Higher Stakes for Legislative Session
Ehrlich, Assembly Face Election Year, Surplus

By Ann E. Marimow and Matthew Mosk
Washington Post Staff Writers
Thursday, January 5, 2006

Maryland legislators will descend on Annapolis next week for a General Assembly session sure to be steeped in election-year politics. The Democrats, who dominate both chambers, will try to pass their proposals while working to prevent the reelection of the state's first Republican governor in a generation.

For the first time since Robert L. Ehrlich Jr. was elected governor in 2002, he is working with a budget cushion of more than $1 billion. That surplus gives him flexibility to create a blueprint for fiscal 2007 that probably will include property tax relief and increased funding for popular projects such as school construction.

But budget analysts have warned that the windfall is only short-term and that the state's persistent gap between spending and revenue will return in the budget year that begins in July 2008. Ehrlich's budget secretary, Cecilia Januszkiewicz, has sought to temper expectations.

"There are a lot of people -- both inside and outside the government -- who believe we can fulfill everyone's wish. We can't," she said, stressing that the administration is taking a long view of the state's finances. "People will be unhappy because all of their wishes haven't come true."

Democrats plan to open the annual 90-day session with attempts to overturn Ehrlich's vetoes of several measures, including a bill to raise the minimum wage and another to effectively require Wal-Mart to contribute more to employee health care.

Democrats also are expected to try to force the governor to take a position on a controversial proposal for $23 million in state funds for stem cell research.

The issue that has dominated the past three legislative sessions -- slot machine gambling -- is likely to return this year. But House Speaker Michael E. Busch (D-Anne Arundel) has said he will continue to oppose a gambling expansion. He says he has yet to hear of a plan, other than the one that passed his chamber last year, which would have permitted 9,500 machines in four counties, that puts slots in places where House members want them.

When Ehrlich took office, Senate President Thomas V. Mike Miller Jr. (D-Calvert) told him they would have three years to work together. In the fourth year, an election year, Miller told Ehrlich, he would be on his own. Last week, Miller amended that pledge.

"I know the best politics for the people is good government and to continue trying to make government work for them," Miller said. "If Bob Ehrlich has a good bill, it will pass the Senate. I intend to continue to work with Republican leaders."

But, he said, that effort has to work both ways. He said he has not seen the same interest on the part of the Ehrlich administration.

"Basically, they're not communicating at all right now, for whatever reason," Miller said.

Spokeswoman Shareese DeLeaver said the governor met with Busch in November to discuss the session and would again "attempt to strike a collaborative and conciliatory tone, hopefully free from partisan posturing and politics."

As to the question of communication, she said, "The lack of communication didn't bother certain legislative leaders when it came to the politically charged special investigation."

Partisan tensions are expected to remain on full display in the early weeks of the session as the committee investigating Ehrlich's personnel practices pushes ahead. The panel has been meeting since the fall and recently began calling in witnesses -- including two former personnel managers -- to testify under oath about what they alleged were politically motivated dismissals ordered by top Ehrlich aides.

The lawyer hired to oversee the investigation, Ward Coe, predicted that there could be up to 20 more witnesses to come, possibly including Joseph Steffen, the former Ehrlich political operative who has acknowledged drawing up lists of workers to fire.

Steffen was fired in the hours before The Post reported that he had made claims on the Internet about orchestrating a whisper campaign against one of Ehrlich's political rivals, Baltimore Mayor Martin O'Malley (D).

Democrats have hinted that the hearings will produce legislation aimed at retooling protections for state workers. Under the law now, more than 6,000 employees, including many in non-policy-making roles, lack civil service protections and serve at the pleasure of the governor.

Republicans have questioned the value of the exercise, decrying it as a partisan witch hunt. Members of both parties are concerned that the hearings will shatter what is typically a period of calm during the session's early weeks while legislators seek to build support for their proposals.

"You're going to get the partisanship to an extent," said House Speaker Pro-Tem Adrienne A. Jones (D-Baltimore County), a co-chairman of the committee. "But I think both parties want to show they're doing something productive, not constantly bickering."

Another contentious topic that could surface early is when to hold primary elections. Prominent Democrats, led by U.S. Rep. Steny H. Hoyer, have been pressing to move up the primaries, which are scheduled for September.

Their concern: that a bruising Democratic primary campaign in the races for governor and U.S. Senate will leave the nominees weakened and cash-poor when they face Ehrlich and the likely Republican Senate nominee, Lt. Gov. Michael S. Steele.

Moving the primaries to June, though, will face stiff opposition from the governor and many rank-and-file members, who are worried that they won't have enough time to mount their campaigns because they will be tied up with legislative efforts in Annapolis until mid-April.

When the governor submits his budget to the legislature this month, the size of the surplus and pent-up demand for spending will enable him to propose funds for programs that constituents have been clamoring for during tough budget times.

"Whatever decisions the governor makes on how to spend the money will be second-guessed because it's an election year," said former senator Barbara A. Hoffman, a Democrat who led the Budget and Taxation Committee. "You can't really expect otherwise."

Ehrlich has said he wants to slice at least 1 cent from the state property tax rate of 13.2 cents for every $100 of assessed value. That would provide $40 in savings, for instance, for the owner of a home valued at $400,000.

Competing for a piece of the surplus will be the state's largest teachers union, which wants to enhance retirement benefits for educators and other state employees. Maryland teachers who retire after at least 30 years of service receive pensions of roughly 38 percent of their salary. The national average for teachers is about 57 percent.

Both major Democratic candidates for governor -- Montgomery County Executive Douglas M. Duncan and O'Malley -- support the union's effort but are wary of the $480 million annual price tag. It is uncertain whether Ehrlich will include a boost for pensions in his budget.

"It is the skunk at the wedding party," said former senator Robert R. Neall, a Republican turned Democrat who tried unsuccessfully for three years to shore up the state's pension system. "If they don't set aside a certain percent of the surplus as a down payment, fiscally the session will have to be rated a failure."

The confrontation over the governor's vetoes will pit business interests against those of labor unions. Last session, Ehrlich rejected a bill to increase the minimum wage by $1, to $6.15 an hour, because, he said, "employers have few options to recover the increased costs imposed by government."

The governor also sided with business in vetoing a bill that would require private employers with more than 10,000 employees to either dedicate at least 8 percent of their payroll for health benefits or contribute to Maryland's Medicaid program. Wal-Mart is the only company known to fit such a description.

The retailing giant has hired a team of lobbyists to try to block Democratic leaders from garnering the three-fifths support needed in both chambers to reverse the governor's veto. The measure passed last session with the Senate one vote ahead of the margin and the House one vote short.

Efforts to pass a statewide smoking ban again are facing resistance from the governor and Democratic leaders in the Senate. Still, advocates are planning an aggressive campaign armed with polling data and a series of successes on restrictions at the local level.

Supporters of spending state money on stem cell research also plan to renew their efforts. A bill stalled in the Senate last session under the threat of a filibuster.

The issue carries risk for Ehrlich. The governor needs to retain his conservative base and attract moderate voters in a state where Democratic registration outpaces GOP registration by nearly 2 to 1.

Ehrlich has said he supports stem cell research, but he was noncommittal on the measure. He is expected to provide funding for research facilities in his budget. But a proponent, Del. Samuel I. Rosenberg (D-Baltimore), said, "That doesn't do the job.

"If we want to keep our scientific edge," he said, "we need to fund the research itself and not just the building."