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State Pension Board Adopts New Actuarial Assumptions, Could Lower Teacher Pension Normal Costs

At the meeting of the State Pension Board yesterday, the Board adopted new actuarial assumptions that could lower the normal costs of the teacher pension plan and considered a new method of funding the administrative costs of the system.

Gabriel, Roeder Smith & Company, the State’s actuary, presented the results of the Maryland State Retirement and Pension System experience study and the State Pension Board voted unanimously (all members present) to adopt new actuarial assumptions. The new assumptions could lower the normal costs of the Teacher’s Pension System by $31M for FY 2016.

A decrease in normal costs in FY 2016 does not affect the county contribution towards normal costs for FY 2016. For FY 2016 and every year thereafter, county governments contribute a statutorily set amount towards the teacher pension normal costs. In FY 2017, county boards of education will begin to contribute towards the teacher pensions, too, providing the difference between actual teacher pension normal costs and the county government’s contribution as required by law. For more information on the predicted decreases, read the calculation from the State actuary here.

The actuary also noted that in its current valuation, the administrative expenses of the plan are assumed to be funded from investment returns. In actual practice, the State is making additional contributions for administrative expenses, and allowing participating governmental units to deduct their administrative fees. The actuary recommended that the Board align the valuation assumption with actual administrative practice. MACo anticipates this change leading to legislation that would remove the ability of participating governmental units to deduct administrative fees. Administrative fees for county participating governmental units in the State plan combined were about $1M in 2013. For more information, see our previous posts, Locals In State Pension System May Face New Costs, and Pension Administrative Fees Withdrawn.

MACo continues to work with the State Retirement Agency and county representatives on the State Pension Board on accounting for unfunded liability allocations under new GASB rules. MACo and MML are seeking accuracy in accounting for the unfunded liabilities of the municipal pool, which are less than those of the State Pension System as a whole. The State Board did not discuss the topic yesterday. For more information about this issue, see our previous post, MACo, MML Pursue Pension Liability Reporting Process

Chesapeake Bay Watershed Agreement Management Strategies Being Finalized

As previously reported on Conduit Street, Maryland joined the other Chesapeake Bay states in signing a broad new watershed agreement in June of 2014.  This agreement was less specific than the 3 prior agreements but its 10 goals and 29 outcomes included new issues, such as climate change and pollution from toxins.   Conduit Street also reported that management strategies would be created through the Chesapeake Bay Program for each of the 29 outcomes.  Each Bay state would choose which of the outcomes it wished to pursue – Maryland chose to pursue all 29 outcomes.

The strategies are currently being finalized, with public comment ending a few weeks ago.  The strategies cover a broad range of issues, including climate adaptation, fish habitat, forest buffers, wetlands, 2017 and 2025 watershed implementation plans, toxic contaminants policy and prevention, land use methods and metrics development, local leadership, and diversity.  Many of these strategies have the potential to affect local governments,  although only those strategies dealing with water quality specifically require local government participation.

Once the strategies are finalized, work with begin on creating work plans to implement the strategies.  Draft work plans are expected to be finished by October and put out for public comment.  Completed work plans will be due in late December of 2015 or mid-January of 2016.

The Bay Program continues to hold meetings on the different strategies and work plans.  For example, the Partnering and Leadership Goal Team, which is finalizing the local leadership management strategy, met on May 18.

Please contact Les Knapp at 410.269.0043 or if you have questions about the management strategies or work plans or upcoming goal team meetings.

Chesapeake Bay Management Strategies Dashboard

Chesapeake Watershed Agreement 2014

Governor Hogan Appoints Two New Members of State Board of Education

Governor Hogan has appointed two new members to the State Board of Education. As reported by the Maryland State Department of Education,

Chester E. Finn, Jr., Ed.D. of Montgomery County and Andy Smarick of Queen Anne’s County were appointed by Governor Larry Hogan to fill two seats on the 12-member board vacated by the departures of Charlene M. Dukes, Ed.D. and Donna Hill Staton, Esq., whose terms ended in 2014.

