Tuesday, March 30, 2010

How to School Annapolis

This year was supposed to be a lean year in the statehouse. Cuts were everywhere. Furloughs and pink slips were being handed out left and right. State aid and teacher pensions were on the chopping block. But somehow, the Prince George’s County state legislators were able to bring home an extra $18 million. How did they do it?

Take a seat, folks, because class is in session!

The Prince George’s delegation, also known as “the PeeGees,” is the second-largest county delegation in Annapolis. Six Senators and eighteen Delegates represent Prince George’s County alone. Two more Senators and five more Delegates have split districts that include pieces of Prince George’s. One of those Senators is Senate President Mike “Big Daddy” Miller, who has priorities that go far outside the county. The delegation has three standing committee chairs: House Economic Matters, House Judiciary and Senate Budget and Taxation. The group is more diverse than most people appreciate, ranging from do-gooder liberal Senator Paul Pinsky (D-22) to ethically-challenged, head-breaking Senator Nathaniel Exum (D-24) to young, wonky Delegate Justin Ross (D-22) to old, gruff House Judiciary Chairman Joe Vallario (D-27A) to smart, savvy House Economic Matters Chairman Dereck Davis (D-25), a potential future Speaker of the House. Senate Budget and Taxation Committee Chairman Ulysses Currie (D-25) is one of Big Daddy’s top lieutenants and makes sure his committee never strays too far from the boss. The Senators are all men, but a pack of young, hungry female Delegates is breathing down their necks and may someday take a couple of them out.

One spy says, “They are great street fighters. O’Malley fears them. They are the ‘victimized’ and they all believe it. They are much better at the ‘game’ – they take it personally, they take pride in ‘winning,’ and they are held accountable for playing it well by churches, etc. – not just one union.” The only sense of victimization felt by many MoCo legislators is the fact that they have not yet been elected to Congress.

As powerful as the PeeGees are, they have a problem: despite the incompetent administration of County Executive Jack Johnson, the county’s wealth is growing relative to the rest of the state. You might think that’s a good thing, but not in Maryland. The state’s wealth formulas punish economic success by diverting aid away from rich counties towards poorer ones. In the Governor’s FY 2011 budget proposal, Prince George’s was scheduled to take a 3.0% cut in aid, the biggest drop in the state. That’s just disrespectful, and no one disses the PeeGees. Here are the three things they did to turn the tables and bring home eighteen million slices of bacon.

1. Get Some Leverage
As of February 2010, 57% of Montgomery County registered voters were Democrats and the county votes overwhelmingly Democratic in every statewide election. So there has always been a sense that Democratic Governors can take MoCo for granted and hand out goodies for votes elsewhere. But 78% of registered Prince George’s voters are Democrats. Why doesn’t the same conventional wisdom apply to them?

The reason is because Prince George’s support does not come for free. They make a Governor work to get it. Three years ago, the biggest issue in the county was its deteriorating hospital system, which was on the verge of outright collapse. Governor O’Malley moved to save it by pouring tens of millions of state dollars into the system until a buyer was found. Meanwhile, the county government is trying to weasel out of its own payments to the hospital.

But the Governor’s unprecedented intervention wasn’t good enough for Prince George’s politicians as many of them withheld their endorsements last fall. (At the same time, nearly all MoCo politicians jumped on the O’Malley bandwagon despite having been screwed on school construction money the year before.) Prince George’s Delegate Dereck Davis, a power broker who chairs the House Economic Matters Committee, explained his non-endorsement to MPW this way:

…I have not endorsed anyone for Governor. Quite candidly, I think it is premature to endorse anyone until after the 2010 legislative session has been completed. Then, and only then, will I be able to make an informed decision about what’s best for the community I represent.
Translation: Give us a little more, Governor. That opinion was shared by the legions of Prince George’s politicians who swarmed into potential primary challenger Wayne Curry’s birthday party. The party was a bombshell that scattered shrapnel all over Annapolis and in hindsight was one of the best things to happen for the county.

