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November 22, 2024

Talbot Spy

Nonpartisan Education-based News for Talbot County Community

Op-Ed

Op-Ed: Kirwan Report – A County Perspective By Laura Price

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It has been an interesting and unsettling week since the introduction and subsequent public hearing on the Blueprint Education Bill (Kirwan).  The Maryland Association of Counties took a position that it is the State’s constitutional obligation to fund education and we believe that this new layer of funding should be borne by the State.  The counties have been equal partners and funded well above Maintenance of Effort, in addition to taking on teacher pensions and other expenses, while also losing revenues from the State over the years.

On Monday, there was a joint hearing of four committees in Annapolis, which I attended as a member of the Rural County elected officials’ panel.  To say the process was fair and all views were given equal opportunity to be heard would be inaccurate, at best.  

At the top of the hearing, Chairman Pinsky had announced, “We want to allow democracy and also have efficiency.  We have other work to be done. Obviously, this is a crucial piece of legislation for the legislature and the State… We are using a timer today, for the first 7 panels of elected officials, they will have 2 ½ minutes each…”  

The hearing began as most would, with the lead sponsors of the bill — Senate President Ferguson and House Speaker Jones — giving their statements.  They were followed by Brit Kirwan, the chairperson of the Commission, and Rachel Hise, from the Department of Legislative Services (DLS). They spoke to the merits of the bill and answered selected questions from committee members.  

Questions were limited and there were times the Senators and Delegates were cut off from their line of questioning.  When a delegate started to ask a question about funding, Sen. Paul Pinsky, chairman of the Senate Education, Health and Environmental Affairs Committee, stopped him and stated, “This is a policy legislation, it’s not the funding piece, obviously it has implications.  We’re going to hold the funding issue to when the appropriations, budget and tax and other committees address that issue.  We understand that this isn’t going to fall from the sky without a cost, but they’re (Kirwan and Hise) not prepared to answer budget questions, they are here with the policy…”

Really?  Not prepared?  That statement pretty much sums it all up.  No one wanted to hear about valid points of concern, let alone a negative position.  During the entire three years of the “Kirwan Commission,” we were all told they were not there to discuss how it would be paid for, only to make policy recommendations.  Wait until there is an actual bill in Annapolis, they told us, then we can talk about the fiscal impact. Now it’s the day of the hearing, the bill has been introduced and still the legislators, let alone the people, aren’t allowed to ask fiscal questions!

The main function all along for Ms. Hise from DLS was to put numbers to the policy.  She was the lead during all of the Kirwan funding workgroup and Kirwan commission meetings.  To say that she wasn’t there to answer financial questions is bizarre. Chairman Kirwan was there to advocate policy, and Ms. Hise, one would think, was there to answer funding questions.

After the initial bill sponsors and Kirwan and Hise had finished, the hearing continued with the county executives and the mayor of Baltimore.  They were each given their time and when they were done, I fully expected our panel of rural county elected officials to be called next. Imagine my surprise when that did not happen.

I thought it might have been an oversight and went in search of someone who had the list of people who had signed up to testify.  They finally located our panel, listed dead last on the list of 130 speakers.  He assured me he would reach out to Chairman Pinsky’s aide.  The aide explained that because we were listed as “letter of information,” we were at the bottom.  The testimony was all front loaded with Favorable or Favorable with amendments. I further asked if the chairman could consider moving us up because we were elected officials and that they had already heard from the larger counties.  The answer was no. A delegate even texted Del. Maggie McIntosh (chairwoman of the House Appropriations Committee) and the answer was still no.  

The four of us on the panel who were there weren’t even “opposing” the legislation, we were there to present information about the State’s constitutional obligation to fund education and the impact of tax increases at the local level under this mandate.

So, we sat for hours.  By the time the hearing was nearly five hours in, some of us gave up and left.  The media had left hours earlier. Many of the Senators and Delegates had left. The room was emptying fast and the elected officials from smaller jurisdictions, with huge impacts, had not been heard.  What was the point in speaking to a near empty room?

This is not democracy.  Allowing the larger jurisdictions to speak first and not allowing equal time for the other counties is discriminatory.  Having only select counties and other supporters fill the first couple hours paints a slanted view of any piece of legislation, let alone the single largest and most costly piece of legislation in Maryland history.

In other news, House Democrats just introduced a bill to cut the state sales tax rate by one penny and expand the tax to most professional services, including visits to the accountant or the beautician, which are currently exempt.  This significantly expands the scope of sales tax from just “goods” to include taxing most “services” with the exception of food, medicine, medical services, social work and other non-profits.

Delegate Luedtke said “There is a plethora of proposals for revenue this session, and we have a choice, we can do a whole ton of things at once, which are very complex and only pay for part of the plan, or we can have the courage to go to the people of Maryland and say, ‘If you want great schools this is how we pay for it and this one bill can do it, and it’s a relatively simple, straightforward proposal.’”  