Andy Smarick spoke at the 2013 MACo Winter Conference on alternative education and charter schools. Both appointees have strong backgrounds in education policy and reform.

Dr. Finn is a Senior Fellow at Stanford University’s Hoover Institute, where he is Chairman of the K-12 Education Task Force. He also is president of the Thomas B. Fordham Institute, where his primary focus is reforming primary and secondary schooling. Dr. Finn has led Fordham since 1997 after many roles in education, academe and government, including professor of education and public policy at Vanderbilt University. He also served as an assistant secretary at the U.S. Department of Education and was legislative director for U.S. Senator Daniel Patrick Moynihan.

Mr. Smarick is a partner at Bellwether Education Partners, a national nonprofit dedicated to helping education organizations – in the public, private, and nonprofit sectors – become more effective in their work and achieve dramatic results for students. He served as a deputy assistant secretary at the U.S. Department of Education and an education aide at The White House Domestic Policy Council. Mr. Smarick also helped launch a college-preparatory charter school for under-served students in Annapolis and was a member of Gov. Robert Ehrlich’s Commission on Quality Education.

For more information, read the press release from the Maryland State Department of Education here, and our previous posts, Maryland’s Governor-elect Could Alter State Education Board Membership, and MACo Features Innovations in Education at Winter Conference.

Test Results Bode Well For Biosolid Composting Collaboration Between Anne Arundel County & Baltimore City

The Spring 2015 Edition of Waste Watch, published by the Northeast Maryland Waste Disposal Authority, reported that the successful conclusion of a pilot project on biosolid recycling in Anne Arundel County may result in an ongoing collaboration between the County’s Cox Creek Water Reclamation Facility (WRF) and the Baltimore City Compost Facility. From the article:

The pilot project was designed to study the feasibility of Anne Arundel County utilizing the City Compost Facility to process biosolids produced during the wastewater treatment process. It was inspired by the fact that a portion of the County’s biosolids have long been transported out of state, where it is land-applied for agricultural use. Maryland regulations regarding application and storage of nutrients have been tightening, resulting in a restriction of land application activities in Maryland to certain seasons.

With this issue in mind, the Authority, while negotiating a 2013 contract extension with Veolia North America (owner and operator of the Baltimore City Compost Facility), also negotiated an agreement for the Facility to accept and process biosolids from other Authority Jurisdictions. Veolia accepted the agreement based on the prerequisite that processing biosolids from other jurisdictions would not interfere with its ability to process biosolids from Baltimore City’s Back River Wastewater Treatment Plant (WTP). …

The Authority is working with Anne Arundel County to explore the economic feasibility of a more permanent arrangement for processing solids at the Baltimore City Compost Facility. This collaboration has the potential to be a winning proposition for Veolia, Anne Arundel County, and the City of Baltimore.


Climate Change Mitigation Working Group Underway

The Maryland Commission on Climate Change, which is housed within the Maryland Department of the Environment (MDE) has launched several working groups to handle different aspects of climate change, including adaptation, mitigation, and public outreach. The Mitigation Working Group will recommend strategies to help the State reduce its greenhouse gas emissions by 25% of 2006 levels by 2020, as required under Maryland’s Greenhouse Gas Reduction Plan.

The Mitigation Working Group is composed stakeholders representing the State, environmental community, commercial builders, energy sector, research institutions, labor, and local governments.  MACo Legal and Policy Director Les Knapp is a county government representative.  The Working Group held its first meeting on May 6 which was primarily organizational in nature. It met again on May 21, where it heard about greenhouse gas reduction efforts by Department of Natural Resources and the Maryland Energy Administration.  The Workgroup plans to have its recommendations and report to the Commission finalized by mid-August.

