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Q: Next year, do you think you'll be able to add more than you added this year for College Park in both operating and capital [budgets]?
A: The capital definitely. The operating, we have to work with the legislature on and obviously work on both. But [with] capital, we have far more flexibility. Without getting into real detail, Maryland has something called [an] affordability spending limit, which is a very good idea that basically says spending can't go up faster than the growth in the family income.
There's a lot of other things in that, but it's family income. The net result is our revenues change faster than the affordability limit and so we are constrained to stay within affordability. The reason the revenues [rise] faster is you get capital gains and other things that are not in these calculations. And so last year, for example, the expenditure was limited to 4½ percent and we ended up with $380 million above and beyond the 4½ percent, which is where a lot of our capital money went. And the same thing will be true in this upcoming year.
We will have extraordinary flexibility for expansion of capital and I've already told numerous legislators, and they have concurred, that it's an opportunity for us to do one time construction projects on both campuses as well as school construction to move toward further reduction of class size.
Q: Governor, going back to [the] question about Sauerbrey's criticism, I think not to be her spokesperson but just to try to voice what her criticism was if you look at certainly two of the three big school systems in Maryland, Baltimore City and Prince George's County, I think most people familiar with those school systems parents, administrators, and the audit this week would agree that those school systems have deteriorated over the past number of years. And obviously you had less to do with Baltimore than Prince George's. But doesn't Sauerbrey have a point that you're spending all this money and yet the actual schools are getting worse?
And her point is that it's management giving more money to school and the Democrats have had a chance to try to do this and they haven't really, frankly, succeeded.
A: Well, first off, remember her basic thrust is in fact to take a significant amount of money from public education. I hope no one is caught up in this soft and fluffy rhetoric. And the reason I'm saying that, look at [her] votes in the past. Look at the constant votes against the budgets, against funding for education.
Look at the alternate budgets that she submitted both in the 1994 session and then subsequently when she proposed those huge tax cuts and there were cuts in education funding, and when you look at say cutting local aid, 85 percent of local aid is education aid, in addition to which the proposal that she has is for vouchers to take public education funding from public education into private education by way of the voucher system, which I oppose.
Now I'm stressing this, first of all, because it's unreasonable all of a sudden for someone to say, well, here we are in 1998 and I'm going to change everything that I've stood for in the last 20 years.
Secondly, on the management end, part of the reason we're having controversies around the state, not just in general, is because we are demanding greater accountability, we are in fact taking over part of the management of some of the school systems that's what Baltimore City was all about.
In Prince George's County, we have indicated that ... nine schools must be reconstituted, according to state guidelines. And you know, if they're not reconstituted, if we do not see a change in performance in those schools, the next step is the state will flat take 'em over which we do not want to do, because we believe education should be local.
But we are moving aggressively in these areas. We have also started everything from greater teacher-training programs and technology programs to help, as well as our "It's up to the student" program. And so, we have been aggressive, both in the funding level but also in terms of trying to improve the quality.
Now, some of the school systems have unique challenges, obviously they do, and this is true all across the country. But I believe the way to do it is to continue to invest and demand management improvements, not to abandon public education which is what her track record is.
Q: Governor, the yardstick that you use to determine how schools are doing [is] the MSPAP test and that was ultimately the yardstick that was used to determine that nine of the schools in Prince George's should be reconstituted, the same in Baltimore.
But, at the same time, the state has set a goal that some 70 percent of Maryland schools should be performing satisfactorily or better on this [MSPAP] by the year 2000. And it's pretty clear that's not going to happen ... And unless something really drastic turns around in the next year and a half, it seems that a lot of schools outside of Prince George's or Montgomery County are not succeeding at the level that the state has set for them. Is it inadequacy of the schools? Is it the test? The expectations?
A: Normally, when I used to prepare my tests at the University of Maryland, I would always have a (d) or (e) choice that says "all of the above" and to some extent, we might. I don't mean to be facetious about it, but I think to some extent it is look at all the above. It does involve additional resources.
