Big Surplus Comes at a Good Time for Duncan
Montgomery County Executive Can Afford to Be Very Generous While Running for Governor

By Tim Craig
Washington Post Staff Writer
Wednesday, March 15, 2006

Montgomery County's coffers are overflowing with a surplus of at least $300 million. And in a year in which he is running for governor, County Executive Douglas M. Duncan is spending it on schools, police and fire protection and an array of other services.

Duncan won't formally unveil his $3.9 billion budget proposal for the coming fiscal year until today. But he has devoted much of the past month to rolling out more than $100 million in new programs, with reducing traffic and promoting public transportation high on his list.

Duncan's supporters say spending on important public services has always been a priority. But this year, he has taken extra care to highlight that spending in scripted events designed for maximum media exposure. The events are meant to distinguish Duncan from his rivals in the race for governor -- Baltimore Mayor Martin O'Malley (D) and Gov. Robert L. Ehrlich Jr. (R) -- and have often taken on a political tone.

This week, Duncan was surrounded by charts, books, students and elected officials when he appeared at Bethesda Elementary School to say he would boost school funding by 7.8 percent. Last week, against a backdrop of police officers, firefighters, sheriff deputies, a police dog and flashing police lights, he proposed adding nearly 200 public safety positions.

Montgomery's wealth has given Duncan -- who trails O'Malley, his opponent for the Democratic nomination, in polls, fundraising and name recognition -- a platform to criticize O'Malley's record on crime and education.

"I got a record on investing in education and have results to show for it," Duncan said in response to a reporter's question this week. "He has a record of investing in crime fighting and doesn't have a record to show for it."

While Duncan and Ehrlich are using next year's sunny financial outlook to highlight election year priorities, O'Malley remains hamstrung by Baltimore's tax base, which is just starting to stabilize after years of decline.

"We have made incredible progress in Baltimore on tough challenges and limited resources," said Rick Abbruzzese, spokesman for the O'Malley campaign, noting that the city implemented full-day kindergarten in all schools before Montgomery did. "The challenges we face here are clearly different than those the people of Montgomery face. . . . It is sad Doug Duncan doesn't realize that."

In Montgomery, the biggest challenge this year appears to be how to divvy up the money.

Duncan has agreed to fully fund the school system's $1.8 billion operating budget and its six-year, $1.2 billion capital budget. Duncan also has proposed double-digit increases for public safety and transportation programs, and he wants to double the amount spent on Montgomery Cares, which helps uninsured residents pay for health care.

Duncan also plans to propose a cut in the property tax rate of 9 1/2 cents next year, and for the first time in four years, the county executive has stuck to a voter-imposed limit on property tax revenue.

The rate cut would provide about $400 a year in relief to the owner of a $400,000 home. If the cut is approved by the council, Montgomery will have one of the lowest property tax rates in the state, behind only Talbot and Worchester counties.

But even with the rate cut, many -- if not most -- residents would have higher tax bills because of rising property assessments.

Duncan also has proposed freezing tuition at Montgomery College -- while pointing to tuition increases at Maryland public colleges and universities since Ehrlich took office.

On the issue of conservation, Duncan criticizes Ehrlich administration policies and says he will propose a $14 million increase in spending on Montgomery's land-preservation programs.

Some County Council members wonder whether the bill for Duncan's spending proposals will come due soon.

"It's like a candy store," said Marilyn Praisner (D-Eastern County), one of three council members who have remained neutral and not endorsed Duncan in his campaign for governor. "I worry about sustainability."

Since Duncan took office in 1994, the county budget has more than doubled, while the county's population has grown by about 20 percent. County officials said Montgomery's budget is larger than those of four states: North Dakota, South Dakota, Vermont and Wyoming.

Duncan supporters note that he took office as the county's population was rapidly changing because of an influx of immigrants, many of whom require more services.

If the council approves Duncan's fiscal 2007 budget, the school system's budget will have increased by 120 percent since Duncan took office in 1994.

Other areas of county government have experienced similar growth. Spending on public safety and transportation will have more than doubled from 1995 to 2007 if the council approves Duncan's spending plan.

The county also has spent more than $100 million to revitalize Silver Spring and tens of millions to build and maintain the Music Center at Strathmore, a 1,976-seat concert hall in North Bethesda. Spending on the arts has increased 411 percent during the past two years, according to council analysts.

Duncan supporters praise his spending.

"This is a great place to live. Our property values are way up, and people want to live in Montgomery County," said council President George L. Leventhal (D-At Large). "Surely, Doug Duncan deserves some of the credit."

But critics call his spending profligate and insist that his decisions will haunt taxpayers in the years to come.

"What they get, they spend," said Marvin Weinman, president of the Montgomery County Taxpayers League.

This week, Duncan said he has no intention of lowering the county's 3.2 percent income tax rate, the highest rate allowed under state law. The county's taxes on cell phones and energy use also are likely to remain the same, Duncan said.

Personnel costs eat up about 80 percent of the county budget. Since Duncan took office, the county's workforce has grown by a third, according to council analysts. And some say Duncan has been too quick to negotiate costly labor contracts with unions to win their support for his campaign.

"Bargaining needs to be a two-way street, and I have not seen a two-way street," said council member Phil Andrews (D-Gaithersburg), a frequent Duncan critic.