County Leaders Ponder the Highway User Fund Debacle 8/09
Commissioner Wilson H. Parren, President of the Maryland Association of Counties (MACO), can no longer absolve Governor Martin O’Malley from the blame for the drastic loss of highway user revenues to Maryland’s counties and municipalities.
As part of his introduction of O’Malley at the annual Governor’s speech at the MACO summer conference, Parren described O’Malley as “one-of-us” from his days as a councilman and mayor of a local jurisdiction. Parren added emphatically that county officials knew that Governor O’Malley didn’t cut their local highway user funds - it was that nasty General Assembly that made those cuts.
Highway user funds are a statutory portion of the Transportation Trust Fund (funded by state gas taxes, titling taxes, rental car sales taxes, licensing and registration fees, federal transportation funds and bond sale proceeds) dedicated to counties and municipalities for local transportation projects.
To the county leaders, it was important that O’Malley be absolved of the blame because, as a candidate, O’Malley made a campaign promise to MACO and Maryland taxpayers that he would not divert transportation funds away from their dedicated purpose: road construction and other transportation initiatives.
The odd thing about blaming the General Assembly is this: in O’Malley’s 1st supplemental budget (March 23, 2009) during this past session, the classic conflict-avoider O’Malley created a budget reduction of $488 million in unspecified cuts to be determined by the General Assembly. O’Malley knew that there were only a few pockets of funds in reserve, including highway user funds, whereby the legislators could make substantial cuts of that magnitude. So instead of owning up to breaking a campaign promise, O’Malley orchestrated a process where it appeared that the General Assembly was the culprit in reducing highway user funds, transferring Program Open Space funds and other budget reductions during the legislative session.
With few other options, the General Assembly diverted a small portion of highway user funds (leaving most of the funds to localities intact) through legislation that transferred approximately 35% from special funds to general funds to balance the budget.
In a similar manner, Governor Robert L. Ehrlich, Jr., had drawn upon these funds in 2003 to deal with the deficit that he inherited from Governor Parris Glendening that by mid-session had grown to $2 billion. To help balance the budget, he borrowed $104 million from the highway user funds. MACO (primarily led by Democrat leaders from across the state) screamed bloody murder and for four years the MACO leadership acted like a dog with a bone over the highway user fund cuts – even though Ehrlich repaid some of the funds to the localities in later budget years.
Whipped into a frenzy by the Democrat county officials, this became a campaign issue in 2006 since rural counties are generally hit hardest by the highway user fund reductions. Larger counties use the funds for maintenance projects and road re-pavings which can just be deferred, but to smaller counties (such as Garrett County), the highway user funds comprise the majority of their local transportation budget and are used for county roads department staffing and salaries, highway planning, construction, maintenance and snow removal operations.
Sensing a wedge issue between Ehrlich and his base, the O’Malley campaign website promised:
End Raids on the State’s Transportation Trust Fund. Martin O’Malley will end the raiding of Maryland’s Transportation Trust Fund, ensuring that money meant for transportation will be used on our highest transportation priorities, instead of being diverted away. O’Malley will also ensure localities have the ability to make their own smart transportation investments.
What are the MACO leaders to say now? At the worst of times during the Glendening deficit’s peak, Ehrlich reduced the highway user fund by approximately 29%. During the session, the nasty General Assembly reduced it by 35%.
But yesterday, MACO’s “one-of-their-own” O’Malley reduced highway user funding to 23 of 24 jurisdictions by a catastrophic 90%. Only Baltimore City was spared with a 19% cut, which softens the statewide average to a 52% total reduction in local highway user fees.
You just wonder: what does Commissioner Wilson Parren think today?