For example, the reduction of class size I believe would be very important in certain areas. There are some questions about the tests that can be refined better ... And then the other issue is, we simply have to do better. All of us.
Parents. Teachers. Community. Funding agencies. We have to do better.
I think it is better to require our teachers and our children to reach for higher goals than it is to reduce the standards of those tests, or to say, well, we can't make it. And I want to try to continue to reach and to say what do we have to do to continue to improve quality and what do we have to do in continued financial support to reach those goals.
In fact, quite honestly, even if everyone achieved the goal I think we've still got to do more. I mean all we have to do is look at what is happening to the economy and to know that if our young people don't come out of this being really well educated, and an increasing number do not have the capability and opportunity to go to college. ... When you think what has happened in the last 10 years, and then think what's going to happen in the next 20 years, their future will be so limited, and therefore our future will be so limited. And so, yes, we have some challenges, but I want us to continue to push, I want us to keep raising that bar and have people continuing to struggle to get over that bar.
Q: Governor, along the lines of accountability, some would say that you're great on funding but weaker on policy issues, in particular in the accountability area? What do you think ought to be done to hold teachers accountable for their performance in schools? Do you support teacher performance evaluations? Teacher principal evaluations?
A: Well, first of all, I wouldn't agree with your assumption underlying the question. In fact, we have been recognized all over the country as a state as being out front and certainly one of the top three states in assessment and accountability efforts.
And when I say recognized, I'm talking about everything from the national business roundtable to U.S. Department of Education, the president, numerous other evaluations. To [former] governor Schaefer's credit and to Nancy Grazmik's credit, they started the program of assessment and accountability, it takes years to really get that whole thing working, and that's why we made a commitment to continue that process. I think what we do need to do is strengthen some of the tools in terms of teacher training and a variety of things like that.
That's one of the reasons, as you know, there's a debate going on right now about how we may improve teacher, preparation teacher education. I happen to believe that the effort we're undertaking, the K through 16 effort to require teachers to have far more functional training is appropriate. There are too many teachers teaching out of their field and there are too many teachers that are teaching math and all with not even a minor in math.
And nationwide this is true. And what we must do, and we're going through that process right now, of changing the teacher education programs, as you're probably aware, and the other thing is we've got to strengthen the teacher preparation overall, and that's one of the reasons we asked for and the legislature approved support for this teacher certification process, the master teachers effort, where the state would pay part of the cost for additional courses and the teachers would pay part of. So the bottom line is there are many, many good teachers out there doing a wonderful job but we must, I think, continue to improve the quality of the teachers as well as the schools.
Q: So do you support the idea of teacher evaluations?
A: I'd have to go through the details in terms of what it means. I'm just not prepared to, because I don't know all the details. Teacher evaluations means all kinds of different things to all kinds of people.
Do we want accountability and performance? Absolutely. And how do we get there.
Q: At the recent forum in Ocean City, afterwards you remarked that you were surprised that the candidates neither Ms. Sauerbrey or the other Democratic candidates have made a case for why ought to be fired. Essentially.
You said that they have not differentiated themselves substantially on policy matters. But one issue that they have talked about is your stewardship of Prince George's County and particularly on financial matters and [they] said that you didn't do a good job of managing the budget there.
Q: Can you expound a little bit.
A: We just happen to have an interesting article and a wonderful source, an impeachable source The Washington Post.
In this article, seriously, it makes clear what was happening during that time period. And let me just state two facts that absolutely cannot be contradicted. No. 1 is when I was campaigning I made it clear that we had left a $45 million surplus or reserve and I say surplus or reserve because we use both.
But we did. And that is there, it is in every report, every audit report, it is absolutely there. And it was there because there was a recession here, really bad, we had to make some tough decisions and we went back and we created a mandatory reserve at our request, my request, to be created by the charter and the voters approved a mandatory reserve account. And when I ran for office we had $45 million [in reserve].
