Robbing the Cookie Jar: Because It Was There


There is nothing like a budget crisis to show us the real priorities in Annapolis. Just watch how the politicians divide the shrinking pie. With state tax revenues sharply down, they can't find enough money to please everybody this year. So who loses?

Our future. That's who loses.

Legislators look over their shoulders at voters and then follow the dominant political strategy in late 20th-century America: Postpone pain. Defer sacrifice. Rob the future to pay the present. Don't raise taxes now, not even to invest in critical infrastructure systems and programs.

Look at state environmental investment for one key indicator of political short-sightedness. The governor and the General Assembly have decided to ease the pain of overall deficit reduction by diverting as much as $64 million from funds dedicated to Program Open Space and agricultural land preservation.

Why have they snitched virtually all the money from those state programs? Because it was there. These cookie jars were full. They couldn't resist the temptation.

Twenty-one years ago, the state inaugurated Program Open Space to address the environmental impact of rapid population growth and increasing suburban sprawl. At that time, planners foresaw that real-estate development would inexorably chew up Maryland's countryside.

The program was designed to balance that destruction by purchasing and preserving an amount of land roughly equal to the acreage lost to new subdivisions and other development. Since 1969, the program has quietly purchased about 550,000 acres of Chesapeake Bay wetlands and access parcels, greenways, endangered species habitat, wildlife-management areas and park land.

The state finances Program Open Space by dedicating the revenues from a 1/2 -percent transfer tax on all real-estate transactions. But in 1984 the Hughes administration relieved a tight budget by "capping" the transfer tax's contribution to Program Open Space. Since then, the excess ($38 million last year) has been siphoned off into the general fund. In six years that cap has cost the program over $200 million, and the rate of land acquisition has fallen almost 100,000 acres behind schedule.

Only a year ago, the General Assembly recognized that the cap had damaged a valuable program. The governor and the legislature solemnly adopted a plan to restore the full dedication of transfer-tax revenues to open-space acquisition. That's what they said last year.

This year the governor and the General Assembly have essentially taken everything from the state program for 1991 and 1992, including the accumulated cash balances. Of course, in a dire budget crisis, every program must contribute to deficit reduction. But no other state program has been hit this hard. At present land-acquisition rates, the cuts have set the state program back by at least four years.

The need for open-space acquisition has increased. In the last five years, Maryland's population has grown by 8.2 percent. Developed land has increased by 18.5 percent. The state has already lost half its forests and half its wetlands. Our forests are now disappearing at the rate of 14,000 acres a year, and farmland is going even faster. Since 1985, new construction has consumed 145,000 acres, an area 2 1/2 times the size of Baltimore. At present rates, by the year 2020, one million more Marylanders will use up 626,000 more acres, the equivalent of 11 more Baltimores.

In this session some thoughtful legislators saw an opportunity to restructure Program Open Space's financing. Maryland has historically funded its program out of current revenues. But no one else buys real estate for cash. Everyone uses mortgages. Every other state uses long-term bonds, a mechanism which makes more financial and programmatic sense for real-estate acquisition.

The obvious solution would authorize the state to issue 30-year bonds backed by the transfer-tax revenues. The authority would double the amount of land the state program can acquire, while reducing current costs.

Indeed, last week the House voted to authorize the counties to issue their own bonds with a state subsidy for that purpose. But the House rejected similar authority for the state program. Instead, it "deferred" the issue for review this summer.

There is still some slim hope that the General Assembly will authorize some $15 million in 1992 general-obligation bonds in order to keep the program going. But it has postponed for at least a year building a secure, long-term financing structure to protect the program's vital purposes from the next budget crunch.

This session the legislators simply lacked the political will to incur a little pain now to to enable this program to continue to buy up wetlands, forests, countryside and open spaces for the future. Instead, they will study the problem over the summer.

By then they will come up with some solution that they will say "makes fiscal sense." In the meantime, Program Open Space acquisitions will stop just when real-estate prices have slumped. Then when the governor and the legislature re-fund the program, the recession will have ended and land costs will have soared again.

Tim Baker is an attorney who writes on Maryland and Baltimore.

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