poultry industry – monoblogue

A jealous man can’t tell the truth

If it’s a date on the calendar, it must be a day when someone twists the truth about their political opponents. But this one hits us where we live.

Ben Jealous is one of several Democrats seeking to oppose Larry Hogan this fall, and as his latest salvo he’s accusing Hogan of pay-for-play. Pointing out a recent Wall Street Journal story about how corporate entities are using the respective governors’ associations (both Democrat and Republican) as a means to donate additional funding beyond candidate limits, Jealous claims that “Poultry industry gives $250,000 to help Hogan campaign…Gov. Hogan slashes chicken manure regulation, putting more chicken (stuff) in the Chesapeake.”

The WSJ story is now behind a paywall, but fortunately I have access to the pertinent part for my purpose:

In October 2014, the Republican Governors Association needed help in Maryland, where the gubernatorial race was tight. So it called Mountaire Corp., one of America’s largest suppliers of chicken products.

Companies can’t donate large sums to candidates in many states, including Maryland. But they can give unlimited sums to governors associations, which sometimes use the donations to support a company’s favored politician without any indication in the public record of the original source.

According to a then-RGA official, the RGA needed $500,000 for an ad campaign to help Republican Larry Hogan. Mountaire was facing tough new environmental regulations in Maryland, where it raises and processes millions of chickens every year. Mr. Hogan had criticized the regulations.

Mountaire sent $250,000 to the RGA on Oct. 31, according to filings from the Internal Revenue Service. It didn’t give its Democratic counterpart, the Democratic Governors Association, a penny that year.

On inauguration day, Mr. Hogan blocked the proposal opposed by the poultry industry. He later negotiated new rules that won some praise from environmental groups but also gave the poultry industry more time to comply. (Link added.)

Even the Washington Post noted that the Hogan regulations which were placed as a substitute – something Jealous obviously didn’t mention – were fine with the environmentalists:

Hogan won the support of environmentalists and Democratic legislators when he negotiated a revamped set of regulations during his first months in office. The plan phased in stricter restrictions over a number of years and allowed extensions for some farmers if major problems arise.

So Jealous is sort of hiding the truth, although I expect that out of a politician.

That’s not to say I was enamored with Hogan’s retreat on the issue, which was something I originally was happy to see him address so quickly. However, it also allowed the O’Malley regulations that were on the verge of passing the General Assembly to be pulled, and that was a good thing. But when people try to stir up sh*t by twisting the truth and distorting the record because they have nothing good to run on besides rewarmed old socialist bromides that would bankrupt the state and drive the producers away, I figure it’s time to speak out.

And here’s my question for Ben Jealous: are you going to refuse DGA money or assistance if you get the nomination? Something tells me he’ll be lined right up to receive that manna from heaven if he gets the nomination, so don’t try to sell us your story. You must want to be completely shut out on the Eastern Shore.

Playing chicken with local industry

After controversy about the prospect of large poultry operations with multiple chicken houses (up to a baker’s dozen in one case) as well as concern over the paleochannel that runs near the Salisbury area, County Executive Bob Culver organized a public meeting held earlier this evening to discuss some of these concerns with a number of state officials. Ten representatives, mainly from the Maryland Department of the Environment (MDE) but also representing the Department of Agriculture and the Department of Health and Mental Hygiene (DHMH), were made available to answer questions from a large audience of onlookers.

Culver assured the audience that there were “no predetermined outcomes from this forum,” stressing that the idea was to explore the impact these operations would have on groundwater and the paleochannel, along with the possibility of airborne toxins. Culver noted that a Daily Times editorial penned by local activist Judith Stribling called on us to be “determined to avoid polarization,” and the crowd inside complied.

Outside? Well, that was a different story.

I shared this on social media, noting the anti-poultry zealots had arrived. Yet that band of perhaps three dozen was no more than a fraction of those inside. And it’s a sure bet that many thousands more will be alerted to the results of this meeting on local media.

Needless to say, once moderator Greg Bassett of the Salisbury Independent opened up the questions, which were written by audience members and passed to the front of the room, we had a lot of queries about how the operations would affect the water supply as well as the disposition of the natural by-products of the poultry.

In fact, the first question out of the chute was on how the PMT regulations were affecting the capacity of the land to handle manure. Dave Mister of the Department of Agriculture told those gathered that “we feel there will be adequate land to apply manure.” One thing he didn’t add was that much of the lower Shore has reached its saturation point for phosphorus, so that waste would need to be transported.