People should and will debate whether this massive expansion of sales tax, which is expected to bring in $2.6 billion to the State by 2025 is a good idea, but I will say that at least someone in Annapolis finally realized that Kirwan could not be paid for without an increase in taxes on the average Marylander.  That has been my point since I started attending all the workgroup meetings and writing on this topic. If the State legislature does believe that Kirwan is a good idea, then they need to be willing to raise taxes on Marylanders to pay for it and be held accountable. The counties were always going have to increase taxes, primarily property tax, with no choice and very little voice if Kirwan becomes law.  

Laura Price serves as Talbot’s legislative liaison to the Maryland Association of Counties and is a member of the Talbot County Council.

The Spy Newspapers may periodically employ the assistance of artificial intelligence (AI) to enhance the clarity and accuracy of our content.

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.

The Spy Newspapers may periodically employ the assistance of artificial intelligence (AI) to enhance the clarity and accuracy of our content.

Report from Annapolis 2020 (Part Two) by Laura Price

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Spent another full day in Annapolis this week. In addition to our regular legislative committee meeting, some planned and some impromptu meetings took place in the Senate building prior to the meeting. Having facetime with legislators and lobbyists to talk policy in an informal setting is a positive way to strengthen relationships and have an impact. You never know who you are going to bump into in the hallways! 

During our meeting, the legislative committee discussed 15 bills. A few were similar to bills that MACo took a position on last week. The tax committee’s most impactful bill we discussed was HB223, “End Ineffective Business Subsidies Act of 2020.” This bill prohibits the Secretary of Commerce from designating or expanding certain Enterprise Zones and terminates the One Maryland tax credit. This is troublesome and shortsighted. Counties are trying to attract and retain businesses, and most of these tax incentives are an extremely helpful tool for our Economic Development departments to offer to businesses, who would otherwise be unable to expand or they might locate someplace else. These businesses create jobs and their employees then pay the taxes and live and work in our communities. Since, there is no hearing yet scheduled, the tax committee recommended holding this bill for further information and to see if the sponsor is willing to amend the bill before we take an official position. 

The land use committee bore the brunt of the bills this week. We supported HB78/SB172, “Bay Restoration Fund.” This authorizes and expands the use of funds to include climate resiliency and flood control. Any bill that expands our authority and flexibility is positive to be able to utilize our local autonomy for specific needs for the county. There were a few bills that didn’t have enough impact on the county to take official positions on, but could prove beneficial. One of them was HB177, “Water Infrastructure Assets – Authorization of Emergency Actions and Reserves.” This is a bill by the Maryland Department of the Environment (MDE) that establishes a reserve fund to take action against areas that are in imminent danger of failure, such as a dam or reservoir. The business owner of the property, would then be required to reimburse the department for monies spent. 

Another bill MACo is holding on is HB209, “Plastics and Packaging Reduction Act.” The bill hearing is not yet scheduled. This is the plastic bag ban and also establishes a 10-cent fee for durable paper bags. While not commenting on whether we agree with the policy, the concern is that it requires the counties to police it. There are no resources to do this. So, we are exploring an amendment to share a portion of the 10-cent fee, which currently the retailer would retain in its entirety, to help offset the requirement to enforce. Montgomery County is one of several counties that already have a similar bag fee. Their fee is shared between the retailer and the county. The county deposits its portion into the county’s Water Quality Protection Charge (WQPC) fund. 

Later in our meeting, we had a couple guest speakers from the administration to gain insight from them. This week we heard from the Secretary of MDE, Ben Grumbles and the Secretary of Planning, Rob McCord. Secretary Grumbles gave us an update on the lawsuit filed against the EPA for not holding Pennsylvania accountable for not doing their share of cleaning up the 

Chesapeake Bay. This has been a huge issue for years and the Clean Water Act requires the EPA to enforce it. PA is only at 74% of their goal and their funding is about $200-300 million short. So, we are using our tools under the federal clean water act and going to the courts for enforcement. 

Secretary McCord gave us an update on Census 2020. He stressed how important it is to get a complete and accurate count of our communities so that we receive all the funding that is necessary. One of the taglines his department is using is “Come to Your Senses” Census. Every household will be receiving their postcard on March 15th, with Census Day being April 1st. You can fill it out online or over the phone, before they send someone to your front door. An excellent resource is their website www.census.maryland.gov, where you can sign up to receive updates and get complete information. Know how very important this is for all people to be counted so please be prompt in filling out this information. 

After the official meeting, MACo hosted its annual reception for the Legislators and the Administration. This is always an excellent opportunity for the locally elected officials to have facetime to discuss the issues as well as our four MACo initiatives and why they are so important. We are able to meet Delegates and Senators from other jurisdictions that we normally would not have an opportunity to interact with. This is invaluable, because a smaller more rural area official can explain to a larger area representative, impacts and unintended consequences that a broad piece of legislation might have. This goes both ways and I believe all who attended gained a better understanding of the county issues. 

