Message from the Chairman: 

How is the O'Malley Administration Failing Maryland's Disabled?

    

 The O'Malley Administration provides a painful reminder that putting money in government budgets and then providing services are not the same when programs do not perform.  Kudos to the Maryland Reporter and journalists Len Lazarick and Glynis Kazanjian for their continuing coverage of the serious O'Malley Administration's failures at Developmental Disabilities Administration (DDA.)  In November the Maryland Reporter covered the $38 million in DDA funds that went unspent in fiscal years 2010 and 2011. Bookkeeping maneuvers inappropriately assigned unspent funds to previous fiscal years, rather than using them to restore budget cuts or take people off the DDA waiting list.

DDA is an agency within the Department of Health and Mental Hygiene that provides funding for a wide range of services for thousands of individuals with developmental disabilities.  The agency pays for these services with federal Medicaid and state funding.  DDA's Fiscal 2012 budget is $800 million, including $455 million in state general funds.  This represents an increase of more than $40 million from FY 2011.   DDA expects to support services for approximately 25,000 people this year.  They serve many of Maryland's most vulnerable citizens; developmentally disabled persons are children and adults with Down syndrome, cerebral palsy and autism.

To put a human face on the state's failures, currently there are 6,500 Maryland residents on DDA's waiting list, 107 of them considered to be in critical crisis mode.  "It's incredible," said Sen. Edward J. Kasemeyer, chairman of the Budget and Taxation Committee. "In an agency dying for money, this level of incompetency - it's terrible."

 "Maryland has a responsibility to ensure that services for citizens with developmental disabilities are properly funded," Laura Howell, executive director of the Maryland Association of Community Services and chair of the Maryland Developmental Disabilities Coalition, told the Maryland Reporter. "That is currently not the case, which is why we are urging the governor to restore the unspent funds and reverse the painful budget cuts that were inflicted in FY 10."

The management breakdown at DDA is not news to the O'Malley Administration.  Two years ago the state Office of Legislative Audits uncovered that the agency paid contractors for services to dead people, failed to properly monitor clients who lost their Medicaid eligibility, reported inaccurate information about waiting lists to the General Assembly and did not have adequate security for its information systems.

Rather than address their agency's failures, though, earlier this year the O'Malley Administration lobbied for a 50% increase in the alcohol tax intended to give DDA a fiscal boost. Among the most effective advocates for the increase was Maryland's disability support community.  A new 9% sales tax went into effect in July after their lobbying. 

"We had no idea that this mismanagement was taking place," said Nancy Pineles, developmental disabilities managing attorney for the Maryland Disability Law Center. "What's very hard to swallow is that at the same time that the services were underfunded, we were advocating our support for the alcohol tax."

But it gets even worse.

Marc Kilmer of the Maryland Public Policy Institute reports that although the tax hike was presented as a way to fund disability programs, when the tax passed the General Assembly most of the money went to new school construction.  The allocation was divvied up based on politics, not on need.  Baltimore City, Prince George's County and Montgomery County will receive $9 million each. The entire Eastern Shore will receive $1.25 million. In per-pupil terms, the Eastern Shore gets $27.07 for every student while Baltimore City gets $114.48.

How did the State legislators come up with the formula for their sleight of hand maneuver to reallocate the tax revenues intended for the disabled?  Kilmer points out that in the first round of school construction projects approved by the Board of Public Works, every project was located in a district represented by a legislator who supported the tax hike.  Legislators from Montgomery and Prince George's counties, and Baltimore City, overwhelmingly supported this tax hike. On the Eastern Shore, only Democratic Del. Rudy Cane voted for it.

The next time Governor O'Malley talks about his budget increases for Maryland's disabled, hopefully someone will be ready to ask - "But did they actually get the services you promised?

Mark Uncapher

Montgomery County Republican Chairman 

Maryland Education Spending by the Numbers, Part II

By Mark Newgent, Red Maryland

http://redmaryland.blogspot.com/

Maryland Education Spending by the Numbers Part 2

In Part 1, I showed that the explosion in Maryland education spending--$4.2 billion since 2002 through the Bridge to Excellence or Thornton mandates--hasn't delivered to taxpayers the bang for the buck they should expect. 

Drilling deeper into the data, we find that this massive amount of increased spending hasn't closed the achievement gap--the ostensible goal of Thornton--between White and minority students and between low income-students and their higher income peers.

Furthermore, the explosion of education spending (two thirds of Maryland's general fund) has created a huge strain on the state's budget, is a key component of the state's chronic structural deficits, and is crowding out other programs.

