OCEAN CITY— Gov. Larry Hogan and county officials said they plan to continue to work together to fully restore state aid to local roads projects despite the fact that a campaign promise made last year failed to come to fruition.
A year ago, Hogan was the Republican nominee when he stood in front of a gathering of county leaders from around the state and promised to fully restore hundreds of millions of dollars in highway aid. Local jurisdictions have seen an almost 95 percent reduction in that money since 2007 as former Gov. Martin O’Malley and the General Assembly used the funds to close ongoing structural budget gaps amid the worst economic downturn since the Great Depression.
The Hogan administration returns this week to the annual Maryland Association of Counties convention having not fulfilled that promise to reinstate a historical 70-30 split of highway user revenue that comes from sources such as the gasoline tax and motor vehicle titling fees.
“We didn’t get to where we are overnight and getting back to where we should be won’t happen overnight, either,” said Doug Mayer, a Hogan spokesman.
At its high point in 2007, local governments were receiving roughly $700 million in state aid for road projects. This year, those same jurisdictions will split about $170 million with the lion’s share going to Baltimore City. The remaining counties split roughly $26 million, with another roughly $22 million being split among roughly 160 municipalities.
Hogan took a small step toward fulfilling the campaign promise earlier this year by adding an additional $25 million in state aid for local road construction and maintenance. He also proposed legislation that would have phased in a return to the traditional split over an eight-year period, starting in July 2016.
That House and Senate versions of the bill died in committee.
The legislature similarly rejected a bill sponsored by Sen. Roger Manno, D-Montgomery County, that would have phased-in the same split over a four-year period, starting July 1.
“Clearly we have to work back up to that 30 percent,” said Doug Mayer, a Hogan spokesman. “There are still some people who want to stick with the status quo.”
Todd Eberly, a political science professor at St. Mary’s College of Maryland, said the governor’s promise to restore the highway funding may have come into conflict with an even bigger pledge made by Hogan — taming the state’s structural deficit.
“When you make promises in a campaign and get elected you have to think about which you are going to fulfill immediately and which ones you can put off a while,” said Eberly, adding that the structural deficit was always going to be the larger issue used to judge Hogan. “In the end, it’s possible that there was a calculation made that potential hit was not that high a price tag compared to the structural deficit.”
Hogan staffers declined to talk about the challenges of restoring the aid.
Eberly said such hesitance is not uncommon in the first year of an administration and compared it to President Bill Clinton, who won his first presidential campaign in part on the promise of a middle-class tax cut. Once in office, Clinton convened a panel to study the tax cut and then deferred on those plans, saying it would be much more difficult than he first anticipated.
“You just don’t do that,” Eberly said. “It might be honest, but it’s an honesty people don’t respond well to.”
In the end, Hogan still has opportunities to fulfill the promise by restoring the money in his second or third year budget — something members of the counties association say they hope he will do.
“If something is not in this year’s budget then he has to put it in the third year or admit he didn’t follow through on it,” Eberly said.
Del. Tawanna P. Gaines, D-Prince George’s County and chair of the House Appropriations subcommittee on transportation, said it’s unlikely the traditional revenue split will return.
“Everybody should be pretty used to this but they’re all saying, ‘We want to go back to the way it was, we want to go back to the way it was,'” Gaines said. “This is the new normal.”
Gaines said counties need to look to themselves to find the revenue for maintaining roads, and that might include tax increases. She said some jurisdictions have given tax cuts and others have room under the cap for local piggyback income tax rates.
“I know no one wanted to do that during the economic downturn but we’re outside that now,” Gaines said. “Everything goes up. Counties have to make adjustments. They have options. I’d like to see a more permanent split. There may be some room for a modification but it won’t be a 70-30.”
Michael Sanderson, executive director of the counties association, said members were “disappointed that it didn’t happen in (Hogan’s) first budget.”
But so far, the disappointment hasn’t turned into a fault line between the governor and county government leaders.
“I think there is a willingness to cut him some slack on the specifics as long as he’s committed to getting there and his administration continues to say they are,” Sanderson said.
“He’s still singing the song we’re interested in hearing, whether it means it happens in a year or over multiple years,” Sanderson said.