Secondly, what happened was, that was fiscal '95, the following year the full impact of the recession hit the entire metropolitan area and here's an interesting story that talks about [how] it hit everywhere. It says there's an $80 million shortfall in Montgomery County.
Now I wasn't the county executive of Montgomery County. There was a $90 million shortfall in Fairfax County. I wasn't the county executive in Fairfax County. What happened, on each and every one of these, is you've got a situation where the impact of the recession on the property tax yield became very extreme throughout the entire metropolitan area.
And they had their $45 million reserve, that was clear, that was straight on through. Montgomery County had the shortfall and it's just a shortfall in terms in projections from following year expenditures.
Fairfax had it. And Prince George's County had it.
Now if everyone had that, that was a phenomenon of the economy in the entire area and particularly because what happens is, and I don't want to get real technical, but everyone I think who follows this issue understands this, and that is, the property tax goes on three year assessments. And the biggest dip in the property tax actually occurs in the second and third year.
And when you had that recession in 1991 and 1992, you were feeling the effects of it in 1995 and 1996. And now you tell me, if someone wants to criticize me on this, then how did it also happen the same number was in Montgomery County and the same number in Fairfax County?
Q: But Curry says this: He says that an audit right after that acknowledged some of these things, that the piggyback tax was going down from 60 to 58 [percent], in addition to that there were raises set to kick in the following year that were obviously take-backs that you took from union employees that were being given back in the first year of [Curry's] term.
And so, his contention is that you knew that while there was a $45 million reserve in one year, that you had obligated the county for expenses in the following year that you knew were going to obviously eat that up, and more.
A: As a practical matter, we said to the unions: In the depth of recession you give back voluntarily, no strikes, no job actions, no nothing like that. Unfortunately, we had to fire a number of people and I said you give back and we will kick this in. I forget when the give back was, two years later. And that's what we did and we voluntarily worked everything out.
So you can't really claim that, because the figures were the same for Montgomery and Fairfax County. The shortfall, the gap, was the same and it was the same elsewhere, it was nothing to do with my decisionmaking. See what I'm saying?
Q: Governor, can I just switch to the campaign a little bit? It's an issue which is coming up in the campaign: economic development. And you've been touting how well Maryland is doing ... but if you look just across the border in Virginia, ... most of the indicators suggest that Maryland's neighbor is doing better economically. And I'm wondering if you have any thoughts about why that is, and do you agree with some businessmen who say that Maryland's economic climate is just not as favorable?
A: Got all kinds of high tech firms flocking to Maryland and a lot of head to head battles. We're winning them straight out, where there's heavy industry, like the tough competition for the new Bethlehem Steel plant in which they decided to build a new $300 million plant in Maryland, in Baltimore at Sparrow Point.
Bechtel is another one, Bechtel Corporation. Tough competition where they wanted to [go], they were trying to lure them to Virginia. And so you go through all these, we're winning head to head on many of them. ... I keep hearing people say Virginia this, Virginia that. They may want to go run for the governor of Virginia, I'm running for governor or Maryland, and I am proud of what we're doing in Maryland.
Our economy, by almost every assessment, is the best it has been in well over a decade. Our unemployment rate is at a nine-year low. Our family income has now moved up to the fifth highest in the country. Our personal income is up to the third highest in the country, we're fifth in the country, according to Dunn & Bradstreet, in the creation of new businesses. We have created now 130,000 jobs. These are dramatic and significant statistics.
Now, someone says, well you know we can do more. We can do more. And I think you also have to raise some other questions. We've been pretty strong on some of our environmental rules. I intend to continue that. Some of the environmental waivers that I hear people talking about would be very destructive for the [Chesapeake] bay and for some other areas.