Billions of Dollars Spent on Persistent Achievement Gap

On the 4th and 8th grade reading and math assessments, Maryland showed minimal to no improvement in the achievement gap between Whites and minority students and between higher income and low-income students. In some areas the disparity increased.

Fourth grade Hispanic students did make gains in slightly closing the achievement gap with their White counterparts.

Between 2003 and 2011, Hispanic students closed the gap with White students by four points on the NAEP math assessment, and six points on the NAEP reading assessment.

The achievement gap between African-American and White 4th graders dropped 2 points on the NAEP reading assessment. However, the 28-point gap between White and African Americans on the math assessment remained consistent over the last eight years.

The achievement disparity also closed between low-income and higher income 4th graders (as determined by eligibility for National School Lunch Program). Low-income students closed the gap on the NAEP math assessment by 3 points, and on the NAEP reading assessment closed the gap by four points.

Those gains seem impressive, however, they become less so when you put them in context.

For example, while Hispanic fourth graders made gains, the reading gap disparity between them and White fourth graders, is 16 points, and in math it is 13 points. The achievement gap between African-American fourth graders and White fourth graders in reading is 29 points.

The reading and math disparity between low-income and higher income fourth graders is just as stark. Despite the modest advance, the reading gap over the last eight years stands at 27 points, and the math gap at 25 points.

By the time those students reach the eighth grade those minimal gains are all but erased.

On the NAEP 8th-grade math assessment the gap between White and African-American students increased from 33 to 36 points between 2003 and 2011. The gap between Whites and Hispanics increased from 27 to 30 points over that same period.

The 8th-grade reading gap between Whites and Hispanics over the last eight years remained at 20 points, and the increased one point from 26 to 27.

The gap between lower income and higher income students also increased between 2003 and 2011. The disparity gap increased three points from 30 to 33 on NAEP 8th grade math assessment, and the increased one point from 26 to 27 on the NAEP 8th grade reading assessment.

Spending and NAEP data confirms what data from the rest of the country tells us: the more money we spend on education does not translate into increased educational outcomes.

Despite this stark fact, pandering Maryland politicians trot out Maryland's much vaunted and number one ranking by Education Week, anytime there is a whiff of cutting education spending.

Yet when you dig into the Maryland specific data in Education Week's Quality Counts Report all that glimmers is not gold.

In fact, Maryland only received an overall grade of B+ on the Quality Counts Report. According to the report, Maryland ranked last in the nation (50th) on the poverty gap for NAEP 8th grade math scores, and 34th in the nation for the math gap change for that assessment test. Even in the area of 4th grade reading where Maryland's best gains were made the state only ranked 34th in the nation. 

Quality Counts number one ranked school system ranks a middling 22nd in the country for high school graduation rate, and worse, Maryland ranks 34th in the nation for change in graduation rate.

Even Maryland high school graduates need remedial help. According to a Maryland Higher Education Commission report on the college performance of of new Maryland high school graduates, 61 percent of core community college students (those who took a college preparatory track in high school) needed remedial math instruction. Fifteen percent of core students attending a Maryland four-year institution needed remedial math instruction. The additional cost to taxpayers for this remediation is $90 million annually.

Straining Budgets and Crowding Out other Programs

Education spending consumes roughly two thirds of Maryland's general fund budget. Also, the mandated increases in the Thornton spending formulas translate roughly into the amount of the chronic billion dollar plus structural deficits Maryland faces.

The Maryland data confirms that increased spending in does not equal increased achievement out. Rather what really matters is how the money is spent, and other factors outside of funding. Indeed, as an independent study of the increased spending in the Bridge to Excellence Act found, more than half the increased spending went not to the classroom but to teacher salary and benefits.

Education spending in Maryland is crowding out other programs like infrastructure. Governor O'Malley's new stalking horse is a 15-cents gasoline tax increase to replenish the transportation trust fund he's raided to cover general fund deficits.

Instead of raising taxes, Maryland could cut and cap education spending at 2008 levels. 2008, it should be noted, was the first year Maryland schools earned the ballyhooed number one ranking from Education Week.

For example, spending capped at 2008 levels for FY 2011 would have saved $570 million, which could be used toward infrastructure spending or other areas of the budget shortchanged by fund raids and other budgeting gimmicks.

$570 million would have more than covered the $264 million in Medicaid payments to hospitals O'Malley slashed, which turned into a tax increase on hospital patients and health insurance premiums.

