Thursday, November 05, 2009

MoCo Threatens to Sue the State Over School Funding

An increasingly explosive dispute between Montgomery County and the state government over public school funding looks like it may be headed to court.

This morning, the Post reported that Attorney General Doug Gansler had found the county's attempt to meet state requirements on school funding to be illegal. We explained the state's rules on school funding last May: counties are required to spend at least as much of their own money on public schools each year as they did in the prior year, with only exceptional circumstances allowing for a waiver. Last spring, Montgomery County applied for a waiver based on its poor economy and the tax-limiting Ficker Amendment and was turned down by the state. The consequence was that the county owed $79 million more to the school system than it had budgeted. We argued that the county should use money it had set aside for reserves to pay the school system, but the county opted for a budget gimmick instead. The county decided to send $79 million more to the schools, but then charge them the same amount for debt service related to construction projects, a practice it had never instituted in the past. We called that move a "desperate budget gamble" and Gansler's opinion now threatens millions of dollars in penalties.

The response by County Executive Ike Leggett and County Council President Phil Andrews to Gansler is two-fold. First, they criticize the school funding law (called "maintenance of effort") and repeat their claim that the state was wrong to deny the county's waiver request. (We analyzed the state's reasoning for denial here.) Leggett and Andrews discuss the need for unspecified "legislative remedies," but they are not likely to come for many months if they come at all. Second, the Executive and Council President openly threaten to sue the state. Maryland's schools are currently ranked as the best in the nation and MCPS is its biggest local system. Any school-related lawsuit between the nation's top-ranked state and one of its top-ranked counties would be a disaster for all sides.

We reprint the press release from the County Executive and the Council President below.

Statement by County Executive Isiah Leggett and County Council President Phil Andrews on the Attorney General’s Opinion on the County’s Compliance with the Maintenance of Effort Provisions of State Education Law

November 5, 2009

“The opinion by the Attorney General that Montgomery County did not meet the State’s Maintenance of Effort school funding requirement is disappointing – and wrong.

“This opinion second-guesses local efforts to fully fund the needs of County school kids and meet critical County needs during this unprecedented fiscal time and limits the flexibility of local County and school officials to craft responses to the challenges before us.

“This opinion ironically could penalize our school children. It potentially forces cuts in school programs, and even further cuts in critical services such as public safety, libraries, and help to the most vulnerable County residents.

“That’s why Montgomery County will exercise all options to challenge this opinion. We are prepared to sue the State of Maryland – and we will aggressively pursue legislative remedies to a law that is fatally flawed.

“Montgomery County has shown its strong commitment to public education by devoting nearly half its budget – year in and year out – to K-12 education, far above and beyond what has been required by the State of Maryland. Over the past decade the County’s support for our schools has exceeded the State’s Maintenance of Effort requirement by a total of $576.8 million. To be penalized now for this outstanding support would be nonsensical.

“During the past decade, MCPS enrollment has risen by 5.4 percent while our local contribution to the schools increased 75 percent. For the past two years, even with fiscal challenges, we have significantly reduced both the overall capital and operating budgets of the County government in order to ensure that our schools had the necessary resources.

“Only the severity of the economic downturn and the dire consequences for the County’s overall budget caused us to request a waiver this year and ultimately to pursue a sound way to meet the Maintenance of Effort requirement. Despite these challenging conditions, we still funded 100 percent of our School Board’s education request. Any penalty imposed by the State on the County school system for ‘inadequate’ local support of public education would defy common sense and would be a gross waste of scarce funds in hard times.

“Montgomery County continues to support our world-class school system while sustaining critical programs in public safety, safety net services for our most vulnerable County residents, and initiatives to support our children and youth.

“We cannot accept this opinion as the final word. Too much is at stake – for County students and for County residents dependent on critical services.”

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Patrick Lacefield, 240-777-6528
Neil Greenberger, 240-777-7939