Local government leaders seek their share of Maryland surplus

August 20, 2005|By David Nitkin | David Nitkin,SUN STAFF

OCEAN CITY - Some local government leaders say they bore the brunt of state budget cutbacks during the recent economic downturn, and they want a share of Maryland's reported $1 billion surplus now that times are better.

"Counties have really been taking a hit," said Thomas Perez, president of the Montgomery County Council. "We need better resources."

Getting Gov. Robert L. Ehrlich Jr. to provide them with a hefty boost for school construction and road projects was a major topic of discussion at the annual summer conference of the Maryland Association of Counties, which ends today.

Ehrlich, a Republican, has not specified what he plans to do with the budget surplus, but has indicated that he might propose helping taxpayers by earmarking some money to lower the state portion of property taxes.

The state tax rate, which is much less than the property taxes collected by counties, was increased by the governor in 2003, his first year of office.

Government watchers here are waiting to see whether Ehrlich will address the tax-cut issue when he speaks to the conference today. However, the idea of a property tax cut is receiving a lukewarm response from some conservative Democrats who typically support the governor across a range of issues.

Comptroller William Donald Schaefer said the state's revenue outlook has not improved sufficiently to warrant a reduction.

"The time is not right," Schaefer said. "[Ehrlich] is in favor of it. But he's wrong. He doesn't have that money yet."

Anne Arundel County Executive Janet S. Owens said she fears that Ehrlich and leaders in both parties will embrace the idea of lowering taxes next year, an election year, to create good will among voters.

"It would be so easy in a political year to say, `Let's give a $35 tax break,'" said Owens, a Democrat. "I hope that doesn't happen. I fear both parties may try to do a quick and dirty tax cut."

Much of the state's approximately $1 billion surplus from last year has been spent in this year's budget, but about $300 million hasn't been spoken for.

During the last three years, the state withheld about $240 million in local road building and repair money that was supposed to go to Maryland's 23 counties and Baltimore City.

The one-year surplus has not erased a projected gap between future revenues and expenses, driven by the cost of health care and public schools.

"We have not done anything to address the structural deficit," said Del. Norman H. Conway, an Eastern Shore Democrat and chairman of the House Appropriations Committee.

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