But the main thrust of the questioners regarding the waste itself was the effects it would have on peoples’ health. There were no “cancer clusters” being caused by these operations, said Dr. Clifford Mitchell of DHMH. Asthma from airborne particulates could be an issue, but that depended more on the individual and poultry operations couldn’t be blamed as a blanket cause.

The only possible issue could be nitrates in the water supply, which is regulated by the federal EPA to prevent what’s called “blue baby syndrome.” There is no regulation for phosphorus, added John Grace of MDE.

Moreover, the panel agreed health or environmental issues shouldn’t be a problem as long as the operation is run according to permit requirements. The idea is “zero discharge,” said Gary Kelman of the MDE. “No discharge will occur…if the permit is adhered to,” Kelman added. We also learned that they inspect based on complaints, and “we have lots of eyes out there,” said Kelman. Operations are inspected every five years at the minimum, but more often if there are complaints.

This to me may be an Achilles heel for the industry, since those who want to stir up trouble can make it difficult for CAFOs (short for concentrated animal feeding operations) to survive a week without some inspection. (To be considered a CAFO, a grower has to deal with 37,500 or more birds.)

And while they couldn’t answer a question dealing with the carrying capacity of our local industry, Mister admitted the number of chickens being grown was probably increasing. “The industry is growing, and that’s a good thing,” said Mister. The industry has to expand to be successful.

It was interesting to me that one of the more asinine questions was what they would do to protect smaller farmers; a question that received a smattering of applause. Mister simply said that was “best answered by the industry.” But on a compliance basis, he noted that all farmers have issues yet they get “phenomenal” cooperation from growers when there are problems.

We went almost the first hour without getting a question about the paleochannel, but one finally came. And the consensus was that there was “little chance” the paleochannel would be affected by these operations because they were all under roof – even the mortality composters were protected from the elements. In the event of a catastrophic loss, there was also the option of using the manure storage shed. There seems to be a lot of redundancy in the operation as well as in the permitting process.

That process also was a concern of some questioners, who worried that there was an effort to “fast-track” approvals. But the idea was to process them as efficiently as possible, protested Hussein Alhija of MDE, who noted “my job is to improve the process.” Several different state entities have to work in conjunction to get these permits in order. It’s a “very complex process.” noted Mister, who added that education on permitting was important. Kelman chimed in by pointing out lenders need the permits in order to fund the operations.

Nor is the paleochannel in danger from the water usage required by these operations. Poultry growing uses “several orders of magnitude” less water than cropland operations, said Grace. In fact, there is “no declining water level” in the aquafers. “We’re okay as far as the water supply goes,” Grace assessed.

Yet while the answers seemed to be satisfactory regarding water quality and permitting, those who thought CAFOs could be eliminated from being adjacent to residential areas were likely disappointed. The only standard that applies as far as the state is concerned is that operations must be 1oo feet away from “waters of the state.” Otherwise, Kelman conceded that it “seems to be a local zoning issue.” Given that residential development is oftentimes adjacent to land zoned agricultural, that will be something the county would need to address.

And there will still be people who are aggravated, even with all the assurances from the state group.

Perhaps the creator of this sign is related to the late William Donald Schaefer, the onetime governor who called the Eastern Shore the “shithouse” of Maryland.

In about an hour and a half, though, we all got a little understanding about the permitting process prospective growers have to go through, and perhaps it’s the idea that dealing with one big farm and one permit rather than several operations that is making the large-scale farms the better business model.

In his introduction, Culver noted there are 2,300 employees of local poultry companies. That’s a decent percentage of the local workforce, and it doesn’t count the ancillary jobs created by the need for these employees to live their lives. If the supply chain of chicken dries up, there will be a significant impact to our local economy that low-impact tourism can’t replace.

Given the evidence that the state of Maryland is trying to be of assistance to growers in maintaining a clean environment, the only explanation for the opposition is that it’s being whipped up by Radical Green, with the paleochannel just an excuse to stop vital development. With the steps being taken to treat stormwater and precautions being taken to keep farm operations as environmentally friendly as possible, I think that chicken growers are trying to be the best neighbors they can – it’s the outside extremists who are trying to foul our economic nest.

A look ahead: 2016 in Wicomico County

After doing this the last two years one would think I would be an expert at dissecting what will go on over the course of a year, but in this case my crystal ball is a little bit cloudy. Perhaps that’s because things are looking up for a change.

I went to the state Department of Labor, Licensing, and Regulation website and downloaded some figures which reflect great job creation news – particularly in the latter half of this year. Since June, Wicomico County employment figures are running between 1,300 and 1,800 jobs higher than the corresponding month of 2014. Conversely, in 2014 we never ran more than 753 jobs ahead of 2013 and by the end of last year we actually had fewer employed than the year prior. That downturn carried into this calendar year but by March we had turned the corner.