So isn’t this ungrateful behavior by the PeeGees? Of course, but it also creates the most valuable commodity in politics: leverage. And O’Malley’s promise to help the county in its quest for more aid was a direct response to such tactics.

2. Be Persistent
Prince George’s politicians have been beating the drum on state aid for a long time no matter who has been in the Governor’s office. The latest rumble started last year, when the county’s increasing wealth caused a 1.2% cut in its state aid. Exum confronted O’Malley aide Joe Brice about it:

“It is clear Prince George's County has been hurt by these cuts,” he said. “We want to know what the Governor is going to do to rectify this? Because next year is 2010. And who is the Governor going to look for in his reelection campaign?”

Brice responded that O'Malley would try to bring all lawmakers together and work with them on the budget.

“As long as he is aware,” Exum shot back.
Delegate Justin Ross followed up with a bill to change the school aid formula, telling the Post that it was a “fairness issue.” The bill was voted down by the House Ways and Means Committee, but the PeeGees had laid down their marker for 2010.

This year Ross reintroduced that bill, which would have generated $39.6 million in new school aid for the counties. Prince George’s would have received $13.4 million, the most of any jurisdiction. Charles County would have been second with $4 million. MoCo would have received zero dollars. The PeeGees began sniping at MoCo in the Post over aid even though they were already getting FAR more aid than MoCo. Clearly, the PeeGees were not going to give up. O’Malley and the General Assembly leadership got the message.

3. Get Some Allies and Cut a Deal
There are three ways to get allies and cut a deal: persuasion, pressure and working out mutual gain. The PeeGees used all three to fix their aid problem.

Persuasion: The case made by Ross for a formula change involved the appropriate timing to determine wealth. Current state wealth formulas are based on tax returns filed through August 15 or September 1, but wealthy people often get extensions and file later. Ross and the PeeGees argue that undervalues the true wealth of jurisdictions with a lot of rich people in them, like MoCo, so they want to move the formula date to November 1. MoCo budget expert Senator Rich Madaleno (D-18) bought that argument, telling Ross that he had made a “compelling case” for changing at least one of the state’s formulas. Ross said, “Prince George’s County has no greater friend than Montgomery County in the legislature.” Oy!

Pressure: This is the product of the leverage and persistence discussed above. O’Malley needed Wayne Curry out of the way and the PeeGees were not going to cooperate until they got some bacon. As a result, the General Assembly’s leadership understood the importance of taking care of Prince George’s.

Mutual Gain: No budget bickering occurs in a vacuum in Annapolis. Everybody has complaints, and those who want to play ball can get some relief. This year, Baltimore City, MoCo and Prince George’s were each thrown a bone. The city got to keep the street maintenance money that some other jurisdictions were trying to take away. MoCo got to escape its Maintenance of Effort (MOE) fine. And the PeeGees got a change to the wealth formula covering disparity grants, which subsidize “poor” jurisdictions, that gave them $18 million. (They’ll be back for the much-larger education formula next year, and that will cost MoCo big-time.) So the city got to keep something it already had, MoCo avoided a fine it should never have had to pay and Prince George’s got brand new money. Who do you think made out the best?

Let’s not overstate our case. There are no LBJs running around the Prince George’s delegation and they have problems like everyone else. A few of them are deadwood, a few of them are banana-cakes and at least a couple of them are probably crooked. But as a group, they know how to squeeze the orange and get some juice to come out.

Now compare the above to our legislative “strategy” on teacher pensions. Our plan to avoid having Big Daddy stick it to us next year was to stick it to ourselves this year. Leverage, persistence, pressure, negotiation, posturing, recruiting allies, lining up votes, tough bargaining – you know, all those unsavory things that Big Daddy and the PeeGees do – well, some of our guys are too good for that. Others just don’t care because they are in Annapolis for other reasons. “Frankly, funding Ike and Nancy Floreen’s pet projects doesn’t get me out of bed in the morning,” sneers one MoCo delegation member.

Hear that? That was the bell. Class is dismissed.

Did we learn anything?