County Budgets

Conduit Street Podcast: Live at #MACoCon with Congressman Dutch Ruppersberger

Kevin Kinnally County Budgets, County News, Elections, Finance and Procurement, Information Technology, News You Can Use, Summer Conference

On the latest episode of the Conduit Street Podcast, Michael Sanderson and Kevin Kinnally are joined by Congressman Dutch Ruppersberger for a live recording at MACo’s Summer Conference in Ocean City, Maryland. Listen in to hear about how Congressman Ruppersberger’s experience in local government affect his decision-making on Capitol Hill, the importance of municipal bonds, an update on election security, and more!

Listen here:

MACo has made the podcast available through both iTunes and Google Play Music by searching Conduit Street Podcast. You can also listen on our Conduit Street blog with a recap and link to the podcast.

You can listen to previous episodes of the Conduit Street Podcast on our website.

Congressman C.A. Dutch Ruppersberger is serving his eighth term in the United States House of Representatives for the citizens of Maryland’s 2nd District. Maryland’s 2nd District includes parts of Baltimore City as well as Baltimore, Anne Arundel, Harford and Howard Counties.

Representative Ruppersberger, who served as MACo President in 1996 while in office as Baltimore County Executive, has served in public office for more than 30 years. He was elected to the Baltimore County Council in 1985 and again in 1989, chosen twice as council chairman. He was elected Baltimore County Executive in 1994 and 1998, and, under his leadership, the county was named one of the nation’s four best-managed counties by Governing Magazine.

Known as a consensus builder on Capitol Hill, Ruppersberger has led the fight to protect tax-exempt municipal bonds, the most important tool in the United States for financing state and local infrastructure including schools, hospitals, water, sewer facilities, public power utilities, roads, and mass transit.

Education Funding Hot Topic at #MACoCon

Kevin Kinnally County Budgets, County News, Education, MACo Events, Summer Conference
Dr. William “Brit” Kirwan

The [Kirwan] Commission on Innovation and Excellence in Education was formed in 2016 to answer two questions: Should the state revise current education funding formulas? And what major new education policies must be enacted to put Maryland public schools on par with the best in the world? The Commission released preliminary policy recommendations earlier this year, and has recently sharpened its focus on education formulas — including the pattern and role of county funding.

During the 2018 MACo Summer Conference panel “Angling for Educational Excellence: Kirwan 2.0” attendees heard an update on the Commission’s work, as well as a timeline for its final recommendations.

Dr. William “Brit” Kirwan, Chair, Commission on Innovation and Excellence in Education, began the session by providing an overview of the Commission, its preliminary recommendations, the status of the Commission’s four working groups, and a timeline for its final report. Dr. Kirwan also stressed the need for a strong system of governance and accountability to oversee the implementation of its recommendations.

Craig Rice, Montgomery County Councilmember

Craig Rice, Montgomery County Councilmember and MACo appointee to the Kirwan Commission, discussed early childhood education, including pre-kindergarten. Councilmember Rice also emphasized MACo’s position that any recommendations made by the Commission be fair and equitable to all twenty-four jurisdictions, and that no recommendations result in a “winners and losers” situation for Maryland’s counties.

Allegany County Commissioner and MACo appointee to the Kirwan Commission, William Valentine, discussed the Commission’s goal of eliminating the gap in compensation between teachers and high-status professions that require comparable levels of education. Commissioner Valentine also explained the Commission’s plan for expanding access to Career and Technical Education (CTE) pathways.

The session was moderated by Delegate Maggie McIntosh and was held on Saturday, August 18. The 2018 MACo Summer Conference was August 15-18, 2018 at the Roland Powell Convention Center in Ocean City, MD. This year’s theme was “Water, Water Everywhere.”

Revenue Forecasters Share Tricks to Their Trade at #MACoCon

Barbara Zektick County Budgets, County News, State Budget and Fiscal Issues, Summer Conference, Taxes and Revenues

County revenues generally come from property and income taxes – but how much should an administrator, elected official or budget officer expect to receive each year? This question has become increasingly difficult as counties still recover from the Great Recession, tax reform leads to uncertainty, and growth trends shift with an aging population and changing income sources. Even the State has modified its revenue projection processes, accounting for increased volatility. What’s a county to do?

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Andrew Schaufele, Director of Bureau of the Revenue Estimates: when more tax revenue comes from the top 1%, as it has, revenues become harder to estimate
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MACo Summer Conference attendees learned how state revenue estimators and county budget officers predict the future in unpredictable environments at the session, “Navigating Murky Waters: Predicting Unpredictable Revenue Streams,” on Friday, August 17, 2018 at 2:15 pm.

