the board, Kathleen A. Birrane, also faced tough questions.

Lam asked Birrane about a dozen postings on social media dating back to 2016 that questioned whether transgender individuals should be able to use the restroom of their gender identity and included anti-abortion messages.

Lam asked Birrane whether her personal views might conflict with Maryland’s anti-discrimination laws.

Birrane, an attorney, said she didn’t know which posts Lam was referring to, but that her personal views would never influence her work on the board.

“As a member of the Maryland bar, my personal views would never enter into any decision that I make either on behalf of any client or with respect to any appointment or any issue,” Birrane said.

The posts about transgender bathrooms included messages about empathy for people experiencing gender-identity issues, but focused on concerns from women sexual assault victims.

At the meeting, Birrane said she has very strong feelings about the transgender community, though not in the way Lam might expect.

“I respect the dignity of each and every human being, including those members of my family who may not always be seen in a very traditional way. And there would never be a circumstance in which I would personally tolerate any form of discrimination,” Birrane said.

Lam said the posts were troubling because they could interfere with official decisions. After the meeting, he said he wanted to further contemplate Birrane’s responses before pressing the issue with committee members.

“We have a responsibility to ensure that the values that we uphold and the provisions that are in statute to protect against discrimination are properly applied to a system like UMMS,” Lam said.

The committee also received a brief update on changes at UMMS from Aaron Rabinowitz, special counsel for governance at the medical system.

Rabinowitz noted that the board has adopted a new conflict of interest policy and that key positions ― including chairman of the board ― will no longer be held by anyone who has any financial interest in the system, including through family members.

Lam, who is also Senate chairman of the Joint Audit and Evaluation Committee, asked Rabinowitz about allegations that system officials had hindered a legislative audit originally due in December.

An October letter from Maryland Legislative Auditor Gregory Hook to legislative leaders alleged that UMMS officials had failed to make documents and employees sought by auditors available in a timely fashion.

Rabinowitz and DiPaula said Monday they disagreed with that characterization and that the system worked to supply all relevant information, but the process was complicated due to mass departures of the highest-ranking officials and decentralized records-keeping.

“There was no intent to delay or hinder or obstruct,” Rabinowitz said.

Since the letter, he said, system leaders have met with Hook and come to an agreement about how information will be provided.

By Danielle E. Gaines

Editor’s Note: This story has been updated to make clear that Louis M. Pope was nominated to the UMMS panel as a member of the Board of Regents.

Maryland Moves to Protect Lemonade Stands

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State legislators always want to support small business. But one bill introduced this session aims to help the smallest of businesses.

A bill introduced in the Maryland House would protect lemonade stands from local authorities who might want to enforce local permit laws that could shut them down.

The legislation coincides with a national movement led by Country Time Lemonade that has sought to introduce similar bills all over the country.

Besides support from “big lemonade,” groups that represent cities and counties in Maryland aren’t opposing it.

“This bill is certainly about the little guy,” said Delegate Neil Parrott, R-Washington. Parrott introduced the bill with co-sponsor Delegate Steve Johnson, D-Harford.

“When I saw (the national movement), I said we got to bring that to Maryland because what happened in Montgomery County was shameful and really hurtful to little kids,” Parrott said. “That’s not the message we want to send them.”

It is unclear how many counties in Maryland have tried to enforce laws that could ban the operation of lemonade stands, but the most prominent recent occurrence happened in Montgomery County. Congressional Country Club was the host of the 2011 U.S. Open golf tournament when county officials fined a half-dozen children $500 for operating a lemonade stand nearby.

In a joint interview with the Capital News Service Wednesday, the two lawmakers said the bill is needed to protect young entrepreneurs making their first attempts at operating in a market-based economy.

Parrott introduced the bill after seeing others that passed in Texas and Colorado in 2019 but said he didn’t know about the efforts by the Country Time Lemonade brand, owned by the Kraft Heinz Co., until more recently.

The company started its campaign in 2018 by paying off some lemonade stand fines “due to outdated permit laws” and has now grown its efforts into supporting laws like Parrott’s all over the country. It even operates a website that tracks states it says allow lemonade stands without permits — 16 by its count as of May.

“Whether you live in a red state or blue state, every state can be a yellow state,” the site says.

A company representative did not respond to a request for comment.

The fine in Montgomery County was rescinded the same day it was issued, but bill supporters want to make sure that doesn’t happen to their children.

“I think my children would be terrified if the local police department pulled up in our driveway and gave them a $500 ticket,” said Kelly Donohue, whose three daughters operate a lemonade stand in front of their Queen Anne’s County home two or three times each summer.

”They would probably never want to operate a business of that nature ever again.”

So far, it seems like the bill won’t encounter much opposition. Both the Maryland Association of Counties and the Maryland Municipal League have decided not to oppose the bill.

“I don’t think we have any Maryland counties who actively want to go out and enforce permits and inspections on kids running lemonade stands,” said Michael Sanderson, executive director of the Maryland Association of Counties. “The bill is written narrowly and we won’t have a problem with it.”

Even Montgomery County Executive Marc Elrich doesn’t have a problem with it.

Erlich, D, told Capital News Service he “wouldn’t mind” if the state kept him from shuttering lemonade stands.

“It’s hard to imagine what ingredients in lemonade could be deadly,” Ehrlich said, tongue-in-cheek. “Diabetics should know to stay away.”

The bill would prohibit any city or council from regulating the sale of any nonalcoholic beverage sold by anyone younger than 18.

It is expected to have its first hearing before the House Environment and Transportation Committee on Tuesday.

By Ryan E. Little

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