In addition to the general meetings, the Working Group will also be holding a series of subgroup meetings to look at topics more in-depth.  These include meetings on energy (May 28 from 1:00 PM – 3:00 PM at MDE) and transportation/land use (mid-June, location to be determined).  Other possible subgroup meetings could review the climate change strategies economic impact analysis, lead by example programs, local initiatives, and college action plans.

If you want more information about the Mitigation Working Group, please contact Les Knapp at 410.269.0043 or  You may also submit comments to the Commission at



State Works To Review Criminal Justice System

In an interview with The Afro-American, Chris Shank, Director of the Governor’s Office of Crime Control and Prevention (GOCCP) discussed the  Justice Reinvestment Coordinating Council (JRCC)  which will use a data-driven approach to develop a statewide criminal justice framework to reduce incarcerations, recidivism and their associated costs, while increasing public safety. As reported in The Afro-American:

If Maryland is going to reduce recidivism, not to mention the costs associated with our criminal justice system, then the state needs a complete and data-driven picture of how that system operates. Senate Bill 602 requires the JRCC to request technical assistance from the Council of State Governments Justice Center and the Public Performance Safety Project of the Pew Center on the States for the purposes of analyzing our system and developing the Justice Reinvestment Coordinating Council’s policy recommendations, which are due to the governor on or before Dec. 31.

“What my goal to produce [for] Gov. Hogan and to the state of Maryland, in terms of this whole process, is, for the first time, a holistic, critical examination of our criminal justice system. Who’s doing what in that criminal justice system, and how efficiently are we doing it, and how can we do it better? Once we have that analysis, then we have an opportunity to look at cost savings, but then we also have an opportunity to reduce the recidivism rate. And that provides a more safe society, a more just society,” said Shank.

For more information read the full article in The Afro-American.

Did EPA Help Generate Positive Public Comments on Waters of the US Rule?

A lengthy May 18 New York Times article reported on allegations that the United States Environmental Protection Agency (EPA) may have helped manufacture many of the public comments in support of its controversial change to definition of “waters of the United States” under the federal Clean Water Act.  As previously reported on Conduit Street, the United States Environmental Protection Agency (EPA) and United States Army Corps of Engineers are moving to finalize the  proposed rule despite: (1) concerns raised by MACo, the National Association of Counties, and numerous other stakeholders; and (2) legislation that is moving through Congress to restart the rule making process.

From the article:

Gina McCarthy, the agency’s administrator, told a Senate committee in March that the agency had received more than one million comments, and nearly 90 percent favored the agency’s proposal. Ms. McCarthy is expected to cite those comments to justify the final rule, which the agency plans to unveil this week.

But critics say there is a reason for the overwhelming result: The E.P.A. had a hand in manufacturing it.

In a campaign that tests the limits of federal lobbying law, the agency orchestrated a drive to counter political opposition from Republicans and enlist public support in concert with liberal environmental groups and a grass-roots organization aligned with President Obama. …

The E.P.A.’s campaign highlights the tension between exploiting emerging technologies while trying to abide by laws written for another age.

The article noted that while federal agency leadership can promote proposed policies and support or oppose legislation on behalf of their agency , legal opinions from the Justice Department prohibit agencies from substantial “grass-roots” lobbying that targets the general public or a segment of the general public and urges them to communicate a particular point of view to the government.  EPA’s use of social media and coordination with environmental organizations in support of proposed rule may have violated this prohibition.

Late last year, the E.P.A. sponsored a drive on Facebook and Twitter to promote its proposed clean water rule in conjunction with the Sierra Club. At the same time, Organizing for Action, a grass-roots group with deep ties to Mr. Obama, was also pushing the rule. They urged the public to flood the agency with positive comments to counter opposition from farming and industry groups.

The results were then offered as proof that the proposal was popular. …

The most contentious part of the E.P.A.’s campaign was deploying Thunderclap, a social media tool that spread the agency’s message to hundreds of thousands of people — a “virtual flash mob,” in the words of Travis Loop, the head of communications for E.P.A.’s water division.