The growth in the latter half of the year was reminiscent of the boom period of 2004-06, when Wicomico County routinely gained 1,000 or more jobs in every month year-over-year.

So the question will be whether county revenues begin to increase. Unlike the boom of a decade ago, which was fueled by a rapid increase in property values that later translated into increased tax collections, this upturn doesn’t come with rapidly appreciating property values. And there are plenty of bills for the county to pay – two new schools with a third one now placed into the pipeline as well as new facilities for the Board of Elections, increased mandates for education spending and environmental cleanup from the state and federal governments, respectively, and a call from the city of Salisbury to assist them more with fire protection expenses through a more equitable revenue sharing. Certainly it appears that any new money has a number of hands reaching out for it.

Another question regards how well two relatively new leaders will work with each other. It’s fortunate that both County Executive Bob Culver and Salisbury Mayor Jake Day spent a little bit of time on the legislative side of things because it will help them understand the process the other has to go through to get things done. If there’s one thing we have learned from Culver, though, it’s that he’s a man of action who always seems to have a to-do list of improvements he’d like to see. It’s more autocratic than bureaucratic on the county side of the Government Office Building these days. Initial impressions of Day seem to be similar, although he’s made much less of an impact on taking office than Culver did insofar as personnel decisions are concerned.

But there are two key issues regarding education that will be out of Culver’s hands. One is the fate of the elected school board, which is now up to the Maryland General Assembly. The other is the new superintendent that will take over the county schools sometime in 2016. The Board of Education begins the selection process after the holidays – by the way, the county Republican Central Committee will be called upon to retain or replace two GOP members of that body this summer.

Getting around may become a little more difficult next fall as well, as the state will begin replacing 11 bridge decks on the U.S. 13 bypass. It’s a project that’s not supposed to impact summer traffic in 2017 but won’t be complete until 2018.

In comparison to previous years there doesn’t seem to be anything particularly contentious on the horizon – with the possible exception of the proposed large-scale chicken farms Radical Green is already up in arms against – which probably means we’re going to have an interesting year. If we can keep up the pace of job creation, though, eventually the local economy will get back to where it was a decade ago and prosperity takes care of a lot of problems.

Tomorrow I shift my focus to the state as a whole.

PMT: not eliminated, just pushed back

Yesterday, Governor Hogan announced that some local farmers will have tough new phosphorus regulations placed on them this year. While it wasn’t his overall intent, the news could be devastating to any local farmers who have existing high phosphorus content in their fields as it will necessitate their relocation of any manure present and prevent them from utilizing that fertilizing technique until 2022.

For the rest of the agricultural community, the change is a simple one-year reprieve from the regulations taking effect. Overall, the regulations aren’t a whole lot different from previous proposals. Granted, the new regulations Hogan proposes set up an on-farm economic analysis, but that should have been the first step well before the regulations were published and affecting many Maryland farmers.

So while the state is putting together a pretty picture of the new regulations’ effects, it may simply be a capitulation by the Hogan Administration as they try and put their best face on a fait accompli – SB257/HB381, which codify the PMT regulations slated for adoption before Hogan pulled them hours after taking office January 21, have hearings this week and both have a substantial number of co-sponsors.

For his part, Hogan bills it as a “fair and balanced” proposal:

We have listened to the agricultural and environmental communities to find a fair and balanced plan for limiting phosphorus, and I am pleased to announce the details of that solution today. The enhanced phosphorus management tool regulations and the broader Agriculture Phosphorus Initiative will protect water quality in the Chesapeake Bay while still supporting a vibrant agriculture industry in Maryland. We are providing immediate action to limit pollution, investing in new technology, seeking alternative uses for manure, and improving on-farm management of animal manures – none of which were included in the previous proposals.

It seems to me the time to do the enhancements would have been before most farmers were affected. The excuse for an economic study produced by the previous administration noted the plan would cost farmers (and taxpayers) millions of dollars for comparatively little benefit to Chesapeake Bay. The impetus for the “Agriculture Phosphorus Initiative” should have been to study the effects on real farms first – which is part of this effort, but done simultaneously with the restrictions rather than in advance of them.

Moreover, we don’t know how quickly some of these waste conversion initiatives will get online despite the $2 million the state recently granted three such operations, including one in Worcester County and one in Dorchester County. How scalable these operations are is yet to be determined, but the need for their assistance in waste disposal will arise rather soon.

