Gov. Larry Hogan (R) has released a budget he says increases education spending in the state while simultaneously addressing Maryland’s projected $750 million shortfall for fiscal year (FY) 2016 without raising fees or taxes. The governor’s proposed budget has not been particularly well received in Baltimore City, however, with many criticizing both the scope of the cuts in the budget, as well as the governor’s choice to resolve the state’s structural budget deficit over the course of a single year rather than several.
According to information released by the governor’s office about the proposed budget, state spending on education will total $6.1 billion, including a $45.3 million increase in aid to public schools. The budget purports to expend exactly the $16.4 billion in revenue the state projects to take in for 2016, as well as resolving Maryland’s existing $750 million structural budget deficit.
“I am extremely proud to introduce a structurally balanced budget that puts our state on sound financial footing,” said Hogan in a press release. “But this is just a start. . . . My administration will continue to work to put Maryland’s economy back on track, attract new businesses, and create jobs for the long-term stability of our budget.”
Critics of the budget say the claimed increase in education funding is disingenuous, and that the budget imposes rather draconian cuts to achieve balance in a single year, when those cuts could have been made smaller and spread out over several years to achieve the same end.
According to Bebe Verdery, director of the Education Reform Project at the American Civil Liberties Union of Maryland, the $45.3 million increase across the state is solely a function of teacher pension fund payments, and increases in the number of enrolled public school students – increases legally required by contract (teacher pension fund payments), or by state law (the state’s education funding formula factors-in enrollments and cannot be changed without action by the General Assembly).
“Per pupil, the amount that each child gets from the state is reduced,” said Verdery.
Hogan’s budget actually represents a $35 million reduction in education aid for Baltimore City, savings achieved, in part, by not funding the inflation factor of the state’s education formula, which has been held flat for some time but was set to be funded at a rate of 1.4 percent in 2016, according to Verdery. Hogan does not have the power to unilaterally defund the inflation factor, however, and the General Assembly could restore approximately $75 million across the state in education funding if it refuses to go along with this part of the budget.
Hogan also sought to cut the Geographic Cost of Education Index by half, a special part of the education funding formula received by about half the counties in the state, but which is not required by law. That cut to the index, which does not require any action by the General Assembly to take effect, represents a loss of $11.5 million in education dollars for Baltimore City, says Verdery.
According to Hogan’s office, his budget avoids imposing furloughs or staff cuts on state workers by instead requiring two percent, across-the-board cuts at all state agencies. But Charly Carter, executive director of Maryland Working Families, a progressive organization that works on policies affecting working-class Marylanders, says state agencies may, on their own, decide to meet this two percent cut by reducing hours, furloughing workers, or reducing staff, making Hogan’s claim more of a passing of the buck.
State employees are also losing an expected pay-raise, after foregoing pay increases and enduring other things like furloughs and accepting a greater health care contribution during the recession, says Carter.
“When this state was in its most dire circumstances, it was the public employees that bailed the state out. . . . So I think going back to them and just saying, ‘Well, there’s a piggy bank, we’ll just take it out of their pocket,’ I think that that’s a problem,” said Carter.
Reductions in salaries or to the total number of state workers could hit Baltimore City particularly hard, as state employees account for over 10 percent of the city’s labor force according to the most recent data (2013) from the Maryland Dept. of Labor, Licensing and Regulation.
Both Verdery and Carter say that there was no need to attempt to resolve Maryland’s structural budget deficit in a single year, and that budget cuts, while perhaps necessary in light of the deficit and Maryland’s constitutional requirement to maintain a balanced budget, could have been spread out over time in order to ease the effects of any funding reductions.
“There’s a lot of ways to approach a deficit,” said Verdery, “and usually what’s most successful is when the state does it year by year. The economy is getting better, it’s likely that revenues could be up next year, so why cut so severely right now?”
ralejandro@afro.com