MACo and the entire State is still waiting on the official “Kirwan” bill, which will have an enormous impact on everyone. From a Baltimore Sun report “Democratic leaders of the state’s legislature have promised to fund an array of improvements to public schools — including expanded prekindergarten, increased teacher pay and other programs — without a broad-based tax increase. They’ve pledged not to pass an across-the-board increase in the state’s income, sales or property taxes.” I will reiterate from earlier articles I have written that income and property taxes are the ONLY taxes the county has control over, so if they have pledged not to have these tax increases, there is no ability of the counties to pay for their share of the cost. Many believe that if the State thinks these are all good ideas that will benefit our children, then the State should figure out a way to pay for the full share of the new Kirwan policy areas and not pass an unfunded mandate onto the counties who are strong partners and already fund 50% of the cost. 

Stay tuned, things are just starting to get interesting. 

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.

The Spy Newspapers may periodically employ the assistance of artificial intelligence (AI) to enhance the clarity and accuracy of our content.

Report from Annapolis 2020 (Part One) by Laura Price

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It is that time of year again, when the legislature in Annapolis is back in session.  This means that it is also time for counties to keep a watchful eye on legislation that is introduced and the effect it may have on our citizens.  I am your Talbot County liaison to MACo, the Maryland Association of Counties and the second Vice President of the association. I am serving my sixth year as representative on both the committee and the Board of Directors.  I have also been selected for the second time to chair the Budget and Tax Sub-committee.

The goal of Legislative Committee is to guide positions on bills and to advise each county’s representatives on relevant issues.  MACo’s staff provides insight into the effects of legislation on the counties. We, the elected officials serving as members set the positions to be advocated for in Annapolis, with each county receiving one vote.  This is critically important because the smaller, more rural jurisdictions have the same equal voice as one of the larger counties.

We watch for unfunded mandates and advocate to retain our local autonomy and decision-making authority.  When we gather each Wednesday, we leave our partisan hats at the door. We recognize that we have the same issues, no matter big or small, rural or urban, Republican or Democrat.  The members in the room understand and agree on what is beneficial or potentially harmful when evaluating pieces of legislation and taking a position.

The tax subcommittee approved two broad statements that will be submitted on many pieces of legislation, in lieu of needing to testify on each one.  The first, which is identical to our 2019 statement is “Tax Incentives and Local Government Autonomy.” There will be bills introduced that seek to do a subtraction modification.  Since the state would like to give a tax incentive, there is a way to accomplish this without harming the county. By applying a state tax credit instead, the state can give the incentive without it reducing our county income tax revenue.  This is similar to how property tax credits work and MACo members feel that State tax credits ought to work the same way.

The second statement is new this year.  “Equity with New Revenue Sources” is designed to advocate sharing any additional monies the State is looking to raise to support new education funding.  As most may know, there will be legislation introduced this year, based on the Kirwan education workgroup. I have written previously on this topic and more information will be coming when the legislation is introduced.  With a price tag of $6 billion annually by 2030 and the counties funding half of all education, we believe that any new revenue source should be shared with the locals to help pay the cost.

We used each of these statements on several of our tax bills this week and will continue to submit them going forward.  This also pairs with the first of our four MACo initiatives, “School Funding – Funding Fairness, County Role.”  

MACo has three additional initiatives for 2020.  “Strong Progress for School Construction” urges State policymakers to retain the State’s commitment to this top funding priority.  County governments share responsibility and fund over half of this cost and we need the State to keep up with their share, especially in light of modern cost factors for new environmental and energy standards and a heightened need for security.

“Next Steps in the Drug and Mental Health Crises” is our third initiative as substance use disorders and mental illness remain two of our most pressing health issues.  Our local health departments are often the first line of defense, but they have had to do more with less, since there were significant cuts made by the State. MACo is advocating for State partnership in support of innovative and gap-filling measures to improve accessibility and resources.

Finally, “Repeal Implied Preemption Court Doctrine.”  Maryland courts have assumed that counties are preempted from making some of their own local laws, even if the State law does not explicitly say so.  This will be MACo’s only stand-alone piece of legislation this year, which will state “Legislation should clarify, prospectively, that preemption should not take place in the courts, but in the open and accessible law-making process, where all stakeholders may be heard on the merits of their arguments.”

During week one, there were a few major bills reviewed and several smaller ones, but all are important to consider and sometimes that smaller bill might have a very large unintended consequence.  We considered 18 bills and took positions on all but four. We considered bills on a digital advertising tax and sports gaming and used our approved broad tax statements for those. We supported with amendments HB1, Built to Learn Act, as it pairs well with our MACo initiative.  We also supported bills on agricultural alcohol definitions similar to wineries and breweries, advancing Next Generation 9-1-1 (HB44/SB47), and Cyber Security (SB5).  

Looking forward, there will be no larger piece of legislation than the “Kirwan” education bill but at this point we are still waiting on it to be drafted.  It seems there will be changes to the actual Kirwan committee recommendations, but we don’t know at this time what they will be. I will write in more detail about that and all the other pieces of legislation we will consider as they get introduced.  But for this week, I wanted to give an overview of the process, and how important the county viewpoint can and must be, in influencing policy in Annapolis.  

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.

 

The Spy Newspapers may periodically employ the assistance of artificial intelligence (AI) to enhance the clarity and accuracy of our content.