ANNAPOLIS — A coalition of union and civic groups and several Maryland lawmakers has proposals that would help pay for a statewide education plan, centered around restructuring the state tax code.
The 10 pieces of legislation scheduled to be introduced during the 90-day Maryland General Assembly session call for removing tax breaks for special interest groups, lowering income tax rates for families who earn below the $80,000 state median level and resetting the real estate tax exemption limit for wealthy individuals from $5 million to $1 million.
Del. Julie Palakovich Carr (D-Montgomery County) summarized another piece of legislation that would require large, multistate corporations in Maryland to pay state income taxes. Currently, about a third of them don’t.
Palakovich Carr, who plans to sponsor a bill, said the plan could generate $2 billion by 2030 when adjusted for inflation.
“This is a personal issue for me,” she said while alongside other supporters during a Jan. 15 press conference. “My son is going to be enrolling in kindergarten next fall in a public school. This isn’t just a moral imperative upon which the future of an entire generation of children hinges. This is all about the future of our economy.”
The goal is to use the generated revenue to pay for education recommendations presented by the Commission on Innovation and Excellence in Education, also known as the Kirwan Commission, named after the group’s chair, William E. “Brit’ Kirwan, former chancellor of the University of Maryland System.
The commission outlines five policy areas: expand early childhood, hire a more diverse teacher workforce, incorporate college and career readiness, provide more resources for underserved and special needs students and creation of an independent oversight board for accountability.
To help implement the plan, some jurisdictions are being asked to provide more money based on a funding formula. It assessed the two majority-Black jurisdictions of Prince George’s County and Baltimore City must contribute more at $360 million and $330 million, respectively.
The state’s presiding officers, House Speaker Adrienne Jones and Senate President Bill Ferguson, have said legislation would be crafted to lower those figures. The two also served on the Kirwan Commission, but didn’t attend the press conference at the House of Delegates building.
Benjamin Orr, executive director of Maryland Center on Economic Policy in Baltimore, said county and Baltimore City officials have time because the Kirwan recommendations won’t be immediate.
Orr said there’s a few options local governments can do on how to help implement education plans for their jurisdictions, which would require legislation from the legislature.
First, provide flexibility in earned income taxes. Anne Arundel County Executive Steuart Pittman has floated an idea to implement a progressive tax, or impose higher taxes on more wealthier residents.
Second, Orr said, allow local governments to charge different tax rates on commercial, residential or vacation properties. He said state law requires the same class of property be taxed at the same rate with no subcategories.
A third possible solution would be for the state to provide grants for jurisdictions with a certain percentage of students who are English Languages Learners, enrolled in special education and those who reside in areas with a high concentration of poverty.
“We can either choose not to fix [public education], which I think is unacceptable and both immorally for those students and the economy. Our economy can’t afford to let our future workforce fall behind,” he said. “The second option is to increase our investment in education at the expense of our other priorities health and transportation and public safety, or as we proposed, those most able to pay to pay their fair share so we can actually afford to pay to maintain our investment in health care, to maintain our investments in transportation and increase our investment in education. That’s the only way to do it. We have to find new revenue that’s sustainable.”
Maryland Gov. Larry Hogan supports some of the Kirwan Commission ideas, but has said he won’t support residents paying new taxes to help fund the plan.
However, he did propose legislation Thursday, Jan. 16 to provide tax relief for up to 230,000 Maryland retirees. The Retirement Tax Reduction Act would exempt retirees with an annual income of $50,000 or less from paying state taxes.
The plan would be phased in over a five-year period. The governor estimates it would provide more than $1 billion in tax relief for retirees.
“I will continue to fight to make it easier for Maryland families, small businesses and retirees to stay in our state and to make it easier for all Marylanders to keep more of their hard-earned money,” he said.
Meanwhile, Hogan and his budget secretary David Brinkley said they haven’t seen the details of the revenue tax plan from the coalition.
Del. Stephanie Smith (D-Baltimore City), who plans to sponsor a bill on the revenue plan, has a few words for those who believe there isn’t enough money to fund education.
“I’ve never heard anybody say we don’t have enough money to put someone in prison,” she said. “If you look at the state’s annual contributions to incarcerating people that they fail to properly educate in the first place, we are actually wasting money.”