The session began with Andrew Schaufele, Director of Bureau of the Revenue Estimates from the State Comptroller’s Office showing how his office anticipates state revenues during volatile times, and how he provides counties valuable information about county income tax revenues.

He spoke at length about the structural change that occurred to our economy after the Great Recession – and how his office quickly had to adjust its revenue estimating models to accommodate for this permanent change.

John Hammond, longtime Budget Officer for Anne Arundel County showed how he uses his magical crystal ball to inform county officials about how much revenue they can expect to receive in future years. He stressed the importance of maintaining a reserve fund balance to guard against volatility, and applying one-time revenue sources to capital expenditures, rather than operating.

Finally, Jonathan R. Seeman, Director, Budget, Finance & Information Technology, Queen Anne’s County provided perspective on how smaller counties must provide revenue projections with limited resources. He demonstrated how Eastern Shore counties experience some of the most volatile income tax receipts in the state- and why the November distribution of local income taxes is so important.

The session was moderated by The Honorable Kevin Hornberger of Maryland House of Delegates.

MACo’s 2018 Summer Conference was held August 15-18 at the Roland Powell Convention Center, in Ocean City, MD.

Dr. Kirwan Discusses His Commission’s Work on WYPR

Kevin Kinnally County Budgets, County News, Education, Summer Conference

Dr. William “Brit” Kirwan, Chair of the [Kirwan] Commission on Innovation and Excellence in Education, yesterday joined WYPR’s On the Record to discuss the future of Maryland’s public education system.

The Commission is charged with reviewing and assessing current education financing formulas and accountability measures. The Commission was originally set to complete its work in time for the 2018 session of the General Assembly, but last October asked for an extension when it became clear the deadline was not realistic. Prior to breaking for the 2018 legislative session, the Commission released a preliminary report detailing its preliminary recommendations.

When asked about the delay, Dr. Kirwan explained that the initial timeline was simply impractical. “I don’t think anybody fully appreciates the magnitude of this challenge. We are being asked to invent and develop a funding formula for an entirely new system of education, that will be at the level of the best-performing systems in the world. We’re supposed to do that in six months? Give me a break!”

Dr. Kirwan expects the Commission to release its final recommendations in time for the 2019 session of the Maryland General Assembly.

In the meantime, the Commission’s four working groups will continue working to develop a consensus on the design, implementation plan, and cost for each of the preliminary recommendations. Once the working groups have completed their work, they will present their recommendations and cost estimates to the full Commission. The chair will work with staff and consultants to develop a draft cost estimate based on the recommendations of the working groups (as considered by the full Commission) for the full Commission’s consideration.

Dr. Kirwan cautioned that simply spending more money on Maryland’s public education system is unlikely to improve student outcomes. “It’s not just how much you spend, it’s what you spend it on. That is part and parcel to the recommendations we’re making,” Kirwan said.

Greater spending must come with greater accountability, according to Chair Kirwan. “There is inadequate accountability, and that’s what we’re trying to address,” he said.

Chair Kirwan said he looks forward to working with Governor Larry Hogan and the Maryland General Assembly on legislation to implement the Commission’s recommendations. “I give Governor Hogan and the Legislature a lot of credit for appointing this commission because they recognize that Maryland’s future and the future well-being of our citizens depend upon a high-quality education, that’s the future of our economy.”

The 2016 Commission on Innovation and Excellence in Education was created by legislation introduced in the General Assembly. The Commission membership parallels that of the earlier Thornton Commission.

MACo advocates for adequate, fair, and reasonable funding for all of Maryland’s students, and urges State policymakers to sustain a robust level of public education and school construction funding.

Useful Links

WYPR Coverage

Previous Conduit Street Coverage

MACo’s Summer Conference will include a session on education funding and accountability, and how to best ensure that Maryland students receive a fair, equitable, and high-quality education. The session, “Angling for Educational Excellence: Kirwan 2.0,” is scheduled for 10:15 am – 11:15 am on Saturday, August 18, 2018.

The 2018 MACo Summer Conference will be held August 15-18 at the Roland Powell Convention Center in Ocean City, Maryland. This year’s theme is “Water, Water Everywhere.”

Learn more about MACo’s Summer Conference:

Everything You Ever Wanted to Know About…

Barbara Zektick County Budgets, County News, Finance and Procurement, News You Can Use, Taxes and Revenues

…tax liens!

