Maryland counties will face a loss of tax revenue if they fail to keep up their required levels of education spending under a deal agreed to by the Maryland House and Senate.

The House Ways and Means Committee decided last night to accept the Senate version of a bill to enforce what is known as the state's "maintenance of effort" rule -- essentially a requirement that counties keep up their education spending to match increases in state aid.

The vote in the panel was 12-5, along party lines, an indication the bill will have little difficulty passing in the full House. If the House passes tthe Senate version unamended, as appears likely, it would go directly to the governor for his signature.

The bill, one of the most important taken up by tthe General Assembly in this year's session, represents a fundamental shift in the balance of power between the state and the counties. It would let the state, under extreme circumstances, withhold piggyback tax revenue from a defiant county government and send the funds directly to the jurisdiction's school board. Previously, the state's only option was to withhold future education aid -- a sanction lawmakers considered counterproductive.

At the same time, it would give five counties that operate under property tax caps imposed by voters the option of overriding those limits for the purpose of maintaining education spending.

Del. Anne Kaiser, a Montgomery County Democrat who was one of the architects of the legislation, said the bill also spells out a new waiver process for counties seeking relief from the state formula requirements. She said the process will give credit to counties that implement cost-savings measures and will reward counties that have historically exceeded maintenance of effort requirements.

Counties that are currently facing potential penalties would have them waived.