Budget woes might have wide impact

THE BALTIMORE SUN

If Howard's 11 state legislators vote as expected Wednesday to reject a plan to raise $215 million for needed school construction through a real estate transfer tax increase, the county will be facing a challenging new reality.

Among the looming possibilities:

Increases in property and/or income taxes.

A long-term freeze on new development.

Significant cuts in capital spending on highways, parks and long-delayed public facilities.

Classroom crowding that could endanger Howard's reputation for educational excellence.

Some county leaders are urging calm in the face of the grim arithmetic facing County Executive James N. Robey and the County Council.

"Ultimately, the council and executive will do whatever they need to do to fund capital projects," council Chairman Guy J. Guzzone said. "We continue to be hopeful," added Sandra H. French, school board chairman.

Capital spending requests for the coming fiscal year total $203 million, $87 million of which is for school projects. But with the state facing its own budget crisis, $7 million is the most county officials expect from Annapolis. Another $70 million could come from the sale of bonds, the traditional financing vehicle.

Fueling the spending crisis is relentless growth that increased Howard's population by one-third during the 1990s, and has defied repeated predictions of a school enrollment peak, followed by a drop. Each year, seats must be found for an additional 1,000 students entering the 47,000-student Howard school system.

A new high school, four new elementary schools and 15 additions are projected to open by 2006, and 80 new kindergarten classrooms are needed the following year to meet a state mandate for all-day classes.

"Obviously, Robey's going to have to find some revenue stream," said John Taylor, a slow-growth advocate on the county's Adequate Public Facilities Ordinance (APFO) committee who argues developers do not pay their fair share.

Already, school officials are compiling a list of priority projects and some are talking about delaying renovations, or new elementary schools, postponing building maintenance, repairs, or perhaps the $48 million new high school scheduled to open in 2005.

To some who have been working on the problem, the decision to turn away from the transfer tax proposal is inexplicable.

Jim Schulte, a developer and member of APFO, noted that fellow members have occasionally joked that the county would be fine "if we could set up a turnstile at the border and charge everyone admission as they came in" to make sure enough schools and roads were ready.

The transfer tax proposal, which would raise the levy on the sale of new and used homes from 1 percent to 1.5 percent and use the revenue to borrow $215 million and then pay off the debt, would do just that, he noted.

"I thought it was brilliant," Schulte said. "It's just perfect, absolutely perfect. I'm pretty discouraged that the legislators couldn't understand it."

Rosemary Mortimer, a PTA Council representative on the committee, felt the same way.

"Frankly, I'm flabbergasted," she said of the legislators' rejection of what she termed "a very logical idea. I couldn't fathom it. To me it was a no-brainer," she said.

The county's senators, led by State Sen. Edward J. Kasemeyer, a Columbia Democrat, said they favor a broader approach to raising money so that everyone in the county helps pay for schools through the income or property tax, not just those few buying homes in Howard.

But supporters of the transfer tax proposal note that increasing income or property levies will mean higher tax bills every year for everyone, instead of a one-time fee at settlement that only Realtors seemed to oppose.

"I never realized the Realtors in this town have such powerful clout," said Roger Caplan, Howard Community College board president, who testified in favor of the plan at a public hearing Feb. 6.

Instead of working together to solve a problem, he said, the legislators seemed to have their minds made up, ignoring the testimony of a broad range of county citizens and creating a tone he found "more like an inquisition than a discussion," he said. "We need solutions."

Without a solution, things could happen automatically.

If classrooms get too crowded, the county's Adequate Public Facilities Ordinance will kick in, delaying developments planned for 2006 and beyond, when a new high school, three new elementary schools and a raft of classroom additions are supposed to be open.

"I think if the school system's capital budget isn't funded, the county is likely to shut down residential development," said Cole Schnorf, another APFO committee member who is vice president of Manekin Corp., a commercial developer and property manager.

But county legislators seem unimpressed.

State Sen. Robert H. Kittleman said last week he does not trust county figures on the issue. "The books are cooked some way," he said at a delegation meeting Wednesday - something school officials deny.

Del. Elizabeth Bobo said her look at Longfellow Elementary in her district showed new students were indeed coming from sale of existing homes as county officials claimed, but no new construction was needed there to house them, causing her to doubt that older-home sales are part of the crowding problem. She proposed exempting existing homes sales from the tax increase.

The school board has not discussed the situation yet, but school board member Virginia Charles said she feels new seats have to have the highest priority.

"We have to have those seats. Things that are not seats will be what goes," she said.

The new Northern High School represents the single largest item in the fiscal 2004 school budget, with $25 million in construction funding requested.

County Councilman Ken Ulman, a west Columbia Democrat, marked it as the most likely item to cut. But others say the high school must be built.

"The need for the high school has been established over a period of years," said school board member Patricia Gordon. The two newest elementary schools would be more likely candidates for delay in her mind.

Also at risk are the planned renovation of Howard High, with a price tag ranging from $3.8 million to $12 million, and the $10 million planned for a new Cedar Lane School for handicapped children.

"The [priority] list is not going to be much different than it is right now. If you go down that list, our needs haven't changed," said Sydney L. Cousin, deputy county school superintendent.

There are tactical considerations involved in deciding on any budget cut in the $87 million 2004 request, he noted. Cutting the three elementary schools planned to open in 2006, for example, would save only $4.2 million in planning funding in the 2004 budget, though delaying the high school would not affect the APFO law, which does not cover high schools.

"Either way, we have a solution - use relocatable classrooms or some other thing. Anything that's deferred in '04 goes into '05," Cousin said, noting that request is already at $112 million.

Western County Councilman Allan H. Kittleman made it clear that the last thing he wants delayed is the new high school.

"That's a very big deal. The overcrowding's tremendous at Glenelg," he said.

"I think it's way too soon to say we're going to cut $20 [million] to $30 million. We can do a property tax increase as well as an income tax" increase, he said.

Fellow Republican Christopher J. Merdon said he would rather fund school requests and reduce others to a bare minimum, but that could be hard.

If the county does not match state and federal funding for a new community college building and noise barriers along Interstate 95 and U.S. 29, for example, those projects could die.

And since road repaving funds were eliminated last year and the state has already cut $6 million in highway maintenance funds, it will be hard to spend nothing in those areas for two years, officials said.

Other long-delayed projects include a police-fire training academy, a western county senior center, new libraries and development of new county parks including the Blandair estate in the heart of Columbia.

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