Learn it, right here in Maryland, this fall!

The National Tax Lien Association (NTLA) is holding its annual conference for tax collectors, lien purchasers, and mere lien aficionados at the The Gaylord Resort & Convention Center in National Harbor on Wednesday, October 24 and Thursday, October 25, 2018.

And, since this target audience likely minds their wallets, there is an early bird discount for those who register before the end of August.

Click here to register.

Not yet a tax lien aficionado, but would like to be? NTLA hosts its National Tax Lien Association Academy right before the conference gets into gear, on Monday, October 22 and Tuesday, October 23, also at National Harbor. ntla

Click here to learn everything you ever wanted to know about tax sales and tax lien investing.

NTLA was founded in 1997 as a non-profit professional trade organization for the tax lien industry. It represents investors, lenders, service providers, and government officials in regards to tax lien sales, as well as promoting the benefit of those sales as reliable income for county budgets. NTLA provides networking and training opportunities for professionals and novices in the tax lien and tax sale industry.

The process used by counties to collect overdue taxes by sending properties to tax sale has received a lot of attention in the General Assembly of late – particularly as it relates to collection of overdue water bills. The flurry of legislative activity followed the completion of the report of the Task Force to Study Tax Sales in Maryland. Brad Westover, NLTA Executive Director participated actively as a member the task force: providing input that, especially when compared to those in other states, Maryland counties already get this right.

Kirwan Commission Considers Major Pay Increase for Teachers

Kevin Kinnally County Budgets, County News, Education, General Assembly News, Summer Conference

Eliminating the gap in compensation between teachers and high-status professions that require comparable levels of education is a major piece of the [Kirwan] Commission on Innovation and Excellence in Education’s preliminary report. The High-Quality Teachers and Leaders workgroup, one of four workgroups tasked with costing out the Commission’s preliminary recommendations, today discussed a potential model for increasing teacher pay commensurate with advancement on the career ladder.

Maryland Occupations/Salaries: Comparable Occupations List

According to the chart below, teachers in Maryland earn approximately 20% less than professionals working in comparable fields. The workgroup debated adjusting the “comparable profession” salaries to reflect a 10-month work year, which is typical for teachers. While the workgroup ultimately decided against adjusting the numbers, they did remove “Inspectors, Testers, Sorters, Samplers, and Weighers” from the list (the lowest paying comparable occupation), rejecting it as a similar profession.

Framework for Phase-in of Teacher Salary Increases

According to the Commission’s preliminary report, advancement up the ladder should be based on the acquisition of specified knowledge and skills, rigorous evidence of success as a classroom teacher, and/or additional responsibilities commensurate with the additional compensation. The chart below depicts a significant pay increase for teachers who obtain National Board Certification.

Notably, after determining the draft plan would fail to close the compensation gap between teachers and comparable professions, the workgroup asked staff to make a number of changes, including replacing the 10% pay increase in year four with a 40% or 50% pay increase in year four. Commission staff will present cost estimates for the proposed changes at the next meeting.

According to the workgroup, a systematic phase-in of salary increases for teachers (above and beyond cost-of-living adjustments) is necessary in order to stem the decline in teacher recruitment and retention and to begin reducing the gap between compensation levels for teachers and other professions requiring comparable levels of education.

Teacher and staff salaries drive education costs, often making up for more than half of school system budgets. The workgroup acknowledged that raising teacher pay will also result in higher teacher retirement costs and other post-employment benefits. Commission staff will present those fiscal estimates at the next meeting.

The Commission’s four working groups will continue working to develop a consensus on the design, implementation plan, and cost for each of the preliminary recommendations. Once the working groups have completed their work, they will present their recommendations and cost estimates to the full Commission. The chair will work with staff and consultants to develop a draft cost estimate based on the recommendations of the working groups (as considered by the full Commission) for the full Commission’s consideration.

The 2016 Commission on Innovation and Excellence in Education was created by legislation introduced in the General Assembly. The Commission membership parallels that of the earlier Thornton Commission.

The Commission was originally set to complete its work in time for the 2018 session of the General Assembly, but last October asked for an extension when it became clear the deadline was not realistic. Prior to breaking for the 2018 legislative session, the Commission released a preliminary report detailing its preliminary recommendations.

MACo is entitled to two representatives on the Commission, under the legislation. Montgomery County Councilmember Craig Rice, MACo’s Education Subcommittee Chair, and Allegany County Commissioner Bill Valentine, MACo’s Education Subcommittee Vice Chair, represent MACo on the Commission.