In short, there was a reason the Eastern Shore agricultural community was pleased about the demise of the PMT regulations – not that they want a clean Chesapeake Bay any less than anyone else, but because they can make a case that they have done their part yet still seem to be the target of more and more regulations. That month of triumph appears to be coming to a close, though, and while Hogan calls it a enhancement the end result will still likely be economic damage to Eastern Shore farmers.

The economic viability of producing poultry in Maryland may be a casualty of these new regulations as growers may find the market for their by-product suddenly diminished. Without the ready availability of chicken waste through the departure of the industry, the environmentalists may succeed in driving the soil phosphorus levels down, but there will be much less economic activity to speak of as well.

The War on Rural Maryland: a counterattack from the hinterland

In the ongoing quest by Martin O’Malley and his administration to burnish his environmental credentials for a possible presidential run, the farmers of the Eastern Shore have been placed squarely in his crosshairs. I suppose this is MOM’s way to catch the fourteen counties not yet affected by his “rain tax,” although some local municipalities are joining in on that fun without waiting on the mandate.

At the beginning of the month, the administration began once again to try and enact the Phosphorus Management Tool, or PMT. The timing was important because the mandated public comment period comes to a close December 31, three weeks before MOM rides off into the proverbial sunset. Appeals for a public hearing have thus far fallen on deaf ears, so the comment period is really the only opportunity to make our voice heard. (Comments should be addressed to Maryland’s Secretary of Agriculture, Earl Hance. His e-mail address is earl.hance@maryland.gov.)

Needless to say, the environmentalists are thrilled about this prospect, including a “Maryland Clean Agriculture Coalition” which doesn’t have a single farming-related entity within it. They note the 48,000 pounds (24 tons) of phosphorus the PMT is supposed to alleviate. Remember that number because it comes up later.

The Clean Chesapeake Coalition (CCC) chimed in with its appeal, which states in part:

In furtherance of this objective and in the interests of its individual county members, the Coalition opposes the re-proposed regulations and requests MDA to withdraw the regulations for the reasons explained below. In sum, the implementation costs to farmers, the costs to taxpayers, the adverse impacts on local and regional economies, and the overall added strain from more piled on Chesapeake Bay Total Maximum Daily Load (“TMDL”) driven regulations far outweigh the purported reduction in overall phosphorus loading to Maryland waters and other speculative environmental benefits that may result from the PMT regulations.

In reading their ten-page letter to Secretary of Agriculture Earl Hance, the points made by the CCC appear to be as follows:

The economic effect on businesses is “grossly understate(d).” While the BEACON study was done in order to satisfy the demand for a study of these effects, its author admits it “was not meant to serve as a comprehensive economic impact study.”
Remember that 24 tons of phosphorus these regulations address, at a cost of $61 million over six years in increased expenses from farmers and state subsidies? The flow running through the Conowingo Dam spews out 3,300 tons of phosphorus a year – it’s like sticking your finger in the hole in the dike and ignoring the water pouring over the top. Meanwhile, the pond behind the dam has another 130,000 tons just waiting to be scoured out in a significant storm event.
Phosphorus concentration in tributaries of the Susquehanna River north of the dam is over 3.5 times greater than comparable tributaries on the Eastern Shore.

On that last point, it’s helpful to use the illustration the CCC provides:

Phosphorus is loaded into the Bay at an average annual rate of 3,300 tons (6,600,000 lbs.) from the Susquehanna River; not including what is scoured from the full reservoirs in the lower Susquehanna during storm events and on a more regular basis. Maryland’s annual average phosphorus loading to the Bay from agriculture of 985 tons (1,970,000 lbs.) is minimal when compared to the Susquehanna River.

Earlier this month, Exelon withdrew its request for renewal of its hydroelectric license at Conowingo Dam because more study of its effects on water quality downstream were desired. The utility has agreed to spend up to $3.5 million on studies of water quality downstream. It appears they’ve also become aware of the detrimental effects on the Chesapeake Bay, yet the environmentalists don’t seem to be interested nearly as much in Exelon and in the Conowingo Dam as they are the poultry industry.

A Washington Post story over the weekend noted the controversy, including remarks from Wicomico County farmer Lee Richardson, who seems to be something of a go-to guy when it comes to poultry growers. Many of the reader comments on the Post piece, though, illustrate the divide between the urban and suburban hipster whose idea of poultry is the organic chicken they buy at Whole Foods and the beleaguered grower who already has to comply with numerous state and federal guidelines without having to worry about arrangements to truck chicken droppings out of the area. The Post readers blame the industry itself, saying that its not carrying its weight in addressing the concerns about water quality – bear in mind these are the people who were just fine with enacting a nickel-per-bird “chicken tax” called the Poultry Fair Share Act which was supposed to raise $15 million a year.