The architect of the E.P.A.’s new public outreach strategy is Thomas Reynolds, a former Obama campaign aide who was appointed in 2013 as an associate administrator. “We are just borrowing new methods that have proven themselves as being effective,” he said.

But industry critics said the agency’s actions might be violating federal lobbying laws.

While critics questioned EPA’s actions, EPA denied any wrongdoing:

At minimum, the actions of the agency are highly unusual. “The agency is supposed to be more of an honest broker, not a partisan advocate in this process,” said Jeffrey W. Lubbers, a professor of practice in administrative law at the American University Washington College of Law and the author of the book “A Guide to Federal Agency Rulemaking.”

“I have not seen before from a federal agency this stark of an effort to generate endorsements of a proposal during the open comment period,” he said. …

“The agency has relentlessly campaigned for the rule with tweets and blogs, not informing the public about the rule but influencing the public to advocate for the rule,” said Ellen Steen, general counsel at the American Farm Bureau Federation. “That is exactly what the Anti-Lobbying Act is meant to prevent.” …

“E.P.A. Office of Water’s Twitter account has essentially become a lobbyist for the proposal,” wrote Kevin P. Kelly, chairman of the National Association of Home Builders, in a letter to the E.P.A. protesting the role the agency has played in advocating its clean water proposal. …

Officials at the E.P.A. strongly defend their work — insisting that they did not violate the Anti-Lobbying Law because they never explicitly urged the public to lobby Congress, just to express their support for the plan in a public way.

“We are well within our authority to educate the American people about the importance of what E.P.A. is doing to act on climate change and protect public health,” Mr. Reynolds said. “There is a very clear line, and we never, ever cross it.”

United States Attorney General Opinion on Federal Agency Grass Roots Lobbying

Planning and Public Input Key Factors For Transit-Oriented Development & Rail Projects

A May 20 Sustainable Cities Network article examined the factors that led to successful transit oriented development (TOD) and light rail projects in areas such as Denver, Atlanta, and Charlotte, and concluded that early planning are citizen input are critical components.  Excerpts from the article are presented below:

Denver, Colorado, West Colfax W Line Project

The W  Line connects Denver’s West Colfax neighborhood with the rail line’s mixed use Union Station hub.

Two major themes are echoed by transportation professionals working with communities on bringing mass transit to their neighborhoods: the need for 1) forethought and 2) cooperation. Scott Reed, Denver Regional Transportation District’s (RTD) assistant general manager of Communications, discussed both.

“One of the main things,” he said, “is a long lead time in the planning process. We found that having a more integrated approach where we dovetail our planning with municipalities and communities and in turn seek partnerships with the development community to take a look at and participate actively in planning and zoning processes can result in the best possible community centered around access to transit.”

Atlanta, Georgia, Atlanta BeltLine Project

The Atlanta BeltLine project will connect dozens of neighborhoods (some isolated and historically segregated) around a 22-mile transit, trail, and park corridor surrounding downtown Atlanta by 2030.  The corridor will replace an old rail system.

“We were mandated legislatively to have a community engagement framework,” Atlanta Beltline Inc. Communications and Media Relations Manager Jenny Odom said. “So what we did over the course of some years is broke the BeltLine into 10 sub-areas and went to each area and worked with each community, specifically about things they would like to see in their neighborhood. We developed 10 sub-area master plans, all adopted by city council. We’re now working on a unified plan to bring elements together.” …

“For the most part, the railroad was a dividing line between neighborhoods,” Odom said. “So to have this reunification of these different types of neighborhoods as [old rail] tracks come out, these neighborhoods all of a sudden coming together across socioeconomic lines, is really powerful.”

The BeltLine master plan also has an affordable housing component that requires more than 5,500 units of affordable housing in the vicinity of the project funded via tax allocation district bonds. While not quite 1,000 units have been developed, Odom said the city is working on a plan to pick up the pace.

