DLS Aid Overview: Up This Year, But Still Behind

The Department of Legislative Services has prepared its Overview of State Aid to Local Governments, a document analyzing and summarizing these elements of the Governor’s FY 2014 proposed budget. the 48 page report presents a through and useful assembly of current and historic information on the state’s various programs supporting local government services.

Some highlights from the report, for the county audience:

Local Governments – Up in FY 14, but far below former levels. The category of Counties/Municipalities has suffered deep cuts due to Highway User Diversions, and cutbacks to police aid, program open space, and other programs. That category (funding for local governments, as separated out from education and other external county-supported functions) peaked in FY 2009 at just over $950 million, but has scaled dramatically back to $457 million in FY 2013 — less than half the previous support.

Local Highway User Revenues Still A Fraction of Longstanding Formula. The analysis shows the local distribution of highway user revenues, historically set by law at 30%, now totaling less than 10%.HUR graph The following page shows the distributions by county (including municipal shares in each for simplicity) for FY 2007 and FY 2013-14… with the alarming loss of funds for nearly every jurisdiction hovering around 90% of former funding levels.

Funding for Schools Dwarfs Everything Else Labeled as “Aid.” The DLS analysis notes that funding for education remains the largest are of aid – both in terms of total funding and of recent increases. Public schools received 69% of total aid in FY 2004, but that share has grown to over 74% for the proposed FY 14 budget.

Disparity grant distortion worsens. The analysis of the state-funded disparity grant program reveals that it continues to miss its intended purpose, due to a budget-driven cap in its formula. Multiple counties, whose income tax yield would ordinarily show greater disparities triggering state grant funding, are left short or completely unfunded by the statutory cap.

Read the full Overview of State Aid to Local Governments document online.

Michael Sanderson

Executive Director Maryland Association of Counties

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