We've also got to pose I think a reasonable question: How much growth is reasonable in terms of what can be afforded on the infrastructure and the quality of life? I want to make sure that everyone is fully employed, I want to make sure that families and individuals have opportunities and clearly that's where we are. But you know growth just for the same of growth I think there's some limits to this and I think we've got to be reasonable in terms of what we're doing.
I would also add that when you think about where we are, we are investing clearly for the economy of the future. Clearly. I mean our efforts on education, on work force training, on high technology centers, these are jobs of the future and these are the ones we're winning more often than not.
So I would urge people to get off of, you know I get these different comparisons all the time and I was wondering if everyone's so excited what's happening elsewhere, why are they running for the governor of Maryland. I know someone you know took offense that my conduct was, they said well we can do a lot more, a lot more if we lowered taxes further.
We've reduced 10 percent income tax already and 15 other taxes for a $2.2 billion reduction over a five-year period. Well, if lower taxes are the only thing counted and I've said this before but if lower taxes are the only thing that counts then everybody would be moving to Mississippi. And it's not just about lower taxes.
It's about the quality of life, it's about investment in education and it's about some reasonable balance between a tax burden and expectation of services including education. And I'm very pleased what we're doing in Maryland is consistent with the commitments that I made and is consistent, I think, with where we should be in position in this state for the next century.
Q: Governor, in 1994 you bucked by a narrow margin the strong national tide of Republicans. What sort of national political environment do you think you'd be running [in this year] and will you be asking the president to campaign for you?
A: It's so nice that you recognize that we bucked that. The only reason I'm saying this is it's been interesting, everyone says, well you just won by 6,000 votes. In fact, [in 1994] there were only three new Democratic governors in the entire country. One was in Alaska, Tony Knowles who won by the way by 465 votes and every time he sees me, he calls me "landslide."
And the other was Hawaii, which up until that time almost automatically had voted Demcoratic. And I say this because beating that tide, as you just recognized, was a significant accomplishment, and it showed support for the basic programs that we have outlined and also showed opposition to the far right agenda, which is why I think you see her [Sauerbrey] trying to mask that today.
Now, interestingly enough, the climate has changed dramatically, and it is clearly an incumbents' mood because things are going well, we do not have that sense of anger and hostility out there.
And, in fact, if you look even on your own polls, that showed most people believe the state's headed in the right direction, as is the country, and we're in every corner of this state and that same tension and edge that was there four years ago is simply not there.
And most people are feeling very, very good about things and where they're going, and the real question has become more of how to do a little better, how do you grapple with some of these other issues.
There's still dissatisaction, correctly so, on the crime issue. Crime is down, violent crime is down, but we still have a long way to go. There's concern about some of the environmental issues including the bay and I think again correctly so, and there's concern about the quality of education, but that bitterness is not there.
With the last part of the question, will we ask the president to come in? Yes. And the vice president, as you know, has already hosted a fund-raiser for us. They're being helpful across the board. I was at the White House yesterday on some transportation issues but I also got a chance to talk with some of them there. The president will be coming in and hosting an event for us as well and will be doing whatever else we need.
Q: You mentioned our poll. Yes, people were pleased with the state of things. They also were not very excited about you ... Do you think that was wrong? Unfair?
A: I think there's still maybe a mixed reaction to us. Part of it is, as I've said publicly elsewhere, we've made some mistakes. I shouldn't say we in this case, I'll be more specific, I have made some mistakes. I know that.
In addition to which we've made some controversial decisions that had to be made, and when you go to the [Eastern] Shore, for example, they're so happy about a number of things but there's still some concern about our struggle against pfiesteria and what will happen there. So you go through some of these things and you can't leave without making some controversial decisions.
But it is also clear, now that the focus is coming down to where we are versus where our Republican opponent in November is that that support is firing up considerably and in fact I think most of you probably saw Ray Schoenke's poll, which led him to not only leave but to support us. And it was clear that it was firming up considerably, because of the choices there were ... Look at the gun violence issue.
