Kirwan Blueprint Funding: The Ins, Outs, What-Have-Yous

The much-heralded Kirwan Blueprint bill, passed this session, establishes new funding incentives for teachers and education – but will it definitely happen?

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As “The Dude” says… it’s “very complicated”

SB 1030 is among the most-discussed bill to pass during the 2019 session – it’s the “Blueprint for Maryland’s Future” and starts the move toward rethinking the statewide commitment to public education. While most discussion has focused on the bill in the past tense, there’s still an unclear future for its immediate effects.

So, for counties busily assembling and contemplating their FY 2020 budgets, especially those seeking to meet the 3% teacher salary increase requirement to qualify for extra state funding, what are the remaining pieces to fall into place?

Will the Governor Veto the Bill?

At one point during the session, Governor Hogan held court before the press and discussed his concerns with the not-yet-complete school legislation pending (see Conduit Street coverage) citing worries over both costs and its lack of “accountability” measures. Since then, the General Assembly winnowed down some of the cost components, and added substantial blocks of the Governor’s own accountability proposals, including the creation of an Inspector General position.

The Governor has three options, under the constitution, since the General Assembly is no longer in session: sign the bill into law, let it become law without his signature, or veto it.

In the event of a veto, what happens? Looking at the lopsided margins of support in the General Assembly (including a unanimous vote in the Senate to accept the final House amendments and send the bill to the Governor), an override of the veto seems likely. Because the bill has an effect on the budget year currently being debated, it also seems likely that an expedited override would happen, to give clarity to counties and schools for this year’s budget planning.

So – a veto may not be the most major unknown. All three possible scenarios potentially lead to the same outcome, the bill going into effect as planned.

That leads to the next, and more substantial unknown…

Will the Governor Provide the State Funding for This Year?

This is the central matter. Under the Maryland Constitution, only the Governor may place funds into the operating budget to be spent. The General Assembly may, by law, require the Governor to fund certain items in future years’ budgets (so-called “mandated appropriations,” a common political buzzword) but may not add funds to the budget being proposed, nor may they move funds from one item to another. In other words, the FY 2020 funding in SB 1030 is all subject to the Governor providing it through a process of budget amendments.

From the SB 1030 fiscal note comes a full treatment of this issue:

Fiscal 2020 State Operating Budget

Approximately $255.0 million is made available through separate legislation to implement this bill in fiscal 2020, contingent on enactment of this bill. Specifically, Section 47 of the State operating budget for fiscal 2020 (House Bill 100 of 2019) restricts $100.8 million in Education Trust Fund (ETF) lockbox funds to specific purposes under this bill. It also expresses legislative intent that the Governor process a budget amendment to appropriate $134.5 million for the purposes of this bill. In addition, the Budget Reconciliation and Financing Act of 2019 (House Bill 1407), in conjunction with the budget bill, authorizes the Governor to appropriate, in fiscal 2020, specifically for special education grants under this bill: $15.8 million in additional ETF revenues received due to the repeal of certain video lottery facility provisions of law; and $4.0 million in general funds that would otherwise be used for the Teacher Induction, Retention, and Advancement Pilot Program.

So… in multiple ways, the Blueprint bill (when coupled with other legislation passed and referenced in the bill) creates an opening for the Governor to direct certain funds to these purposes. In other words, his doing so would not upend the balanced fiscal plan for FY 2020.

However, the Governor may decide not to follow through on these initiatives.

In that case, SB 1030 could go into effect, but the funding provisions would not take effect until FY 2021, where the legislation mandates the spending. This leaves the FY 2020 spending in the same situation as some of the increased funds committed for school construction – see previous Conduit Street coverage, “Substantial School Construction Funding Left to Governor’s Discretion.”

In particular, this leaves the $75 million incentive for counties to fund a 3% teacher salary increase in the balance. A definitive statement from the Governor could clear this matter, but until such word is announced, counties and school boards are working toward their budget plan with a looming degree of uncertainty about the first year of this three-year plan.

 

Michael Sanderson

Executive Director Maryland Association of Counties
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