More Debt for You

Marc Kilmer Oct 3, 2012

As a Maryland resident, your share of the state debt is $14,023. That figure comes from a report put out by State Budget Solutions. This is a timely report considering that the Capital Debt Affordability Committee recommended the state take out an additional $150 million in bonds in Fiscal Year 2014. Our state seems addicted to debt spending, and the debt these politicians impose on us is going for some very questionable things.

There is nothing necessarily wrong with the state going into debt to pay for things. For projects that will have benefits well into the future, it makes sense not to burden today’s taxpayers for the benefit of tomorrow’s state residents. Schools, roads, and many infrastructure projects fit this criterion. However, as the Maryland Reporter points out, “Among its budget-balancing techniques in recent years, Gov. Martin O’Malley has beefed up the general fund by taking money out of special funds supported by dedicated taxes, such as the Open Space Program and the Bay Restoration Fund. He has replaced the money with bonds to support those programs.”

Let’s leave this sort of budget trickery aside. Even some of the legitimate bricks-and-mortar projects funded in the capital budget (for which state borrowing pays) are questionable. Take one of the items specifically mentioned during the Capital Debt Affordability Committee meeting – a new library at Salisbury University. I live near SU and have used its library many times. Perhaps the college needs a new library, although I haven’t noticed that this is a pressing matter. However, from what I have heard delegates and university staff say, this new library is essentially a pork barrel project of one local legislator – Del. Norm Conway, the chairman of the House Appropriations Committee. It’s great to have a new library at SU, but at time when the state was facing a supposed budget doomsday, is it really necessary to borrow $104 million for one?

In fact, a lot of money being borrowed is being borrowed based on political considerations, not on real need. Legislators introduce bond bills to borrow money to fund projects in their districts. These projects are essentially earmarks – legislators steering our tax money to certain special interest groups. They aren’t approved because they have met some test for need but are approved simply to please a certain legislator. Many of these bond bills make it into the final capital budget.

So why did the state need to raise its borrowing limit? To pay for special interest projects like these:

  • $250,000 for the Ocean City Center for the Arts
  • $250,000 for the renovation of the Shiplap House in Ann Arundel County
  • $150,000 for the Port Discovery Children’s Museum
  • $100,000 for a statue of baseball player Brooks Robinson
  • $25,000 for a southern Maryland carousel

The list could go on and on. Many of these projects sound worthy. There is an argument that most of them should be funded by government. Take the $365,000 that was approved for the Roger Carter Recreation Center in Howard County. Many counties have recreation centers, and I’m sure this one benefits the residents of Howard County. Maybe it even needs to be replaced. However, why are state taxpayers replacing it? I guarantee that almost all of the people who will benefit from this center live in Howard County. The taxpayers of Somerset County or Prince George’s County shouldn’t be burdened with funding this recreation center. If the people of Howard County want this center, fine, but they should pay for it and not ask the rest of the state’s taxpayers to subsidize their recreation.

Maryland’s state debt is something to be concerned about, both for its size and the things it is funding. Unfortunately, in the discussion of state spending, this issue is often overlooked. Comptroller Peter Franchot, who sits on the debt committee, spoke out against increasing the state’s debt limit. He was outvoted 4-1. Let’s hope more people in Annapolis start sharing his worries.