Plan Would Curtail Mandated School Aid
O'Malley Outlines Deficit Solutions

By John Wagner
Washington Post Staff Writer
Friday, September 28, 2007

Gov. Martin O'Malley (D) indicated yesterday that he will propose spending $169 million less on public education next year than required under law as part of his solution to Maryland's looming $1.7 billion budget shortfall.

Under O'Malley's proposal, education spending would increase by $119 million next year and the state would start funding a much-delayed plan to send tens of millions of additional dollars to such jurisdictions as Montgomery and Prince George's counties, where the cost of providing education is more expensive.

But the result would be to curtail increases called for under the state's landmark Thornton plan, which has pumped nearly $1.5 billion in new money into Maryland schools since its passage in 2002.

Reaction from educators yesterday was mixed, with some expressing understanding of the state's fiscal situation and others less sympathetic.

O'Malley's plan was distributed during a public forum in Annapolis that he used to detail remaining pieces of his budget package and to urge lawmakers to adopt them in a November special session. Some leading lawmakers have said they would rather wait to act until their regular session in January.

"We need to act now," said Lt. Gov. Anthony G. Brown (D), who accompanied O'Malley to the forum, held in an elementary school gym. "We cannot wait until January to wrestle this to the ground."

To underscore the point, O'Malley aides noted projections showing that the state could gain more than $500 million in revenue by passing several tax increases advocated by O'Malley in November rather than waiting to do so in their annual 90-day session.

O'Malley has spent much of the past two weeks rolling out his proposals, which include an increase in the sales tax and an overhaul of income brackets that would require higher-end earners to pay more but provide modest tax breaks for most filers.

Among those critical of O'Malley's education proposal yesterday was Alvin Thornton, an educator who led the state commission that developed the plan, which is designed to ensure adequate funding for less-affluent school districts.

Thornton said he is "very sensitive" to the fiscal challenges faced by the governor and legislative leaders. But he said less money will possibly lead to a drop in student performance.

"It was never just money pulled out of the sky," he said. "It was connected to performance that could be purchased with the money."

Washington County Superintendent Elizabeth M. Morgan, who attended O'Malley's forum, said she thought the plan presented was "workable," given budget constraints. Morgan, who is also president of the Public School Superintendents Association of Maryland, said educators would like to discuss the plan further with O'Malley.

When O'Malley hinted at his plans during a radio interview three weeks ago, John E. Deasy, the Prince George's superintendent, said it sounded like something "you can deal with."

The state has budgeted nearly $5.2 billion for education aid to counties this year. That reflects several large increases in recent years, including $567 million this year proposed by O'Malley.

The law requires more modest spending increases, tied to an inflation-based formula, in coming years. Legislative analysts have expressed surprise in recent months at the size of the increase called for by the formula -- 5.2 percent -- which exceeds traditional inflation measures.

O'Malley said yesterday that lawmakers had no way of gauging what the impact would be when they included it in the law in 2002.

Under the governor's proposal, inflation-based increases would be suspended for two years and then capped at 2.5 percent in subsequent years.

During that period, however, O'Malley wants to start funding a geographic component of Thornton that has been considered discretionary under the 2002 law.

That part of the Thornton plan would allocate $129 million in additional funds to counties based on a formula that considers housing costs, the percentage of students receiving subsidized lunches, the rate of violent crime and commuting times. The formula would provide more money to such counties as Montgomery and Prince George's.

O'Malley did not include funding for the geographic component in this year's budget and unsuccessfully lobbied lawmakers to commit to it in following years. Under his proposal yesterday, it would take three years to phase in geographic formula, with $38 million being spent next year.

Staff writer Lisa Rein contributed to this report.