Final Fiscal 2015 Budget Actions Adopted – Local Government Summary

The Senate and House adopted the joint budget conference committee report on the floor this morning, finalizing the General Assembly’s actions on the fiscal 2015 budget. The $38.8 million budget reduces the structural budget gap, avoids reductions to essential programs, and maintains the State’s commitment to education. The budget grows by 4.3% over the fiscal 2014 working appropriation.

Aid to Local Governments increases by 2.7%, with the greatest dollar increase in funding going to education and libraries, $189.5 million.  Local health department funding increases by $5.1 million, 11.1%; and community college funding increases by $16 million, 5.7%. Funds allocated to counties and municipalities decrease by $5.6 million, or 1%.

Now that conference committee documents are available, MACo is providing more information on specific actions affecting local governments.

TRANSPORTATION – The conference committee agreed to appropriate a one-time grant of $10 million in fiscal 2014 to county governments, including Baltimore City, for pothole repairs.  This funding was provided in the Governor’s supplemental budget.  The Senate budget plan provided $10 million to county governments for pothole repairs in fiscal 2015. The Appropriations Committee took action to accelerate the $10 million in pothole funding for counties and Baltimore City into fiscal 2014 and received a letter from Maryland Department of Transportation Secretary in support of this approach.

COMMUNITY COLLEGES – The conference committee agreed to the House language, which modifies the percentage of per student funding in the community college funding formula. This modification still constrains formula growth, but provides a funding increase of 5.7%.  The Senate budget plan provided a funding increase of 5.2% and the Governor’s proposed budget provided an increase of 5.0%.

The conference committee also agreed to the House language which requires a county to maintain or exceed its total community college appropriation in a given year to receive an increase in State support or funding from the hold harmless grant.

LOCAL HEALTH DEPARTMENTS – The House and Senate adopted language clarifying that inflationary increases for local health departments are applied to the prior year appropriation providing for cumulative growth in the formula, instead of being applied to the base funding level (additional information on this issue can be found in a previous post on Conduit Street).  The House and Senate agreed to this language prior to conference committee.

EDUCATION FUNDING – The House and Senate adopted language to clarify that, for the purpose of local education maintenance of effort requirements, the wealth per pupil is calculated using September 1 net taxable income for fiscal 2015 through 2017; beginning in fiscal 2018, November 1 net taxable income will be used. The House and Senate agreed to this language prior to conference committee.

Budget conferees also approved budget narrative directing the Maryland State Department of Education to compile and submit information on the “nonrecurring costs” process allowing counties to make one-time investments in school budgets without those funds being built into the state’s permanent funding requirements.

STATE DEPARTMENT OF ASSESSMENTS AND TAXATION – The conference committee adopted language requiring the State Department of Assessments and Taxation (SDAT) to establish a workgroup to study issues related to property assessments and the calculation and administration of tax credits and exemptions; and authorize the agency to procure auditing assistance. The conference committee rejected language that was adopted by the House to specify which job functions new assessors in Baltimore City should be assigned and for SDAT to consider entering into agreements with individual counties or Baltimore City to provide funds to SDAT to hire additional personnel.

COMPTROLLER V. BRIAN WYNNE CASE – The conference committee agreed to language adopted by the House to establish the rate of interest to be paid for income tax refunds resulting from the case to the average prime rate.

BAIL REFORM – The conference committee adopted language establishing that the costs for attorneys appointed to implement the DeWolfe v. Richmond beyond the amount specified in the budget are to be billed to the county in which representation is provided.

STORMWATER FEE – The conference committee adopted language authorizing the Maryland Department of Environment to enter into a memorandum of understanding with Carroll and Frederick counties to establish an alternative source of revenue to be used to implement local watershed implementation plans.  Additional information can be found on Conduit Street.

ELECTIONS – The conference committee adopted language restricting funds of the State Board of Elections until a report is submitted on voter wait times and agreed to provide $549,000 in the budget to be used in the development of the new optical scan voting system.  The supplemental budget included these funds, but the Department of Legislative Services recommended that the funds be reduced and the costs shifted to the counties. The Conference Committee rejected this recommendation.