Plan Maryland Affecting Local Government

March 29, 2012

On December 19, 2011 Governor Martin O’Malley signed an executive order, Plan Maryland, stripping local governments of their zoning and land use power. Before that, local elected officials were accountable to local voters, deciding when, where and how much new development would take place in their county. Officials also told the state where to build roads, schools and other infrastructure. From now on the governor and his staff will decide where to build the infrastructure, thereby determining where, when and how much local development will take place.

Another part deals with limiting septic tanks in areas not served by public sewer systems. Approximately 28% of new housing is built in these areas. O’Malley’s bill, in most cases, would ban septic tanks in these areas even if the area has the necessary schools, roads and infrastructure. This will halt rural growth and redirect it to the cities. Baltimore City and all municipal corporations will see an increase for residential development. In Garrett County 90% of the land falls under the septic tank ban.

Another component of the legislature is what will happen to the counties’ fiscal powers. In order to meet the State’s Budget, the legislature is sending $250 million of teacher pension costs to the counties. The state sets pension benefit levels, controls pension fund investment, underfunded the pension fund and after 85 years is telling the counties to pay the tab. The state is classifying this as a “state spending cut”.

Counties banded together with local school boards, teachers unions and other interested parties and put up a fight to stop the pension shift. Legislative leaders responded with $800 million in spending cuts as a backup if the pension shift failed. The legislatures proposed a Maintenance of Effort bill that protects teachers unions and school boards from any local spending cuts caused by pension costs. In other words, local government must give the schools as much money as they got the previous year. In essence, the state is deciding school spending levels instead of local government.

The new Maintenance of Effort bill allows local governments to ignore voter-imposed limits on local tax increases and raise taxes to fund the state-imposed local school funding levels. If the county fails to fully fund the local schools, the state will seize the county’s income taxes and give it to the schools. Any county that doesn’t meet the new Maintenance of Effort index must add even more money to its school budget. With this new bill, teachers unions have backed off the “Stop the Pension Shift” and are working to re-elect the state lawmakers. This leaves county governments to fight the battle alone.

Margit Miller/Staff Writer/Editor

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