Testimony on HB 1247–Constitutional Amendment on Additions to the Operating Budget

House Appropriations Committee

Maryland General Assembly

March 9, 2004

Roy T. Meyers

Associate Professor of Political Science

Director, Sondheim Public Affairs Scholars Program

UMBC

            Mr. Chairman and members of the Committee, thank you for the opportunity to testify. I strongly support HB 1247, but I want to make clear that my views are my own and do not represent the position of my employer. My testimony is based on a long paper that I coauthored this summer with Thomas Pilkerton, a UMBC student. I request that a copy of this paper be entered into the record, and I apologize in advance if it gives you bad memories of heavy college reading loads!

            I also want to state that my support of this bill is nonpartisan. I hope that the incumbent governor will be strong and effective, and that goes for his successors as well. Unfortunately, governors have traditionally opposed this bill, for fear that the bill will weaken them and thus promote fiscal irresponsibility. My central point today is that when one looks at how Maryland’s budget process really operates, that view is mistaken.

            I used to work for the Congressional Budge Office, where it was painfully obvious that the Congress often makes big mistakes while budgeting. When I came to UMBC, I was impressed by Maryland’s record of fiscal responsibility, and initially thought this was due to the Governor’s extraordinary budget powers. But with more study, I learned that these powers have stimulated the General Assembly to follow four undesirable budgetary practices.

            The first is that since the legislature can’t add spending to the Governor’s regular budget year by year, it often adopts mandates for many years of future spending, often without knowing how this additional spending will be financed. This practice should not please fiscal conservatives.

            The second problem is that the legislature also compensates for its weakness by using very detailed directives to influence agency managers. This micromanagement approach is far behind the times–instead, the General Assembly should be spending more time on goal-setting and monitoring agency performance.

            The third problem also reduces flexibility. Under the current rules, the General Assembly can add spending if this spending is supported by specific revenues. While there are sometimes good reasons to dedicate revenues, Maryland does this so often that the budget has far too many separated accounts. This makes it harder for the state to respond to temporary downturns, and to shift funds permanently to the most effective and efficient programs. It also promotes budget gimmickry–such as when spending is funded from so-called “revenue overattainment.”

            The fourth problem is that the since most legislative additions to the budget must wait until the supplemental, that bill now includes much more than just minor provisions, as was originally intended. Instead, its broader contents show that everyone in Annapolis knows that the General Assembly has a legitimate role in adding items to the budget. But these additions receives much less analysis and public scrutiny than they should.

            On this latter problem, I will be blunt. Legislators understandably want to ensure that each of their districts are treated fairly in the budget process. When Governors include many projects in the supplemental, then legislators may feel comfortable enough with the current process to keep it as is. But making deals in back rooms went out of favor in Maryland about three decades ago–the public wants legislators to make decisions in full public view. Nor would the new approach necessarily prolong budget decisions. Requiring both the Governor and the General Assembly to make budgetary proposals earlier in the session reduces the risk of extended sessions. And item vetoes can be handled in one day–the common practice in other states.

            An alternate reason for opposing HB 1247 is the worry that the General Assembly would go “hog wild”--adding wasteful projects right and left until budgetary discipline was busted. This fear of unchecked spending was one reason why the 1916 budget amendment was adopted. Prior to this time, no comprehensive budget existed–neither the legislature nor the Governor knew how all of their individual decisions affected the state’s budgetary position.               

            But that should not have led them to conclude that only the Governor should be allowed to add new spending items. I would prefer the process used in most states, in which the legislature and the Governor must compromise on budget totals and items. But HB 1247 presents an acceptable and moderate alternative, in which the legislature could add spending items, but would be prevented from exceeding the Governor’s recommended budget total. In addition, the Governor would be given a limited line item veto. This is hardly a radical weakening of gubernatorial power. I am certain that none of the governors who have some form of the item veto would agree to give it up.

            Unfortunately, opponents of this bill often rely on a “Chicken Little”-style claim that this bill would endanger Maryland’s AAA bond rating. This is simply absurd. But you should not rely solely on my expertise to predict if the sky is likely to fall. Instead, you should write the three major bond rating agencies and ask them if this bill will risk our top rating. I guarantee that the answers will all be “NO.”

            Some of the influential advocates of the 1916 amendment idolized the British system of government. They believed that only the chief executive could be accountable to the public. But Maryland, like the other 49 states, has an American system of government, in which the separate branches are both expected to represent the public, and to compromise because they share powers. On this point, I want to quote William Allen, an expert opponent of the 1916 amendment. He said:

Nothing could be more unscientific and absurd than to ask legislators to deal intelligently or honestly with executive proposals if the constitution prohibits them from considering at the same time evidence existing anywhere in the state that the governor’s proposals are inadequate.

            I suggest that Allen’s criticism of the 1916 amendment is just as true today, just as it was several years ago, and just as it will be when the state is led by a General Assembly with a Republican majority. Democracy requires that we encourage open debate of reasonable alternatives. This is especially important as the state grapples with its structural budgetary deficit. HB 1247 will point us in the direction of more democracy, and I encourage you to send it to the voters this year.

            Thank you, and I will be glad to answer any questions you might have.