In that fiscal note from the Senate bill, it’s noted that the Eastern Shore has “over 700” poultry farmers. For ease of calculations, I’ll set the number at 750. If the cost to farmers is $22.5 million over 6 years – as estimated in the BEACON study – it works out to $30,000 per farmer over the six-year period or $5,000 a year. That’s a significant compliance cost – assuming, of course, it’s really true because government estimates are generally optimistic on revenues and short on expenditures.

So here’s hoping that our efforts can bear fruit and stop this particular piece of madness once and for all. There’s still time to comment.

Easy pickins

You wouldn’t necessarily think of him as the farmer’s candidate, but Charles Lollar has at least paid a little bit of attention to how environmental factors affect one of Maryland’s top industries. Recall that he spoke at length about the Hudson case in one of his initial campaign stops, and it may not necessarily surprise you that he’s now making hay out of what’s he dubbing the “chicken tax.”

The “Chicken Tax” is another “Rain Tax” moment in Maryland history. Farmers in Maryland should be outraged. Agriculture is the number one economic industry in Maryland. It accounts for $2.3 billion in gross receipts to the economy annually and generates approximately 46,000 jobs. More than half of these jobs are on the Eastern Shore. Why are legislators willing to risk all that?

We need a balanced approach to solving environmental issues in Maryland. Keeping the Bay clean is a regional problem that involves more than controlling agricultural run off from Maryland farms. Sediment from adjacent states, like Pennsylvania, contribute to the pollution. Leadership in Annapolis needs to craft a regional solution to this problem that requires all states that pollute the Bay to “pay their fair share” to keep it clean. We must not allow legislators in Annapolis to “hurt Maryland first” by bankrupting hard-working farmers with a “Chicken Tax” and putting the future of Maryland’s number one economic industry at risk.

Given Lollar’s propensity for shrill populism, I took the liberty of reading the bill in question, Senate Bill 725. (The same bill is in the House of Delegates as House Bill 905, a common Maryland practice.) The Senate bill’s lead sponsor is Richard Madaleno, a Montgomery County senator whose experience with chicken is probably that of seeing it at Whole Foods. (He seems the vegetarian type.)

Basically the bill as proposed, called the Poultry Fair Share Act (PFSA), tries to “achieve” two things: raise money from poultry processors like Perdue, Mountaire, Tyson, etc. at five cents per bird and establish a bankroll to “fund cover crop activities on agricultural lands upon which chicken manure has been applied as fertilizer.” The secondary purpose of the bill is to increase the share of money going into an existing state fund to reimburse owners of failing septic systems who have to replace them with a system with enhanced nitrogen removal – currently that fund shares its proceeds with the cover crop program on a 60/40 basis, with the cover crops getting the 40% share.

Needless to say the local producers are feeling a little put upon, as would anyone subject to a bill arbitrarily deeming that it pay a “fair share.” Madaleno is probably upset because his county has to pay the aforementioned “rain tax” but no Eastern Shore county yet has to (although certain muncipalities in the region already collect such a tax.) Prominently featured on the webpage of the Delmarva Poultry Industry homepage is a series of questions about the PFSA.

So my question is simple, and it applies to any candidate, including Lollar. How many of you will put your money where your mouth is and go testify against the Senate bill when it comes to a hearing on Tuesday, February 25th at 1 p.m.? Certainly these candidates are willing to put themselves out for gun rights and stand against taxation in general, but who is going to face down the environmental lobby in this state and politely (or better yet, impolitely) tell them to do the anatomically impossible and go f–k themselves?

Writing a press release is one thing, but we need activists. Personally I’m tired of seeing the agricultural industry in Maryland – no, wait, the entire rural slice of the state in general, whether it be farmer, resident, or small business – be the featured whipping boy for groups which would just as soon see the non-urban portions of the state revert to their once-wild condition. Yes, that means you, Waterkeepers Alliance, Food and Water Watch, and even certain members of the Chesapeake Bay Foundation. I’ve only been here a decade, but I spent my teenage years in a rural area and I think we all got along just fine without you because – as they often note – farmers are the original environmentalists. We might not have liked it a whole lot when the wind blew the perfume of the pig farm down the road our way, but it was a small inconvenience for the rural living my parents desired.

