Governor Martin O’Malley has released his new budget plan for the state of Maryland and for the second year in a row Prince George’s County will take it in the jaw. Under Governor O’Malley’s plan Prince George’s will be cut by $27 million while counties like Montgomery will actually see an increase of nearly $73 million. Some of the cuts actually aren’t under the control of the governor, per se (per say). According to state numbers because Prince George’s County is considered actually to be the wealthiest jurisdiction in the Maryland now, their share of aid from the state must be cut under law. Most of those cuts will actually impact education, more than 23.6 million according to numbers shared at a meeting of the Prince George’s County Board of Education tonight.
The counties wealth along with the fact the school system lost 1000 students compared to last year not only will cost aid from the state for the school system but the county as well. School system administrators are preparing to face a cut of another $4 million by the county government. So while Governor O’Malley has promised not to cut education in the state, Prince George’s school officials are preparing to cut 28 million dollars from their budget. This comes after Dr. Hite presented a budget in December last year that already cut over $42 million. To do that Dr. Hite and his administration tried to save jobs by increasing classroom sizes, and furloughs that include teachers.
Net Taxable Income Strikes Again- In presenting their new budget reduction requests today, school administrators faced questions from board members about the impact the state’s Net Taxable Income law was playing in these cuts by the state. Vice Chair Ron Watson and Board Member Pat Fletcher asked how Prince George’s could be considered to be the most wealthiest in the state. Administrators reported that because counties like Howard and Montgomery have taken such big hits during the recession, Prince George’s has traditionally been a place that stays calm. In the good years Prince George’s normally will experience a slight rise as the economy gets better while places like Montgomery often see large increases in wealth. The same is the case in the bad times as Prince George’s has experienced a slight fall off compared to the deep budget gap Montgomery County is facing. That said the issue of Net Taxable Income is still a problem. According to school finance officials Prince George’s County Public Schools still expect to lose more than $10 million as a result of the law.
Net Taxable Income formula used to provide many state funding sources like school aid from the state based on the taxes residents pay. Leaders in Prince George’s County have long fought for a change in this law because they say since so many more wealthy residents in counties like Howard and Montgomery file their taxes late through extensions which aren’t reported in the current formula, Prince George’s often comes out more wealthy in comparison than is the case in reality. Last year according to administration officials in the school system Prince George’s lost out on more than $20 million.
Prince George’s as the most wealthy in the state- Most residents in Prince George’s County likely will be surprised to hear that they are the most wealthy in Maryland. According to numbers reported by the Maryland Department of Labor the unemployment rate in Prince George’s is 7.3% compared to 5.3% in Montgomery. In fact of the 24 jurisdictions in the state Prince George’s ranks about number 15 in unemployment. Prince George’s County also has the highest number of home foreclosures in the entire state a number which is not calculated in the Net Taxable Income formula.
Senate President Mike Miller of Prince George’s in a story published by the Gazette said, “”And also as a inner city mayor, the governor’s going to recognize and appreciate the challenges of an urban environment such as Prince George’s County, and I’m certain adjustments will be made.”
Prince George’s County legislators are now playing defense in Annapolis to ensure they do what they can to stave off as much of these cuts as possible during the year they will have to return home and run for reelection.
The governor’s budget does not include any tax increases.