Another solution is to move responsibility for teacher pension and other post employment benefits (OPEB) from the state pension system to the counties, which negotiate the contracts. Maryland's pension and retiree healthcare systems have $34 billion in unfunded liabilities, and one study showed the pension system running out of money in 13 years. Moving these costs off the state's books would go a long way in shoring up the state's pension fund and reduce future liabilities and strains on the state budget.

Moving teacher pension and healthcare costs to the counties also has the added value of creating real spending transparency for taxpayers, as the true amount of what we spend on education would no longer be hidden on the state's books. 

Maryland does not have a revenue problem it has a spending problem. Since 1997 Maryland has increased general fund spending by 98% while revenues increased only by 78%. If Maryland is to get its fiscal house in order it must look to cut spending, starting with the largest item in the budget: education spending. Real cuts, not reductions in planned increases must be made.

The solutions are quite simple. However it's the politics that is hard, for it would require Maryland's Democratic rulers to buck thepowerful public sector unions, who put them in office.

Be sure to check out Mark Newgent and Brian Griffith on Red Maryland Radio  http://redmaryland.blogspot.com/2011/11/red-maryland-radio-11-17-2011.html

The Maryland Public Policy Institute

The High Cost of Government Construction

by Marc Kilmer

Maryland government wastes a lot of money. Some of it is obvious (taxpayer funding for sports stadiums or subsidies to prop up the horse racing industry, for example). Some of it isn't so obvious. Reading today's paper, I saw an op-ed by my friend Chris Eccleston exposing the ways the state wastes money on construction projects. Not many people realize that the state government is overpaying for state construction in many ways, something that hurts both businesses and taxpayers.

Chris talks about a project his company bid on to build a bathhouse on the Pocomoke River. His company had the lowest bid, but because of a state set-aside program, it went to another company. 

As Chris explains:

We as taxpayers face extraordinary costs to build a public building; it would make your head spin. Let's use the [bathhouse] example.... The low bid was $1 million. With the small business 5 percent preference, the state chooses a small business contractor. Now the price is $1.05 million... Included are several other compliance programs -- a minority business enterprise program, Davis Bacon Act and administrative costs (compliance paperwork to be processed on a weekly basis). All of these costs are paid by taxpayers, which adds about 15 percent to the total project cost. So 15 percent of a million dollars is $150,000 compliance, plus 5 percent small business preference, which is a total of $200,000 in added taxpayer expense. This same building, all items being equal besides state and federal compliance, could be built by a private owner and would cost roughly $800,000.

Instead of simply accepting the lowest bid, politicians have mandated that the state use its construction dollars to promote certain public policy objectives: increasing minority businesses, helping small business, aiding unions, etc. These set-aside programs give politically-connected businesses a special advantage in the bidding process.

This may be good for those businesses, but it's bad for taxpayers. Take the prevailing wage requirement. This requirement is strongly supported by unions because it mandates that state construction projects be paid the "prevailing wage" in an area. Usually non-union businesses pay lower wages. If the prevailing wage mandate did not exist, these non-union shops could underbid union shops. But if all businesses are forced to pay the "prevailing wage" (something near the union wage), then the non-union business loses an advantage. The Davis-Bacon Act mentioned by Chris is the federal prevailing wage law.

A good article from the Cato Institute summarizes the various studies on the effects of prevailing wage laws. A Michigan study, for instance, "estimates that if Michigan municipalities had not imposed prevailing wage requirements, they would have saved $16 million that year." In Ohio, a legislative commission "report concluded that by allowing competitive bidding Ohio schools had saved $487.9 million, which was 10.7 percent of construction spending."

These requirements also hurt businesses. The most efficient businesses will be able to offer the lowest bids. But state law penalizes these businesses and, instead, favors less efficient businesses that fit into certain classes. This distorts the market, rewarding the less efficient. Competition is supposed to reward those who do better work using fewer resources. The state system favors just the opposite.

Some states have scaled back their set-aside laws. It's unlikely Maryland will be doing this any time soon. Until it does, every time you see a government building being constructed, remember that you're paying a lot more in taxes to build it than you should be paying.

Yet More Voter Disenfranchisement?

  By Alexandra Brown

The  upcoming elections in Maryland are shaping up quite nicely for those who wish to subvert the electoral process.   We need only to look at our less than stellar history of "cleaning up" outdated voter rolls; no photo id requirements; excessive union interference; and, a recent "redistricting  triumph,"  by Governor O'Malley.   The latest opportunity to expand voter fraud and abuse is proposed legislation that does not require an application for mail-in ballots for special elections in Montgomery County.