Now, all of a sudden I'm seeing these soft statements that say, well she wouldn't repeal the gun laws that we have in place. As a practical matter, however, for 16 years she voted against every single effort. She made a major, major focal point of it the last election and after the election was over, the NRA put $25,000 up to help unseat the outcome of that election. And there's no doubt in my mind that we have a fundamental difference here.
I happen to believe that you can save lives by having a responsible gun control policy, and we fought for that and we got a bill through that no one thought was going to go through and it's still the strongest in the country. And there's big differences.
So what you can say is, well, gee, he may not have that charming personality of [the late comptroller] Louis Goldstein, but when you really get down to the choices I believe that support is going to be very, very strong and that's what the polls are now showing. We're not just relying on the polls, because we're relying on trying to do the right thing and articulate where we are and where we want to be in the next four years, as well.
The funny line of this campaign so far was, I had dinner with Ray Schoenke the Saturday before he withdrew, and after some niceties and all we said, well Ray, I know why we're here, let's have a little discussion. And so he said, well, he said, I had a meeting with my pollster and he said he indicated that I'd spent $2 million and the governor went up almost 15 points [in the poll]. And he said what should we do now? And so they recommended spending about $2½ million, and Ray looks at me and he said, "Heck, if I'd done that, you'd win by a landslide."
I think we're going to do very well, because of the fundamental issues, and she knows it, and that's why she's backing away from her strong statements and votes over and over on issues of choice. That's why she's backing away from issues on gun violence.
Q: This is Ellen Sauebrey?
A: It's like the old rule of not mentioning the names ... I find it interesting, she's trying to moderate these issues, but it's just not believable. I mean the NRA, once they get their claws into you, they're in there and they came in and if I remember correctly on Dec. 19 put $25,000 into the challenge to try to get her to have that election overturned. And they didn't all of a sudden go away just because she said, well, I'm not going to do anything against this and all. I mean we've got a challenger that's trying to mask [herself], but that's exactly what this campaign is going to be all about.
Q: Governor, you said a minute ago that you conceded that you had made some mistakes. Could you identify those for us?
A: You've done a pretty good job of it.
Q: I'd like to hear it from you.
A: I think the handling of the Prince George's County pension was incorrect and I've said that the pension system itself was not unreasonable for employees. I should not have taken, nor should some others, the early out on that pension and I understand that probably had I have really had time to focus and think about that, would have made a different decision at the time.
I didn't. I was coming off the election going right into the challenge of everything, and it was my decision. I'm not denying that, someone clearly said sign these forms and this is what happens and all, and we did it, but that was wrong.
And probably the handling of a few other things, especially early on, was incorrect. But part of the process is you learn. And we've learned and we've learned how to work closer at the legislature, the last two sessions have been extraordinary in what we've gotten through. We've also learned how to deal with interesting parts of the political landscale, former governors and things like that, and you know that's what part of this is all about.
It's a learning process as well. And I just feel so extraordinarily comfortable we got our agenda through. We got it through the way we said we were going to and these last two years were extraordinary. I don't know if some of you have seen what they're saying all across the country, for example, about our smart groove or the fact that we triggered both at the national and state level renewed emphasis on water quality as a result of making it clear what was happening with Pfisteria and things like this.
I also happen to believe very strongly in an inclusive, aggressively outreaching and inclusive government and we have made dramatic changes in history in so many ways in doing that. And so I'm pleased with what we've done, got off to a rocky start but quite obviously not just I and Kathleen but the state is doing very, very well.
Q: Governor, Ellen Sauerbrey says that taxes, specifically income taxes, can be cut more. Are you saying that the state is where it should be in terms of after the 10 percent goes through in terms of taxes or would you like to see further income tax reduction?
A: I'm saying now, as I did last time and as I did throughout the four years, that all of this comes down to a matter of setting priorities and being responsible and balanced. By that I mean it would have been irresponsible to come in, especially in those first two years, and cut taxes and cause huge cuts in services or education or whatever is appropriate.
