Montgomery County Taxpayers League

The Voice of Taxpayers of Montgomery County, Maryland

January 16, 2014 – Craig Rice

Questions sent to Craig Rice

 in advance of the meeting of January 16, 2014, and his responses:

 Questions sent to Craig Rice, President, Montgomery County Council, in advance of the meeting of January 16, 2014, and his responses given at the meeting:

Mr Craig Rice first provided some background information about the Montgomery County Council.

Several libraries and recreation centers are being renovated. It is important to do the construction now because construction costs are low.

He wants to add more police officers so that there will be at least one in every high school.

 1. As this is an election year and though fiscal projections for the year, while they have improved, continue to prove challenging, how do you think taxpayers will fare versus powerful special interests?  Will there be a trend upward or downward for property taxes and energy taxes?  Do you foresee any new taxes or fees in the offing?

 Mr. Rice predicts there will be a reduction in some fees and taxes, especially those on business. He supports scaling back the bag tax.

His general philosophy is that there has to be balance. It’s unfair to put the responsibility for society on one or a few groups; it’s everyone’s responsibility.

Waste, fraud and abuse are due to people, not to operational structures.

On the proposal to raise the minimum wage Mr. Rice said his staff is talking to officials in other counties. He is not against the minimum wage but prefers that the state move first because of the effect of the Law of Unintended Consequences. Increasing the minimum wage would escalate the wages of everyone. The increased minimum wage will affect non-profit groups but it is unknown to what degree.

2. Constrained as we are by the Maintenance of Effort law, fully funding the MCPS at the state-mandated level would require a reduction in spending for all the rest of the services provided by the county government.  How much is this reduction projected to be?  How do you plan to meet the increasing demand for services by the poor, the disadvantaged, and the unemployed?  For instance, it was recently noted that the county paid over $650,000 to cover permanent housing costs for 15 homeless people? How will you continue to meet such and other needs, cover wage increases for county employees and maintain the current quality of services while balancing the budget?

 The operating budget request of the Montgomery County Public Schools contains $37 million above what is required by the state’s Maintenance of Effort (MOE) law. It will be difficult for the county to fund the MCPS budget above the level mandated by the MOE because any increase in funding increases the MOE level forever. Instead, MCPS should look at ways to cut costs. MCPS predicts the future student population but those forecasts recently have underestimated the actual school population. These inaccurate predictions have led to portable classrooms. One way to reduce costs would be to increase the student-teacher ratio.

Asked about the passage of the amended Maintenance of Effort law, he said the Maryland Association of Counties along with numerous county officials across the state opposed the legislation. However, the Maryland Education State Association (teachers union) was strongly in favor of it, and MSEA is a very powerful force in Maryland politics.

MACO was against not only the MOE legislation; it also opposed moving the funding of teacher pensions from the state to the counties.

MCPS is structured in such a way as to continue doing things in the same way. The County Council has little power to make significant changes in the schools. It can change funding in the 14 budget categories but cannot tell the schools how to spend the money within the individual categories. Having an inspector general in MCPS would raise public perception of the school system.

In the public schools there should equity in the access to technology. Special items should depend on eh the ability of each school’s PTA to raise the necessary funds.

The county’s Capital Improvement Program is heavily focused on school construction.

3.   A recent report by the Maryland Public Policy Institute claimed that Maryland state and local governments carry nearly $28 billion in unfunded retiree health obligations. For Anne Arundel county, the number is $1 billion creating an exploding health benefits liability.  What is the number for Montgomery County and how are we addressing the issue?

Montgomery County is funding health liabilities for retirees but Mr. Rice is not sure where it should be.

4. (a) The Homeowners Property Tax Credit is a means-tested tax credit.  It is our understanding that a very small percentage, perhaps 20%, of eligible residents claim the credit. How do you spread information about this tax credit to all eligible homeowners?  With more residents aging in place all of whom face increasing property taxes many with fixed incomes, how do you plan to publicize the program and should the means-testing be updated to reflect reality?

(b) For years the Homestead Tax Credit has been 10% for Montgomery County homeowners, the maximum allowed by law.  Only a few jurisdictions have the 10% with a vast majority having a much lower percentage.  Would you consider reducing this percentage to 5% over five years noting that the real estate market is increasing and in many areas of the county has increased much more than 10%?

 Mr. Rice said that only 20% of those eligible for the property tax credit actually apply for it. He will be appearing on WUSA periodically to talk about Montgomery County and will publicize that tax credit there. It was suggested that state data could be used to make homeowners aware of the credit.

5.   Given your experience as a delegate to Annapolis, how can you ensure that our current representatives to the State legislature look out for the fiscal interests of Montgomery County?  For instance, could the Department of Intergovernmental Affairs publish the voting records of our delegation on the county website?  The State website is not user-friendly.

He predicts that the relationship between the state and the County Council will be smoother and more productive.

It was suggested that there could be a “hackathon” to aggregate information on the voting records of each member of the County delegation.

6.   Several years ago, there were reports in the press that some elected officials were in arrears on their state and federal taxes.  As the Taxpayers League, we believe that all taxpayers should be current on their tax obligations.  How can the taxpayers of the county be assured that all elected officials in the county are current on their tax obligations.  Is this currently covered under financial disclosure requirements or ethics laws.