A sneak attack (on our county taxpayers)

Two similar (but not identical, thus not crossfiled) bills have been introduced in the General Assembly this term, measures which would thwart the will of voters in Wicomico County and elsewhere in Maryland.

First among them was SB740, which was introduced February 3 by Senator Richard Madeleno of Montgomery County, which is one of the counties that inhibits property tax collections in some manner. (The others are Anne Arundel, Prince George’s, Talbot, and Wicomico.) It’s a bill which would simply allow counties which have this sort of cap to circumvent it, provided the money goes to the county’s school board.

But HB1412, which was introduced on February 28 – and got the extraordinary benefit of a hearing just two days after introduction – would do grave damage to the financial bottom line of several counties, most particularly Wicomico. It’s notable that Delegate Norm “Five Dollar” Conway is a co-sponsor of the bill, which is led by Delegate John Bohanon of St. Mary’s County and also backed by members from Baltimore City and Baltimore, Howard, and Montgomery counties.

Apparently this will affect Wicomico County in two ways: first of all, their maintenance of effort (MOE) won’t come down to a more realistic level based on tax revenues – for FY2012 they were over $14 million short of the $50 million MOE goal, the largest percentage of any of the state’s 24 counties – and our MOE will likely automatically increase up to 2.5% each year after FY2015 because we’ll almost certainly be considered a “below average” county. At a starting point of $50 million, that’s an extra $1 million we would have to come up with (or roughly 1.5 cents per $100 extra on property tax rates, based on what the county currently receives) annually. That’s also faster than our revenue cap would allow, since it’s based on an increase of no more than two percent.

But the other problem the bill will create is shorting other areas of the county’s budget which depend on the state – according to the fiscal note for HB1412, “(i)f a county does not fully fund MOE and has not received a waiver, the county’s income tax revenues will be intercepted and sent to the school board.” In other words, we lose the local control we have on state funding.

Now some may argue that because the state is providing the funds, they should call the tune. I don’t disagree with that, but if they want to play that game I’d like to see an opt-out provision. Call their bluff: okay, if you want to take away our local control of the money then we don’t want to send you our taxes. Obviously that’s not going to happen anytime soon.

And the problem most people have with the local Board of Education isn’t one of necessity. Few would argue that we don’t need public education as an option.

But there are a lot of us who feel money should follow the child, regardless of where the parents wish to send them to school. By bringing that element of competition into it, schools are forced to improve and provide more bang for the buck. Certainly I’m aware that Wicomico County schools have been studied and found to spend a below-average amount on administrative costs, but it certainly seems to me that the things the Board of Education likes to project as cuts are the ones which provide the greatest shock value. Yet what would our financial situation be like if we simply increased the average class size to 25 students? How much help would that provide?

I seem to recall that once upon a time our County Executive vowed he would do zero-based budgeting as he did as Fruitland’s city manager, beginning each year from scratch. It doesn’t seem to work that way at the Board of Education, which seems to assume they are entitled to every dime they can extract out of our pockets and then some.

And, needless to say, this bill would also provide impetus to opponents of the revenue cap to push for its removal – “the children are hurting,” they’ll whine in a tone which will remind me of those who are dismissed as the “Bennett babes.” But that squeaky wheel got the grease, didn’t it?

I suspect the long-term answer, however, may be for Maryland to give local districts taxing authority like they have in most other states. Certainly this has its drawbacks – for example, my alma mater district derives revenue from both a local income tax and a local property tax, which is somewhat rare among Ohio districts – but at least there may be a little bit of a chance for local control and reform. (The reason for this dual taxation practice is that a vast percentage of the district consists of low-value agricultural land but many of the families on the eastern edge of the district have reasonably high-paying jobs in nearby Toledo and moved to the school district for its lower property taxes.) If a school board isn’t doing its fiduciary duty by the taxpayers, the option is there to “starve the beast” until needed changes are made.

I don’t know what the fate of these two bills will be, but if one or both are passed it will change the local financial landscape for the worse. Those on the side of the statists never fail to make everything they do hurt the “country class” like hell, and this will be no exception.

Author: Michael

It's me from my laptop computer.

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