I happen to think we can have it all – a great quality of life, economic growth and the jobs it creates, and water quality suitable for the recreational and aquacultural purposes we demand from Chesapeake Bay – without these environmentalists coming in and mucking up the works with overregulation and harsh taxation. Hopefully we can count on all four GOP gubernatorial candidates to stick up for the farmer in this fight.

Observations on the Conway-Mathias townhall meeting

Even with a camera-shy person, the attendance on Saturday wasn't half-bad for this townhall meeting.

On Saturday I was joined by about two dozen others – among them seemingly half the local blogger community – who wanted to pepper local Delegates Norm Conway and Jim Mathias of District 38B with questions about the direction this state is going and just what they would do to send it in the proper direction. At times this was a very contentious meeting when the questions began to be asked.

First they were introduced by Salisbury Mayor Jim Ireton.

Fellow Democrat and Salisbury mayor Jim Ireton introduced the pair and pitched a new downtown library while he was at it.

Part of his introduction was an appeal to keep the library downtown, but as for Conway and Mathias Mayor Ireton noted that, “one of the reasons I support them is that they don’t vote no for the sake of voting no and they don’t vote yes for the sake of voting yes.”

Mathias began his presentation by stating “I’m just like you in many ways,” pointing out he had been a businessman, vetoed two budgets as mayor of Ocean City, and argued about increasing fees. Along with us, he felt that the state “should have a dependable budget” and asserted that he’d “stand up and take responsibility for the good things we’ve done and the tough things we’ve done.”

Jim seemed very defensive throughout the presentation, and speaking on the budget remarked that “we thought we’d close the (budget) gap (in 2007)…but we didn’t know the ‘great recession’ was on the way.” He made it clear that there were “a thousand sets of fingerprints to blame” so we needed “a thousand sets of hands to lift us up.”

Noting that much of the industry which had once been the backbone of the Shore – companies like Campbell Soup and Dresser – had abandoned the area, those entities which had taken their place like Salisbury University, Wor-Wic College, and Peninsula Regional Medical Center helped take up some of the slack but our number one industry remains agriculture. On that note, Mathias pled the case that they “tried very hard to get building permits for the chicken houses.”

District 38B Delegates Jim Mathias (left) and Norm Conway listen and interact with their constituents at a town hall meeting held February 20, 2010.

Unlike Mathias, who sat throughout the meeting, Norm Conway stood up to give his remarks.

One thing I didn’t know about Conway is that he’d been an elected official since 1970, beginning with the Central Committee and graduating to Salisbury City Council in 1974 before running and winning his current post in 1986. He recounted some of the mentors who had led him into his lifetime of public service as a teacher, school official, and political officeholder.

As a committee head in the General Assembly, he “tried to build alliances…build bridges” as Norm reminded those assembled that the sum total of the Eastern Shore delegation was 13 – 10 House members and three Senators. (Seems like it should be 12 because there are only three Eastern Shore districts – 36, 37, and 38. Point is we have a small delegation.)

Certainly those in attendance had known that Maryland “had some rough times over the last 2 or 3 years” as “revenues dropped off a cliff.” In the last year the Board of Public Works had chopped $1 billion out of the budget – it had been in balance at sine die of the General Assembly last April but once the fiscal year started July 1 things were already behind.

Norm observed, however, that revenues may be finally leveling off. His anecdotal basis of that claim was seeing more people shopping and in restaurants over the last few months, and to him that was “clear evidence” of a recovery.

But now the General Fund budget being debated was less than that approved for FY07 four years ago thanks to the shrinking revenues. Yet the untouchable area has been K-12 education and it was only this year the tuition freeze had been shelved, after three years of no change.

Delegate Norm Conway addresses the voters at a townhall meeting held in Salisbury on February 20, 2010.

As for the actual budget process, this year it was the Senate’s turn to begin the budget process (it alternates yearly between the Senate and House of Delegates.) Conway predicted the budget would be on the floor by the second week of March. One lament Conway had was the difficulty of maintaining funding for roads because once that area was cut it was “tough to catch up.” Yet we had to balance the budget and create jobs since Maryland’s 7.5% unemployment rate, while well below the national average because of the insulation of federal jobs, was still at a “high water mark.”

So far the meeting had gone fairly smoothly and people had listened attentively. Then the questions began.

Local Americans for Prosperity co-chair Joe Collins got the ball rolling by pointing out the examples of Dresser leaving and the Evolution microbrewery deciding to locate just across the state line in Delaware (after considering a downtown Salisbury location) and asking what can they do for the business community?