Stay tuned to Conduit Street for more information.

Useful Links

2017 Preliminary Report

Previous Conduit Street Coverage

MACo’s Summer Conference will include a session on education funding and accountability, and how to best ensure that Maryland students receive a fair, equitable, and high-quality education. The session, “Angling for Educational Excellence: Kirwan 2.0,” is scheduled for 10:15 am – 11:15 am on Saturday, August 18, 2018.

The 2018 MACo Summer Conference will be held August 15-18 at the Roland Powell Convention Center in Ocean City, Maryland. This year’s theme is “Water, Water Everywhere.”

Learn more about MACo’s Summer Conference:

Whose Water Bill Is It, Anyway?

Barbara Zektick County Budgets, County News, Finance and Procurement, Summer Conference, Transportation and Public Works

Baltimore Sun reporters Ian Duncan and Pamela Wood are digging into an issue that has plagued Baltimore City and Baltimore County for years: who owes what for the ages-old water delivery system that serves the region.

The County is refusing to pay the City’s bill of $23 million – money allegedly owed by the County for the difference between the actual cost to the City to provide water to County residents, and the cost the County bills its residents for that water. The County underbills it residents for the water, and then pays the difference to the City – and currently contests the amount the City is charging.

This issue has been going on for years. From the Sun’s coverage:

In the financial year that ended in summer 2014, the city issued the county a bill of about $4.8 million to make up for customers’ underpayment. Another for just under $15.5 million followed in 2015, and a bill for $2.4 million was issued in 2016. The figure for 2017 was still being calculated at the time the consultants finished writing their report.

The county hasn’t paid any of those bills, the [City’s] consultants reported.

Duncan followed the article with a tweet referencing Moody’s recent rating downgrade of the water system:

Sure enough, last December, Moody’s Investors Services downgraded the City’s senior lien water revenue bonds to Aa3 from Aa2, and its subordinate revenue bonds to A1 from Aa3. This affects nearly $1 billion in rated debt, according to the release. It cites the following reasons:

narrowing coverage levels due to recent revenue losses that breached the total debt service coverage rate covenant in fiscal 2016 and 2017, decreased liquidity to cover revenue shortfalls, and an elevated debt position that will increase given additional capital funding plans.

Moody’s cites as a potential reason to downgrade the ratings further:

Lack of reconciliation with Baltimore County on year-end true up payments[.]

Last session, MACo supported Senate Bill 709/House Bill 923, which helps homeowners avoid going to tax sale over unpaid water bills by giving counties the tools to address the problem long before those bills become overdue. The bill passed both house and was signed by the Governor.

The previous session and over the interim, MACo worked hard to stave off legislation which would have prevented counties from collecting overdue water bills – a move which, without a doubt, would have further undermined billing systems’ bond ratings.

Learn about the flood of water billing legislation and related issues at this year’s MACo Summer Conference, “Water, Water Everywhere,” at the session, Like a Bridge Over Troubled Water: Know Your Water Law.

The MACo Summer Conference will be held August 15-18, 2018 at the Rowland Powell Convention Center in Ocean City, Maryland. Learn more about MACo’s Summer Conference:

 

 

Baltimore Council’s Over Police Going Over on Overtime

Barbara Zektick County Budgets, County News, Employee Benefits and Relations, Public Safety and Corrections

In a move that will only make financial purists crazed, the Baltimore City Council has voted to reject a budget transfer for $21 million to cover police overtime from the previous fiscal year – money that, of course, has already been spent.

The Baltimore Sun quotes Public Safety Committee Chair Brandon Scott:

This is a clear message that the status quo is not going to work anymore.

Last year the Baltimore Police Department spent $47.2 million on overtime. According to the Sun, $16 million was budgeted. From the coverage:

The committee vote comes as leaders on the City Council have announced monthly accountability meetings about the police department, focusing on both the agency’s budget and its crime-fighting strategies.

The city law department also is auditing the Police Department’s overtime, but has yet to make the results of the audit public.

Read the article here.

See the Baltimore Police FY18 budget information here.

Vanderbilt Study: Tennessee Pre-K Program Shows Disappointing Results

Kevin Kinnally County Budgets, County News, Education, State Budget and Fiscal Issues, Summer Conference

Children participating in Tennessee’s Voluntary Pre-K (VPK) program were more likely than those who didn’t attend the program to need special education services and showed higher instances of school rule violations in later grades, according to the latest results of an ongoing study by researchers at Vanderbilt University.

