I am disappointed that no reductions were made to the Pittman budget. I testified at the County Council public testimony session in Annapolis last month. In my opinion, failure to make any adjustments to Pittman’s budget shows lack of independent thinking and indicates the budget was basically predetermined by the county majority controlling democratic party before the public hearings. Unfortunately, politicians of both parties will generally sell out to their special interest supporters excessive demands unless voters in general call them out on it. I believe that was the case here.
I am a retired federal macroeconomist that tries to look at politics in a pragmatic manner. I am a registered democrat that strongly favors the democratic party at the national level and strongly believes in consumer protections as well as significant aid to the disadvantaged to help them improve their situation. However, I have become an independent voter for state and local office. This is largely due to the never ending increases in real tax rates and fees enacted by the state democratic party over the last 20 years. In my opinion, the County Executive and majority County Council continued the trend of significant excessive state and county spending greatly increasing the real inflation adjusted tax and fee burden of state and county residents.
Maryland is already a very high tax state. Kiplinger puts it sixth on the list of highest tax burden for a middle class family 10 Least Tax-Friendly States for Middle-Class Families, Anne Arundel County is viewed as a moderate county politically and is more tax friendly than other Maryland's urban counties and needs to be vigilant to avoid unnecessarily further expanding real tax rates and fees. Given that 2025 will be a non-election year, large state tax hikes are likely due to the Blue Print for Education law and Maryland being dominated by one party making compromise less likely.
Pittman portrays his budget as moderate, prudent, and pragmatic. I do not believe that this is the case. Pittman's budget calls for an 8.2 percent increase in county spending. If one assumes an inflation rate of 2.7 percent in the county for 2025 (based on recent data on the CPI-U for urban Maryland) this means that real (price adjusted) spending is expected to increase 5.5 percent. County population growth in the last two years has been 0.2 percent per year so the Pittman budget translates into a 5.3 percent increase in real per capita county spending under those inflation and population growth assumptions. I do not believe that this is a pragmatic or prudent increase in county spending.
The Anne Arundel County Council and county governments in general are under very difficult constraints due to the Maryland Blue Print for Education (MBPE) which imposed a 10 year $38 billion required spending price tag on Maryland with a one third as mandatory spending to be financed by the counties. I believe the goals were good but mandated spending consistent with fundamentally good to very good schools and encouraging students to take advantage of it would have made a lot more sense than a huge unfunded mandate lacking adequate oversite. I also believe it is wrong not to allow counties significant input and discretion in educational spending. I believe county governments and residents should make their unhappiness with these requirements well known to state officials and taxpayers and adjustments to the education law are need promptly.
I believe given the educational mandated spending increases that the county government should be very tight on the noneducational spending side to avoid huge tax hikes on county residents that over time which will erode the county tax base as more retirees and higher earners leave the state and county. I admire politicians that approach problems pragmatically and not based on favoring special interests that support their party. Pittman’s budget increased county non educational payroll numbers significantly. Salaries for county employees need to be competitive with input from number of applications and qualifications and time to fill vacancies. However tax payers bear the burden if salaries exceed the level needed to hire and maintain staff.
Areas of the Pittman budget that I especially disagree with are increases in personal tax rates and the huge increases in permit fees and indexing them to inflation. The increase in the county personal income tax of seems small increasing from 2.81 to 2.94 but represents a 4.62 percentage increase in the tax rate, Since FY 2019 when the rate was 2.50 percent this represents a 17.6 percent increase. I do agree with the tax rates being made more progressive in recent years, but I do not believe anyone making under 100K as a single person or 150 K as a joint filer should now see their taxes rates raised at all. In addition Maryland's tax code is not indexed to inflation much. Other than the standard deduction and the pension deduction, few Maryland deductions or credits are indexed to inflation and tax brackets are not. This causes an individual tax payer whose income rises by inflation (many pensioners) to have his state taxes increase by more than inflation. This especially unfair to retirees and low income earners.
I encouraged the board to examine the United Van Lines Movers Survey 2023 National Movers Study | United Van Lines® https://www.unitedvanlines.com/newsroom/movers-study-2023
The survey shows Maryland is losing significant residents to net emigration from the state. Moreover it is not predominately a moving south phenomena in the Maryland case. States adjacent states to Maryland such as Delaware, Virginia, and West Virginia are on net gaining residents through immigration from other states. Maryland's losses are especially pronounced among retirees and higher earners. High cost of living in Maryland is stated in the survey as an additional reason for leaving Maryland and higher taxes and fees will directly and indirectly attribute to the net emigration problem for the state. I understand that County Council cannot fix the problem of the lack of Maryland tax competitiveness relative to its neighboring and other states but I believe it should be aware of it and not contribute to the problem.
Please explain the inappropriate content below.