Mathias, who reminded us he was on the Economic Matters Committee, told us that part of the issue was local regulation. But he and Conway had urged a reduction in regulations, and Mathias called the poultry industry regulations “overbearing.” Jim also called it “embarrassing” that a permit for a fishing pier desired by a local businessman had languished for two years – that owner “should have had it in his hand by now.”

The former mayor also made the complaint that “as mayor, I was closer to a one phone call fix” but the state is a “matrix.” The only group which stays long-term is the bureaucracy.

Collins interjected that it sounded like Mathias was “making the case for less government.” Jim agreed that there was a need for incentives, less regulations, and more opportunity.

Delegate Conway spoke his piece, talking about how the poultry industry could be gone in a decade if things continue on their path, but bringing up the point that he has to work with other members and “help them.” But as head of the Appropriations Committee, “I do” use that as a weapon against the Maryland Department of the Environment in an effort to help local poultry farmers.

So when it was asked what they were doing to get rid of the bureaucracy, Conway pointed out that 400 vacant positions had been eliminated this fiscal year – but that may not be permanent.

Delegate Mathias then pointed out that, “bureaucracy is not just numbers…every business needs to have trained people.” Yet the government will have to continue to shrink, added Jim. Earlier this decade, we were largely in the ‘roaring Twenties’ of the 21st century.

Local businesswoman Sally Jones then asked about unemployment insurance, noting how much it affected her business.

The problem, responded Mathias, was that businesses were moving to a higher table on the unemployment scale and that raises their premiums. One change last year was adding part-time workers to the rolls, a move the Chamber of Commerce supported but Jim opposed (as did I.) But Jim also couched it as an issue between big business (like Wal-Mart, as Jim naturally mentioned) against small business and the NFIB.

Yet I happen to know there’s also a federal impact, as the bailout being proposed comes with strings attached. With Maryland’s fund in peril, the state is looking for an infusion of federal cash but in order to get it they have to “reform” their system (after just doing so five years ago.)

At that point, a questioner asked about illegal immigrants and the fiscal impact they have on our state, but neither Delegate was aware of a financial number and Mathias “doubt(s) my committee” has ever asked for one. Remember, Maryland is well known as a sanctuary state and is adopting a two-tier driver’s license system just for them. (That was a contentious bill, and many Delegates – including Conway and Mathias – asked their name by withdrawn as co-sponsors after numerous changes were made to gut that bill.)

Shifting gears, fellow blogger Joe Albero asked about the death penalty in the wake of the Foxwell case. Conway expressed his support for the death penalty but voted to weaken it in order to make sure it stayed on the books, noting wistfully “they have it where they want it” for now. He’s working on a bill to be heard tomorrow which would add scientific evidence to the criteria where the death penalty can be sought. Delegate Mathias chimed in that there “will be improvements” to sex offender laws and echoed Conway’s support for capital punishment.

Another fellow blogger (and the other AFP local co-chair), Julie Brewington, asked about the gas tax and why so much of it goes to public transit. Mathias said that he wouldn’t support an increase but also countered that “we all know we have to make that contribution” and perhaps change the funding mechanism for fixing roads as cars get more efficient. After our economy finally recovers, this will be “a different country than we know.” (He also had a sidebar about the one staunch Republican who supported Obama’s stimulus plan – that man runs a paving company.)

But here was a case of the quid pro quo which permeates Maryland politics. Delegate Mathias recounted his first votes, which were to override vetoes by Governor Ehrlich of various Baltimore City and County issues. He was going to sit them out (since he never voted on the original legislation) but was reminded by Norm Conway that the items he liked getting as mayor of Ocean City had to have the approval of Baltimore-area legislators to be done. In this case, they support the public transit predominant on the other side of the Bay as a trade-off for things we need.

One item that Conway said has been proposed in the past and could be revisited to address transportation would be a regional sales tax.

Johnnie Miller, a proponent of energy legislation, wondered why renewable energy bills pass the House easily but die in the Senate Finance Committee. He pointed out Delaware is way ahead of us in that area. More interesting was the fact he and fellow advocate John Palmer had written the draft of legislation to be introduced this year (they were only awaiting the legal language to be set) for energy policy.

To address the question, Delegate Mathias pointed out these bills generally come with a “strong fiscal note” which seems to scare off support. (Tellingly he also said, “maybe one day I’ll be on the Senate Finance Committee.” File that under “worst-kept secret.”)

This touched off a long and sort of meandering discussion which eventually returned to jobs and development. While it was pointed out (properly) that renewable energy was only made competitive when subsidized by the government and certain interests were more focused on rent-seeking than energy policy, the philosopical question was asked “how is it that government ever thought they could create development?” To that, Delegate Conway replied that there were a number of public-private projects under discussion but when pressed couldn’t name any local examples.