The researchers also found no differences in attendance rates between students who enrolled in the pre-K program and those who didn’t, and that VPK had no effects on attendance and retention in the later grades.

According to the Vanderbilt Study:

The inauspicious findings of the current study offer a cautionary tale about expecting too much from state pre-k programs. The fact that the Head Start Impact study – the only other randomized study of a contemporary publicly funded pre-k program – also found few positive effects after the pre-k year adds further cautions (Puma et al., 2012).

State-funded pre-k is a popular idea, but for the sake of the children and the promise of pre-K, credible evidence that a rather typical state pre-k program is not accomplishing its goals should provoke some reassessment. It is apparent that the phrase “high-quality pre-K” does not convey enough about what the critical elements of a program should be.

Expanding “high-quality” pre-kindergarten for all four-year-olds and low-income three-year-olds is a hallmark of the [Kirwan] Commission on Innovation and Excellence’s preliminary report. As previously reported on Conduit Street, the Early Childhood Education workgroup, one of four workgroups tasked with costing out the Commission’s preliminary recommendations, last week released initial cost estimates for expanding high-quality, full-day pre-K in Maryland — and the numbers are staggering.

According to the workgroup, expanding “high-quality,” full-day pre-K to low-income (300% FPL) three- and four-year-olds in Maryland would cost approximately $1 billion.

The Commission’s four working groups will continue working to develop a consensus on the design, implementation plan, and cost for each of the preliminary recommendations. Once the working groups have completed their work, they will present their recommendations and cost estimates to the full Commission. The chair will work with staff and consultants to develop a draft cost estimate based on the recommendations of the working groups for the full Commission’s consideration.

The 2016 Commission on Innovation and Excellence in Education was created by legislation introduced in the General Assembly. The Commission membership parallels that of the earlier Thornton Commission.

Learn more about the Kirwan Commission and its efforts to ensure that Maryland students receive a fair, equitable, and high-quality education at the MACo Summer Conference session “Angling for Educational Excellence: Kirwan 2.0.” The session will be held from 10:15 -11:15 am on Saturday, August 18.

Speakers:

  • Dr. William “Brit” Kirwan, Chair, Commission on Innovation and Excellence in Education
  • The Honorable Craig Rice, Council Member, Montgomery County
  • The Honorable William Valentine, Commissioner, Allegany County

Moderator: The Honorable Maggie McIntosh, Maryland House of Delegates

The 2018 MACo Summer Conference will be held August 15-18 at the Roland Powell Convention Center in Ocean City, Maryland. This year’s theme is “Water, Water Everywhere.”

Learn more about MACo’s Summer Conference:

Feds Must Show Effects of Unfunded Mandates If This Bill Passes Congress

Robin Clark Eilenberg County Budgets, County News, NACo and Federal Issues, State Budget and Fiscal Issues, Summer Conference

The House of Representatives has passed the Unfunded Mandates Information and Transparency Act (UMITA), but the Senate has yet to act. The National Association of Counties supports the legislation.

The National Association of Counties is urging US Senate action on legislation recently passed by the US House of Representatives that would increase transparency on federal unfunded mandates and their effect on State and County governments.

From NACo:

UMITA sets a variety of guidelines to further require federal agencies to analyze the effects of federal regulations on state and local governments. First, it would set specific standards for federal agency consultation with state and local governments when that agency is considering a new rule or regulation. UMITA would also require federal agencies to include consultation activities with state and local governments in annual compliance statements. Additionally, it allows the chair or ranking member of any standing or select congressional committee leadership to request a “lookback” of regulations to evaluate the financial impact of federal regulations.

According  to NACo, the U.S. Senate has not taken up the companion version of the UMITA bill. NACo encourages counties to ask their senators to support this legislation or similar bills.

For more information, see House passes bill enhancing transparency and coordination with local governments on unfunded mandates from the NACo blog.

The MACo Summer Conference will feature a federal policy update from Maryland’s US Senator Ben Cardin on Friday, August 17, 2018; 10:30 am – 11:30 am. In a town hall setting, Senator Cardin will give an update on legislation in the 115th Congress and speak with county elected officials about their top priorities.

Senator Cardin was first elected to the U.S. Senate in 2006. He is a senior member of the Environment & Public Works Committee and Small Business & Entrepreneurship Committee and serves on the Senate Finance Committee.

 

Learn more about MACo’s Summer Conference: