Governor to Fund Pension System, Not Education With Set Aside Funds

Governor Larry Hogan announced yesterday that he would not allocate the $68 million that the General Assembly set aside for education in the fiscal 2016 budget to fully fund the Geographic Cost of Education Index (GCEI). Instead, he stated that he would put the money in the State pension system to address its unfunded liability.

From the Governor’s press release,

“We have taken steps to grow education funding, but the state still faces $18.7 billion in unfunded pension liabilities, following $625 million in cuts to pension contributions in the last few years. To address this situation, I’ve decided not to follow the General Assembly’s recommendation to raid the pension fund,” said Governor Hogan. “Doing so would be shortsighted and irresponsible, and I was elected to end this very type of reckless budgeting and governing.”

General Assembly leaders, local officials, and education advocates expressed disappointment with his decision. As reported by the Baltimore Sun,

[Baltimore City Mayor Stephanie] Rawlings-Blake said she was “disheartened” by Hogan’s decision. Baltimore would have received $11.6 million.

The House speaker told reporters that Hogan’s decision was “disappointing.” Busch said the governor had overruled the will of the majority of the General Assembly, and in doing so alienated the three largest political jurisdictions in the state. Delegations from Baltimore City and Prince George’s and Montgomery counties — which would have seen a total of more than $49 million in additional funding — make up 45 percent of the legislature.

As reported by the Washington Post,

The decision is a particular setback for Prince George’s and Montgomery counties, which would have received $20 million and $17 million in extra money, respectively.

…Senate President Thomas V. Mike Miller Jr. (D-Calvert) called Hogan’s decision a “declaration of war on the children of the state of Maryland.”

Montgomery County Executive Isiah Leggett (D) expressed disappointment with the governor’s announcement. “This is a tremendous need for the county and for the state,” he said.

The Governor also announced during the press conference that he would let SB 183, a bill that would change the GCEI formula from discretionary to mandatory if full funding of GCEI was not provided for in the fiscal 2016 operating budget, take effect without his signature.

As reported by the Baltimore Sun,

He called the legislation an “unreasonable mandate,” but he said he knows the Democratic legislature would override his veto, and it was not worth putting the public through a “protracted fight.”