And we resisted that until the economy got much, much better and that's why, we made some business tax cuts to make us more competitive but that's why the income tax cut went through this last year and went through, I believe, in a moderate and responsible way. I think our obligation in the future is first to make sure that we are meeting very important crucial needs for the state and needs both in terms of positioning us for the future, including most poignantly education K through 12 and higher education, as well as important human needs.
Now I may be one of the last, I'll use the word progressive, progressives left on this earth but I happen to believe that there are still a huge number of needs out there that we can offer help that do involve resources.
Just as an example, in this last session, I was very pleased that we were able to get our children's health program through. That of course took about $30 million of state money to match the federal. I was very pleased that we got a program to eliminate the disabilities waiting list for the adult children with disabilities like Downs Syndrome and so on, that is a $75 million cost total. I was very pleased that we were able to do some significant expansion of education funding, particularly targeted for at risk children.
Now these are important, important considerations. I think in some ways perhaps it would have been easier to say oh let's go for a bigger tax cut and look at how people will be politically receptive to that. First of all, I'm not sure they are.
I think people understand what these needs are all about, but secondly I think we need a responsible government but we also need a compassionate government. And if we can afford to help people from off of the disabilities list or we can afford to help cover children in working families who don't have health coverage, then I think we ought to do it.
And so I will do in the next four years, voters willing, what I did in the last four, and that is I'll weight the relative merit and I can tell you straight out my No. 1 priority is going to be to continue to focus on the progress of education and that will take some additional resources, and I think by hanging tough on that issue the state of Maryland collectively and Marylanders individually will be far, far better off at the end of that four year period as we go into the next century than simply by slashing some additional revenue sources.
Now I know it was a long way to get around it but it's not as simple as saying I'd cut taxes more.
Did you see the explanation in the Baltimore Business Journal about how she was going to pay for those additional cuts? Do you have that with you?
Well she was asked. Baltimore Business Sunday Journal, we'll get this to you. We'll get this. It's beautiful. She said yes, I'll cut income tax more. They said well how would you pay for it? Would you cut people? She said no.
And they said well would you cut programs? And she said no, because this is the new fluffy moderate position. And they said well how would you pay for it? And she said, well you know-and I'm telling you it's the honest truth, I'm going to fax it over to you this afternoon-she said in Texas, for example, they found that they could save a lot of money on their faxex by putting stick 'ems on instead of covering that extra sheet, and if you take your faxes and use stick 'ems instead of the cover sheet you can save considerable money and be able to cut taxes. Now I'm telling you, that's what the explanation was.
Now I'm trying, the reason I went into a longer explanation, I'm trying to be reasonable and balanced and reasonable and balanced says to me we take care of our real priorities first, which is education. And, secondly, I'm in this position not for the fun of it but I'm in this position because I care that we do have responsibility and compassion. And I'm going to fund those programs first.
Q: "Fluffy moderate," is this going to facotor in to any of of your advertising?
A; Have you seen that ad?
Q: Seriously, is that going to be part of your campaign? A: Well I think it is important, we're going to do a positive campaign as we always do but I also think it's important, I think it's important that the voters understand that choices that are before us.
I'm for a woman's right to choose. She has not been, ever in all the and that's going to change. I am for tight restrictions on all the guns in our community that are causing these problems of violence. She is consistently against it. I have stood up on the environment and said this is what we've got to do. She's opposed our Smart Growth, she opposed our pfiesteria program, she opposes everything we do.
I believe part of the transportation solution is a more rational and expansive mass transit system, she has absolutely opposed that and when you go down I'm for public education, she's for a voucher system to move funds there.
I believe that we ought to help people go to college. She says this is a waste. And the children's health program she says is an entitlement program. I happen to believe that our children are entitled to health coverage. Now what you have here is a progressive and responsible agenda versus a far right agenda and I think the public has a right to know that and when they know that I'm confident of the outcome in a very positive way.
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