One of the biggest showdowns was left unresolved when lawmakers adjourned Monday night with a raft of unfinished business. A proposal to shift a share of teacher pension costs to the counties looked set to pass, but the measure — together with a package of tax increases and a proposed casino — collapsed minutes before the midnight deadline.
If legislators cannot resolve the outstanding issues before July 1, funding cuts totaling $500 million would be imposed by a so-called doomsday budget passed by the General Assembly. But legislative leaders say they expect Gov. Martin O’Malley (D) to summon the General Assembly for a special session before the current fiscal year ends June 30.
House and Senate leaders would then probably try to pick up where they left off on teacher pensions, with a deal to shift half of ongoing cost to counties over four years. The plan would eventually add roughly $200 million in expenses to counties, but with offsets in grant funding and higher local tax revenue, which would blunt the vast majority of the expense. Next year, the combined impact to county budgets would have been about $5 million.
However it plays out, county budgets will see added expenses. “We’re not exactly taking a victory lap,” said Michael Sanderson, MACo’s executive director.
Montgomery County Council President Roger Berliner (D-Potomac-Bethesda) said some in his county see the “doomsday budget” as preferable to a deal that includes the pension shift and a tax hike on high-income earners.
But in Prince George’s County, the impact of the doomsday budget would be far worse than the pension shift, said Thomas Himler, a top budget official for the county.
But both county officials share the view that the window for negotiation on the pension shift appears closed. “Our views on this issue do not appear to matter to the powers that be,” Berliner said. “We don’t see the prospects as fundamentally changing in the special session.”
Counties failed to stop the shift, though they succeeded in altering the plan to have it occur in stages.“We were able to make it an easier pill to swallow,” said Ingrid Turner (D-Bowie), a Prince George’s County Council member and MACo’s president.
MACo — pronounced “may-co” — holds one of the best track records in Annapolis for killing proposals it dislikes and greasing the wheels to pass legislation it wants. But the group of county officials has been reluctant to claim successes this year, after what Turner called “one of the most difficult General Assembly sessions for counties.”
Again and again, county leaders were presented with what they saw as attacks on local autonomy.
At a budget hearing last month, officials from Montgomery and other counties sat in the audience stunned, they said later, by a new mechanism for locking in education spending.
The plan unveiled that day called for the state to seize county tax revenue and hand it directly to school boards if the county fails to meet “maintenance of effort,” a state mandate requiring local governments to keep school funding at least constant.
MACo said that would amount to “a complete state takeover of county budget decision-making.”
On Tuesday, O’Malley signed the school finance bill into law.
On O’Malley’s bid to curb residential sprawl by limiting septic system use, MACo fought the state to a compromise that has pleased almost no one.
The group strongly opposed an attempt by O’Malley to curb septic use by inserting the state into local land-use decisions. But it dropped its opposition when the bill was watered down significantly, leaving ultimate land-use authority with counties.
Donald F. Norris, chairman of the public policy department at the University of Maryland Baltimore County, said that although O’Malley had to accept a weaker bill, the legislature will probably try to strengthen the law in future years to increase the state’s power over land use. The bill’s passage, Norris said, “is really the camel’s nose inside the tent.”
But Turner said she believes MACo scored a victory this session in preventing O’Malley’s PlanMaryland — a statewide effort to tie together Maryland’s patchwork of smart-growth strategies — from translating into new restrictions on development. When the administration launched the plan last year, she said, it “was teed up to be a disagreement between the counties and the state.”
MACo lost its fight over another environmental bill, which will force eight large counties and Baltimore to levy a fee on property owners to fund storm-water pollution control projects. The bill originally proposed a statewide mandate. Leslie Knapp, MACo’s associate director, said the group “could live with” the scaled-back version that passed, and Baltimore supported the bill.
MACo also fought a bill to raise the dropout age — which it said would mandate new county spending — and a bill to force counties to require sprinkler systems in new houses — which it said would increase rural home prices. Both bills passed.
“On the whole, it was not a good session for MACo,” Norris said.
The move to shift pension costs to counties was significant but not surprising, given the Maryland’s fiscal situation and the reality that states have been shifting more costs to localities, Norris said.
A joint legislative committee pressed O’Malley this year to cut the state’s billion-dollar structural deficit in half, and the pension shift was a key element in that effort.
“I’ve resisted very strongly any efforts to simply shove the problems down to the local government,” O’Malley said in an interview. “We’re all in this together. These have not been easy years for anyone.”
O’Malley also said the session “would have been better” for MACo had it gotten behind his unsuccessful push for an increase in the gasoline tax to fund transportation projects. “They were kind of schizophrenic on that,” he said, with counties such as Montgomery and Prince George’s in support and others “governed by tea party Republicans pretending that there’s not a problem.”
The group’s membership includes all 23 Maryland counties and Baltimore, and part of its power derives from having state lawmakers from its liberal urban areas and rural conservative ones seek to do its bidding in Annapolis. O’Malley was a MACo member while mayor of Baltimore.
Norris said this session’s setbacks don’t necessarily spell trouble for the group, which has long been among the most effective lobbying voices in Annapolis.
“I don’t think, down the road, it’s going to harm MACo’s ability to advance the interests of county government,” he said. “It’s just a lesson that they can’t always win.”
Staff writer Aaron C. Davis contributed to this report.