No More Municipalities in Montgomery?

Not too long ago the County Council unanimously torpedoed an effort to schedule a vote on whether the Rollingwood Village of Chevy Chase would become Montgomery County's twentieth municipality. According to the pro-incorporation committee, over 30% of voters in the proposed village signed a petition to call for a vote on incorporation. So why did the Council turn them down flat?

Of course, it's all about the money. As the Washington Post reported:

But skeptics say that more is at stake than a seat at the political table. Tucked in among the documents for proposed incorporation is a plan that suggests rebates to residents if the town doesn't spend all its money.

That seemed particularly nettlesome to some on the County Council, whose members expressed little enthusiasm for the Rollingwood plan last week, and whose staff attorney wrote a 115-page report that highlighted alternatives.

"Does a particular group of fortunate residents have a right to have better streets?" asked George L. Leventhal (D-At Large) during the council's hearing.

Municipalities receive a share of the state income tax, so wealthier municipalities have more money. Even without exercising their right to levy additional property taxes, they can provide their residents better services. However, only one very small municipality actually uses the funds to provide a tax rebate to its residents.

The debate raises important questions about finances and local government. In Connecticut, where counties basically exist only on the map and the towns are powerful, wealthier towns use their power to zone out poorer residents by preventing the construction of low income housing and failing to provide services to help people in need.

As a result, one of the wealthiest states in the country concentrates most of its poverty in a few very troubled towns: Bridgeport, Hartford, New Haven, and Waterbury. These towns face a terrible dilemma. If they raise taxes to provide the services their poorer residents need, they discourage affluent taxpayers from settling in their towns even while attracting more poor residents.

Maryland doesn't face this problem. If I am not mistaken, Maryland has fewer government units than any state except Delaware. Compared to Connecticut towns, Maryland's large counties are simply too big to zone out the poor and are forced to grapple with problems generated by the poor. While I imagine many can still criticize, the large subsidized housing development located on Bradley Blvd. would simply be unthinkable if the state were divided into many itsy-bitsy municipalities.

However, municipalities in Montgomery simply don't threaten to create the same problem because towns are far less independent here than in Connecticut. The County still performs the vast majority of functions in most municipalities and gets to keep the bulk of the funding as a result. Moreover, some of the benefit to living in a municipality comes from government being closer to the people with officials who can tailor services to their residents and keep a close watch on service providers.

And it may actually be a good thing if some munis provide extra services. As Harvard Prof. Paul E. Peterson described years ago, local governments essentially compete to attract residents who pay more in taxes than they receive in services. Providing a few extras may help keep people in the County who help make sure the overall standard of services remain high for everyone.

One cannot help but wonder if the County Council also opposes more munis not just because of the money but because municipal governments institutionalize are a built-in lobby which can articulate demands for their communities and challenge the assumption of county officials--both elected officials and bureaucrats.