2015 End of Session Wrap Up: Education Funding

This post summarizes the status of education funding bills relevant to Maryland counties in the 2015 Regular Session.

Maintenance of EffortHB 65/SB 224 Education – Maintenance of Effort – Lease Payment Exclusion; HB 1079/SB 627 Education – Maintenance of Effort Requirement – Alterations; HB 502 State Department of Education – Financial Advisory Board – Establishment

HB 65/SB 224  authorizes county governing bodies to exclude lease payments for school facilities from the maintenance of effort calculation.

MACo supported this bill as a way to bring alternative financing laws in line with traditional school construction financing.  The legislation would account for time-limited lease payments on school facilities outside of annual budget requirements, the same way that debt service is accounted for in traditional school construction  financing.

MACo testimony on the bill

FINAL STATUS: The bill was incorporated into SB 627 as a study, however despite the unanimous passage of SB 627 by the Senate Budget and Taxation Committee and the full Senate, it was not taken up by the House Ways and Means Committee.

HB 1079/SB 627 in its original form removed the requirement that the maintenance of effort amount increase by a specified amount under specified circumstances, requires county governing bodies to exclude the cost of a fixed term lease for a specified school facility from the maintenance of effort calculation under specified circumstances and prohibits specified appropriations not excluded as specified nonrecurring costs from being included in calculating a county’s highest local appropriation under specified circumstances.

This bill was a MACo Initiative.  MACo’s support for the amended legislation stated that the bill would make a needed clarification of exclusions to maintenance of effort law and would resolve additional issues with maintenance of effort through an interim study.

MACo Testimony on SB 627 as amended

FINAL STATUS: The bill failed. Despite the unanimous passage of SB 627 by the Senate Budget and Taxation Committee and the full Senate, it was not taken up by the House Ways and Means Committee.

HB 502 establishes the Financial Advisory Board within the State Department of Education to assist the State Superintendent in making preliminary assessments of maintenance of effort waiver requests.

MACo supported this bill, stating that counties have long advocated for a more independent voice in this financial analysis of waiver requests, and that HB 502 represented a positive step in that direction.

MACo testimony on HB502

FINAL STATUS: The bill failed. The bill had a smooth hearing in the House Ways and Means Committee but was not discussed or voted by the Ways and Means Education Subcommittee. 

GCEI: SB 183 / HB 215 mandates the Geographic Cost of Education Index (GCEI) grant program, which is currently a discretionary program that may be funded in the Governor’s budget.  The GCEI funding formula provides additional state funding to some counties based on regional differences in the cost of education. The final version of the legislation provided that if full GCEI grant funding is provided in FY 2016, then the mandate is voided.

MACo did not testify on this legislation which provides additional funding to some, but not all county governments.

Fiscal note on SB 183

FINAL STATUS: SB 183 passed the General Assembly , but it’s unclear whether GCEI will be fully funded in FY 2016. The Governor’s budget only funded GCEI at 50%, however the General Assembly fenced off an additional $68.1 million to be used to fully fund GCEI. If the Governor does not do so, the fenced off funds cannot be used for any other purpose.

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