Charlotte, North Carolina, Charlotte Area Transit System (CATS)

CATS oversees transit throughout the City of Charlotte, including bus and light rail systems.

According to CATS Public and Community Relations Manager Krystel Green, [the transit system’s 5-year bus service plan]includes “intensive community education and feedback that engages residents, neighborhoods, businesses and employers. … With each plan, we engage the community and get citizen feedback. It is important to CATS to work with citizens and understand how their lives will be impacted.”

The city of Charlotte extends similar principles to its work with the community on its light rail which is in the process of adding an extension that runs through several residential areas. “CATS does a great deal of work with citizens in the beginning stages … to collect their feedback,” Green said. The city even has an “Art-In-Transit” team that has partnered with neighborhood schools, with children providing pictures, poems and prose that will be incorporated in station designs.


Washington County Commissioners Praise County’s First Single-Stream Recycling Center

A May 14 Herald Mail article reported that the Washington County Board of County Commissioners held a ribbon cutting ceremony to officially acknowledge and praise the Apple Valley Recycling Center.  The facility is the County’s first single-stream recycling center and opened in September of 2014.

“I’m very happy to have Apple Valley Waste locate here in Washington County,” county Commissioner Jeffrey A. Cline said. “The enthusiasm, the willingness to work and to hire people is important, but recycling is the right thing to do. I’m very proud to have a company like Apple Valley Waste here to help us with that.” …

John Decker, managing partner and chief executive officer of Apple Valley Waste, credited the efforts of county agencies with helping to obtain permits and get the project under way, allowing for more locally collected recylables to stay here while diverting waste from county landfills.

“Most of the material from this market was making a trip all the way to Baltimore to be processed, including ours,” Decker said. “The economics of that weren’t very good. The environment impact of that wasn’t very good. So we saw an opportunity to process material right here locally, help the economic situation, really help the environmental situation.”

The article noted that the center processes an average of 20 to 25 truckloads of waste material daily and employs more than 30 employees.

MDE Secretary Seeks to Improve Customer Service & Be More Business Friendly

A May 20 Daily Record article reported that Secretary of the Environment Ben Grumbles plans to improve the Maryland Department of the Environment’s (MDE’s) customer service and perception among the business community while still furthering the State’s environmental goals.

New Md. environmental chief: Enforcement not ‘first step’

Ben Grumbles (Source: The Daily Record/Maximilian Franz)

From the article:

Ben Grumbles, Gov. Larry Hogan’s choice to lead the environmental agency, said his challenge will be to “accelerate the pace of environmental progress in Maryland,” including improving the health of the Chesapeake Bay, even as he attempts to improve the perception that his agency contributes significantly to what is seen as an unfriendly business climate in the state.

“The customer isn’t always right, the customer service is always right,” Grumbles said. “An environmental regulatory agency has to say ‘no’ at times. The key to customer service is to communicate clearly and effectively early on and to try to be a problem solver. If you’re going to say ‘no,’ try to say why and also explain what might change that ‘no’ to a ‘maybe’ or to a ‘yes.’” …

The article noted that the relationship between MDE and the business community was criticized during hearings held in 2014 by the Maryland Economic Development and Business Climate Commission (also known as the Augustine Commission):

The commission reported that complaints ranged from difficulties in dealing directly with the agency, including “frustrating, confrontational, inconsistent, time-consuming, arbitrary, and generally unhelpful” interactions; refusals to grant “common sense” exemptions; delays in decisions; refusals to explain decisions; and excessive uses of penalties and other legal actions.

Grumbles explained in the article that he will be to provide the public and businesses with more information through MDE’s website and create  an ombudsman to help businesses comply with environmental regulations. Grumbles also stressed that enforcement should not be MDE’s first option:

Enforcement will still be part of the equation, but Grumbles said it shouldn’t be the first option.

“Enforcement is not a necessary evil,” Grumbles said. “It’s a necessary backstop.”

The first goal should be to provide compliance assistance, he said.