One of the last pieces of legislation former Speaker Mike Busch passed before he died could be in jeopardy of reversal if the Budget Reconciliation and Financing Act passes unamended.
In seven lines of a 35-page bill, Gov. Larry Hogan seeks to repeal a bill that requires the state to pay the city of Annapolis at least $750,000 annually for services provided to the state including hosting 90-day legislative session, often cited as an exchange for not paying property taxes on any of the 59 state-owned buildings in the city. Starting in the fiscal year 2022, that number would be tied to inflation.
As it is drafted, the BRFA would reverse Busch’s bill entirely, said Nicholas Peppersack, a spokesman for the state budget office. It would set the PILOT payment at $367,000, and eliminate the requirement for the payment to increase with inflation. The purpose of the Budget Reconciliation and Financing Act is to make statutory changes — or mandates to state law that can help balance the state budget, Peppersack said.
When asked about changing the recently passed law, Secretary of the Department of Budget and Management David Brinkley said in an email, "We funded the PILOT at levels consistent with previous years when there was a request.”
Annapolis officials have cited this money as important in restoring expenses when handling state-focused issues like security for the governor’s inauguration. Upon the release of Hogan’s budget bills, Annapolis Mayor Gavin Buckley sent a letter to the Maryland General Assembly. In it he wrote that if the state does not restore the full $750,000 Busch outlined in the bill that passed last year, “the city will have to consider what services it is able to provide to both the State and to the residents and taxpayers of the City of Annapolis.”
Without this money, he wrote, the city of Annapolis would struggle to pay for more school resource officers at Bates Middle School, or mobile health units to provide care to vulnerable communities. His letter also outlined the costs of law enforcement, costs incurred for the governor’s inauguration and costs related to road maintenance and snow removal which he said are not reflected in the $750,000 estimate.
Busch’s bill gave structure to a system that previously left the payment sum up to the governor, and more than doubled the $367,000 that the state paid the city of Annapolis for each of the previous 13 years. Busch said last year that he’d worked with the city to come up with a fair number that was reflective of the actual costs incurred for “fire, police, EMS, waste collection, snow removal — all those type of services that the city provides here in the city of Annapolis while we are here in the 90 days and quite candidly, year-round.”
Buckley testified alongside Busch last year when the bill was first introduced.
Shareese Churchill, Hogan’s press secretary, said in an email to The Capital that funding for PILOT is at historic levels.
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“On top of the PILOT,” she said, “we are proposing $700,000 for stormwater and flood mitigation at City Dock—a project that is being funded largely by the state-$191,000 for additional improvements at City Dock, and $1 million to assist Historic Annapolis.”
Hogan did not sign Busch’s bill — which passed through both houses last year — but he also didn’t veto it. It became law through language in Maryland’s constitution that enacts a bill if the governor does not return it with objections within six days — excluding Sundays.
Sen. Sarah Elfreth, D-Annapolis, said she was frustrated and disappointed to see that Hogan sought to repeal Busch’s bill.
“I think everybody agrees that the city of Annapolis is a wonderful host to the General Assembly and state government and its ability to do that is connected to the funding (from) PILOT,” said Elfreth, who cross-filed Busch’s bill in the Senate last year.
She intends to rally her colleagues, amend the language and restore Busch’s intention.
Elfreth said it was important to note that funding for the PILOT program comes out of the operating budget, whereas funding for flood mitigation and other projects come out of the capital budget — which are different aspects of state funding.