Across Decades, Lessons In Taxes, Recession Budget-making

Comparing recessions nearly two decades apart can be dicey, but there are a few things about how Howard County government handled the downturns of 1991 and 2009 that titillate the political imagination.

Republicans often rail against tax increases, but Republican County Executive Charles I. Ecker's first budget of $270.3 million proposed in April, 1991, included a 14-cent increase in the county property tax rate, a 5.6 percent spending cut, plus 40 layoffs. What's more, the two County Council Republicans at the time voted for that budget, and there was no taxpayer backlash. Ecker is proud that his efforts to build a bipartisan consensus to face the crisis did not result in the kind of taxpayer-imposed revenue restraints that have limited government in Anne Arundel and Prince Georges counties, he said recently.

This year, County Executive Ken Ulman did not propose raising tax rates in his $1.4 billion plan. He wants to cut general fund spending by 4 percent and ordered a four-day furlough for most workers outside the school system, while laying off nine people.

What would have been the political reaction at the time if their situations were reversed?

Is it politically harder for a normally tax-averse, austere Republican to raise taxes than for a Democrat?

Is it politically harder for a Democrat to order layoffs, furloughs and withhold cost-of-living pay raises to county employee union members who often support him politically?

Ulman wasn't expressing any opinions recently when asked to gauge the reaction if he had proposed a 14-cent rate increase.

"I don't know," he said. One thing that weighed on his decision, he said, was the knowledge that most people's property tax bills will rise slightly anyway, because of rising state assessments.

What he didn't say is that next year he's hoping to run for re-election, and wouldn't want a tax increase dogging him in the campaign. Still, he's cut some things over the past two years that provide annual savings, like elimination of the government's television studio, the print shop and curbing take-home vehicles.

Ecker's decisions came several years before the conservative Republican revolution of 1994, when the partisan split between the major parties seemed to harden and begin growing wider.

Also, Ecker is no conservative ideologue, but is more of a moderate Republican.

He's a very pragmatic official who engaged both his own party members and the tax critics of the day to help him find a way out of the fiscal morass.

"We involved them on the Spending Affordability Committee and we had support from Republicans," Ecker said. "They saw the county government was doing everything we could."

Involving critics was vital too, he said.

"You get people around the table - inside the tent - and they become your biggest supporters," he recalled.

Charles C. Feaga was one of those Republican council members in 1991, and he's hardly known as an advocate for higher taxes, yet he supported Ecker's budget.

"At that time, taxes were not extremely high," Feaga said. "We inherited a different situation."

Now, he feels, "we have reached our maximum. We just cannot increase it a penny." In fact, Feaga thinks the county now has too many firefighters and police officers, though Ulman has worked to increase their numbers, arguing there are too few for the county's growing population.

Other things have affected taxes along the way.

Howard's income tax rates rose 30 percent to Maryland's legal limit in 2004, after then-County Executive James N. Robey, a Democrat, pushed it through in the recession after the terrorist attacks of Sept. 11, 2001. In 2008, state sales taxes rose as Gov. Martin O'Malley, also a Democrat, tried to solve the state's structural budget deficit.

On the federal level, the nonpartisan Congressional Budget Office recently concluded federal taxes are at their lowest in three decades, so people may be paying less taxes overall.

This current recession is much worse than the one he faced, Ecker said, but Ulman's got some federal stimulus money to help, and he's had a year or two in office to prepare, while Ecker faced a looming shortfall immediately upon taking office.

The former Republican, now Carroll County's school superintendent, noted the county had less of a financial cushion then too, as there was nothing like the county's $48 million Rainy Day Fund.

State Del. Shane Pendergrass, a Democrat who also served on the County Council in 1991, said everything in politics isn't always about partisanship.

"There are times in government when things are less confrontational. Chuck [Ecker] wasn't," she said.

"People on the council wanted to get things done."

And while Democrats and Republicans may not have agreed on spending and taxation issues, they did more often form alliances across party lines on land-use issues.

"You come to a point where you feel like you don't have choices," she said. "No tax increase is easy."

Ulman surely knows that feeling.

"We've cut as deeply as I'm comfortable with without destructively affecting services," he said.