The Prince George’s County Council on Thursday rejected County Executive Rushern L. Baker III’s pleas for a major tax increase to generate more education funding but passed a budget that would require a modest tax hike and end a property tax cap that’s been in place since 1978.
Council members refused to consider either Baker’s original proposal for a 15 percent increase that would have produced $133 million a year for schools or a last-minute compromise offer that would have generated $65 million in new funding.
Instead, the council voted 6 to 3 in favor of a budget that would raise the property tax rate by 4 percent, generating $34 million in new money for schools.
The budget includes several other small revenue increases, including a hike in the telecommunications tax and permitting fees. But it rejects layoffs and furloughs proposed by Baker (D), redirecting $5 million from other funds to offset a revenue shortfall.
Most of the new school money would go to teacher pension costs that used to be covered by the state, said Mel Franklin (D-Upper Marlboro), the council chairman. That means programs to improve student achievement that were touted by Baker and schools chief Kevin Maxwell will not be funded.
“While we support many of the concepts in this school system’s strategic plan, we have collectively determined that [Baker’s proposals] . . . are not affordable for county taxpayers,” Franklin said.
Baker, who took control of the struggling school system two years ago, has made boosting achievement a top priority. He declared Wednesday that any funding increase of less than $65 million would be “unacceptable” but refused to say whether he would veto parts of the budget if the council did not meet that threshold.
In a statement after the vote, Baker said he would review the budget in coming days and decide “whether it represents the best course to position us for a more prosperous future.”
The county executive says a more money is needed to make Prince George’s schools as high-performing as those in Montgomery and Howard counties and to draw residents, businesses and wealth comparable to what exists in those jurisdictions. His proposal drew praise from the Prince George’s Chamber of Commerce, some parent groups and U.S. Education Secretary Arne Duncan.
But the plan caused an outcry in much of the county, whose residents already pay higher taxes than their neighbors and many other jurisdictions in the state. Some pointed out that Prince George’s is still recovering from the recession and a foreclosure crisis that decimated the household wealth of many. Others questioned whether the school system, long plagued by poor performance and poor management, would use new resources wisely.
“We are extremely disappointed,” Maxwell, the schools chief, said in a statement. “This council action continues the tradition of chronic underfunding for our schools. Moreover, it sends a message to our children and all Prince Georgians that an investment in education is not a top priority.”
Council members said they could not ignore what Mary A. Lehman (D-Laurel) described as “record-level” feedback from residents.
“I have expressed concerns of transparency . . . and those have not been satisfied,” said Lehman, who called her vote against the version of the budget that was passed by the council the most difficult of her political career. “The public needs to understand this is a gut-check.”
Franklin said the council wants to audit school performance and improve accountability before authorizing dramatic increases in funding.
The budget approved by the council would mean the end of TRIM, or Tax Reform Initiative by Marylanders, the tax cap set by voters decades ago that kept the residential tax rate at 96 cents per $100 of assessed value. Officials are relying on a 2012 state law that says county governments can raise taxes above charter limits if the additional money goes directly to public education.
“The state legislature and county have just trounced the voting rights of a primarily African American community,” said Judy Robinson, a tax-cap activist who is white. “I didn’t think they would have the guts to do it. They have disrespected us.”
The property tax rate would rise to $1 for every $100 of assessed value — compared with 73 cents per $100 of assessed value in Montgomery, which has a different cap in place.
Overall, the council trimmed Baker’s budget by 2.5 percent, to $3.54 billion. Baker has until about the middle of June to send the budget back to the council. He can reject specific items or the entire package but cannot, unilaterally, set any tax increase above the council-designated limit. It would take six votes for the council to override a veto.
Franklin said even the 4 percent tax increase will anger many residents, but he added that council members believe it reflect the “fiscal reality of the county.”
He said the council will establish a commission to analyze what is driving a structural deficit in Prince George’s and has asked all agencies to set aside 2 percent of their operating budgets for a contingency fund.
That money, along with $4 million redirected from Baker’s economic development incentive fund, $1 million moved from the fleet-management fund and other revenue shifts, would save the county from having to lay off or furlough workers.
“I absolutely hate the idea of any type of a tax increase,” council member Andrea Harrison (D-Springdale) said before voting yes. But she said the approved budget “keeps us whole, it doesn’t hurt anyone. . . . In the end, we all lose a little.”