The Voter Rolls:

By law, Section 8 of the National Voter Registration Act requires states do "list maintenance, identifying and "cancelling" names of ineligible voters.  In 2010, Maryland, along with 15 other states, was cited as having voter rolls that were not updated.  Such examples of blatant neglect, include having deceased citizens on the voter rolls - although one employee in the board of elections office reported that they are supposed to "update voting records within two election cycles."

Christian Adams, a lawyer formerly with the Department of Justice noted to this writer that, "officials who proclaim difficulty in complying with the law either usually are adverse to purging the rolls, or aren't inclined to follow the law.  It doesn't take much money to get the list of dead people and purge the rolls, and if they are doing their job correctly, they should do regular maintenance on the rolls."    Unfortunately, it seems that the Department of Justice has chosen not to enforce the law, and out of that concern, groups like Election Integrity Maryland are now taking action which includes database research and engaging in other activities to help counter election fraud.

It is this awareness and actions of groups like Election Integrity Maryland that have helped Maryland to join 17 other states participating in a program called ERIC (Electronic Registration Information Center), which is working with the Pew Research Center. The goal of ERIC is to have accurate, cost-effective and efficient voter registration databases shared from multiple state and county databases according to staff.  While the recent efforts to "clean-up voting rolls" are long overdue, this joint effort should give one pause when the state has to enlist a private organization to help deal with a government run agency problem.

Photo ID:

It should be common sense to every legal citizen in the state of Maryland that voters should be required to show photo identification, prior to voting to maintain the integrity of the election process.   Yet, common sense seems to have been discarded by Senator Ben Cardin, who alleges voter disenfranchisement" ( the requirement that a photo ID will actually prevent legal citizens from voting).    Given the lack of photo ID, coupled with a de facto reputation as being a sanctuary state, it is reasonable to assume the lack of photo ID requirement will further question, the integrity of the voting process in Maryland.

Union Influence:

According to the Maryland Finance Database, unions contributed over $1.6 million to overwhelmingly support Democratic candidates during the last two election cycles.   Much of this money comes from dues paying members - not all of whom support the candidates endorsed by the unions.   Moreover, the Fair Share law signed by Governor O'Malley in 2009  has increased the amount of union dues funds, thereby providing an opportunity to increase the flow of money into Democratic coffers.

Redistricting:

During the 2011 special session of the Maryland State legislature, legislators worked on Congressional redistricting, based on the results of the 2010 Census.  Governor O'Malley presented his own version of the new Congressional districts - almost guaranteeing a one party state into the foreseeable future.  

From Governor O'Malley's statement from Oct. 15, 2011:

 "I'd like to thank the Committee for their hard work throughout this process, as well as the citizens who have submitted their comments and suggestions and all of the members of the General Assembly. I am looking forward to working with our legislature next week as we ensure that every citizen is fairly and accurately represented."

It is obvious that his statement was made to placate the "disenfranchised voter"  many of whom do not believe they will be "fairly and accurately represented."  However, Virginia offers a glimmer of hope where Republicans now control the legislature despite the gerrymandered voting districts that had been put into place by the prior administration.

Voter Application:

The latest assault on the voting process is coming from Senator Jennie Forehand, who along with the Montgomery County Delegation believes that it is not necessary to require voters to complete an application when requesting to vote by mail ballot for special elections.  This legislation has yet to be considered and was apparently borne out of concern for saving county taxpayer money (the last special election had a small voter turnout, but cost upwards of $8.5 million), which is commendable.  However, removing an application requirement takes away a layer of security that can serve as a check against potential fraud.   

In contrast, the Maryland Board of Elections and various groups scrutinized petitions to overturn in-state tuition for illegal immigrants, with a "fine-tooth comb" to verify information and signatures were accurate, which resulted in several thousand petitions being thrown out, and without recourse.   The Maryland Board of Elections and these groups interest in ensuring the integrity of the process is admirable, but it is a shame that they do not appear to extend that level of concern across the board.

When one looks at these examples in their totality, both Democrat and Republican should feel "disenfranchised" from the voting process.   As Thomas Paine stated in his dissertation on "First Principles of Government (1795):

"The right of voting for representatives is the primary right by which other rights are protected.  To take away this right is to reduce a man to slavery, for slavery consists in being subject to the will of another and he that has not a vote in the election or representatives is in this case."

It appears that increased voter disenfranchisement in Maryland,  as noted above, is not in keeping with what Thomas Paine and our forefathers had in mind for the citizens of the United States.  It behooves all voters - Democrats, Republicans and Independents to be aware and concerned about these threats to the voting process in Maryland.