Delegate Mathias attempted to bail Conway out by postulating that even with the increasing amount of real property now owned by government (such as the ever-expanding Salisbury University and even the newly-purchased Pollitt’s Folly parking lot for the Civic Center) there are still jobs and disposable income being created by them. With all due respect, Delegate Mathias, at what cost to us? (I used that term because Delegate Mathias used it often.)

This is basically how it ended, since the time allotted for the meeting room was only two hours and it was booked for another group. I didn’t get a chance to ask my question, but did say my piece to Delegate Conway about the increasing proportion of the state budget comprised from federal dollars. To him, it was just our money coming back to us but that doesn’t address the philosophical difference I have that the money belongs to us in the first place and all that having a middleman does is keep some pencil-pusher (who may or may not live in Maryland) employed.

There was also a comment made by a guy whose name I didn’t catch which, to sum up, said that we should watch the Delegates in action before being overly critical. Come to Annapolis and watch them work on a Monday night or some other time during the week, he said.

That’s all well and good for a lobbyist or perhaps CASA de Maryland, but most working people in far-flung regions of the state don’t have the time to drive up to Annapolis and watch the legislature grind its sausage. We count on them to do what’s right and what’s proper in being stewards of our taxpayer money.

Instead we get “I’ll scratch your back if you scratch mine” politics, trading favors at the expense of the taxpayer. So much for “One Maryland.”

A blizzard of budgeting

While the 2010 election is over eight months away, in sitting here watching the snow come down yet again this gives me an insight on writing a relevant post; one about the role of government.

One thing we expect for our tax dollars is snow removal, but this fickle and historic succession of snowstorms will certainly strain budgets in the affected counties and states. I’ve lived in Maryland for six winters now and some of them had less snowfall in toto than we’ve had in the last two weeks. It’s been a long time since I’ve seen 2 feet or more of snow in the backyard, and obviously that makes clearing highways a dicey process, let alone running a plow on the side roads.

Yet my fear is that we overcompensate next year and expect more storms of the century in the budgetary process. Certainly many scientists see us entering a long-term period of cooler weather than we’ve come to expect, but it’s highly unlikely that the winter of 2010-11 will see our area become ground zero for winter storms again. A manner of comparison can be drawn with hurricane seasons – some seasons Florida is hit hard, sometimes it’s the Texas Gulf Coast, and at times the Outer Banks seem to be in the crosshairs. Last year we even had the variation of an eerily quiet hurricane season.

But these storms have also proven that we can’t simply count on government to bail us out.

I have good friends who live in rural Delaware, and last weekend’s storm meant they had to do without power for the better part of two days. Obviously part of their issue was being in such a remote location, but the utility claimed they couldn’t get their trucks onto their road because it wasn’t plowed. As it turned out, the government didn’t plow their road – a local farmer did. (More importantly, the farmer helped the community by bearing the cost himself for the gas and use of his tractor.)

On a larger scale, allocation of a finite amount of resources is a tricky thing. Ask someone who was looking for a snow shovel this week whether they wished they’d purchased one a month ago and the answer would likely be yes. But, based on the experience of previous winters people felt no need to invest in a snow shovel. They do invest in bread, milk, and toilet paper on a usual basis, though, but you’d never know that with the panic buying which has occurred over the last couple weeks.

However, it is easier for private enterprise to find scarce resources than it is for a bureaucracy to do so – that Titanic is much more difficult to turn around once the course is reset. It’s for this reason I’ve often opined that there are a number of services which may work out better if done by the private sector than the public sector, and snow removal is one. No, it’s not foolproof and there is the possibility of corruption in awarding such a contract as opposed to having county or state workers do that job in addition to other tasks, but I think it’s worth exploring due to the obviously cyclical example of weather.

It also goes without saying that next winter may see a slew of entrepreneurs who will see the booming business private snow removal has done over the last month and hope to cash in next year. This could make the price of snow removal via private contractor more attractive – so why not consider the option?

One other thought occurs to me as I listen to the news of several roof collapses affecting poultry farmers.

With the difficulty these businessmen have had in erecting new chicken houses because of EPA regulations, will the damage from this storm hasten the long, slow decline of the poultry industry Delamarva is enduring? The industry is supposedly moving south already, so this storm just may be a fatal blow to some growers.

These chilling thoughts aren’t exactly the type preferred to get through what’s become a historically rough winter, but we as a region need to ponder them since we have little else to do as we’re buried farther in snow today.