Category Archives: Marc Elrich

Elrich to Hogan: Let the Music Play

By Adam Pagnucco.

In a retort to County Executive Marc Elrich’s decision to not follow the state’s phase 3 reopening of businesses, Governor Larry Hogan’s office has released a letter written by Elrich asking the governor to relax restrictions on live entertainment. Specifically, Elrich asked Hogan to allow live entertainment, which was at that time prohibited, in front of audiences of 50 or less people. Hogan’s phase 3 reopening, which is scheduled to take effect tomorrow, allows live performances with audiences of 50% capacity or 100 people indoors and 50% capacity or 250 people outdoors, whichever is less.

Elrich’s defense of the live entertainment industry will be appreciated by musicians, comedians, actors and other performers. But those in other industries that are affected by the county’s refusal to follow the state into Phase 3, such as retail and religious establishments, will inevitably ask: what about us?

Elrich’s letter to Hogan appears below.

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End of the Line for Kleine

By Adam Pagnucco.

Chief Administrative Officer Andrew Kleine, who admitted to two ethics violations and attempted to cure them through a $5,000 payment and other remedies, has resigned. County Executive Marc Elrich has announced that former State Senator and current budget director Rich Madaleno will succeed him subject to confirmation by the county council.

Originally, Kleine was set to remain in his position. Bethesda Beat reported this on July 7:

County Executive Marc Elrich, in a statement to Bethesda Beat on Monday, wrote that Kleine is a “committed public servant” and that the CAO’s agreement with the Ethics Commission “resolves the matter.”

“Andrew has acknowledged that his actions were an error in judgment and has accepted responsibility for his actions,” he wrote. “I appreciate that Andrew has cooperated with the Ethics Commission’s investigation from the very beginning to resolve this situation.”

But the matter was far from resolved. On July 28, the county council discussed the ethics report and erupted with fury. Multiple council members vowed to obtain more information about the issue, guaranteeing that it would not die as long as Kleine remained. That forced Elrich’s hand and resulted in today’s announcement, the first resignation of a MoCo Chief Administrative Officer due to ethics issues that anyone can remember.

Elrich’s press release appears below. If there is a severance package, the release does not mention it.

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County Executive Marc Elrich Nominates Budget Director Rich Madaleno to Serve as New Chief Administrative Officer Following Andrew Kleine’s Resignation
For Immediate Release: Wednesday, Aug. 12, 2020

County Executive Marc Elrich today announced that he will nominate Richard Madaleno as the Chief Administrative Officer (CAO) for Montgomery County. Madaleno’s nomination follows the resignation of Andrew Kleine, who has served a CAO for the first 20 months of the Elrich Administration. Madaleno will begin serving as acting CAO on Aug. 16.

County Executive Elrich expressed appreciation for Kleine’s many contributions to the County Government. “During his time as CAO, Andrew Kleine led the County Government’s effort to reorganize services ranging from public safety to technology services,” said Elrich. “He championed a Turn the Curve initiative to empower County employees to rethink and improve the delivery of services to our million-plus residents. Over the past five months, he has played a critical role in our community’s response to the coronavirus pandemic. I thank him for his many contributions and wish him well in future endeavors.”

Madaleno, who is serving as the Director of the Office of Management and Budget, is a lifelong Montgomery County resident. He has spent his career serving the people of the County in leadership roles at the County and the State levels and had a long career as an elected representative for Montgomery County in the Maryland General Assembly. He served from 2003-2007 in the Maryland House of Delegates and from 2007 to 2019 as a State Senator representing District 18. While in the Senate, Madaleno was the Vice Chair of the Senate Budget and Taxation Committee where he was known for his ability to find solutions to some of the most challenging budget problems facing the state. He was a leader in education reform serving on the Kirwan Commission. Madaleno also worked in the County’s Office of Intergovernmental Relations from 1995 to 2002.

“Rich is trusted by community groups and policymakers throughout the County and State for his leadership skills and budgeting acumen, which will serve the County well as we face the most significant challenges of our generation,” said Elrich. “I am confident that his experience and expertise will help my administration deliver on my promise to build a healthy, well-functioning, innovative, equitable and inclusive community for all of our residents.”

The County Executive’s CAO nomination must be approved by the Montgomery County Council. Councilmembers are scheduled to return from their summer recess in Sept.

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Private Schools Caught in Elrich-Hogan Feud

By Adam Pagnucco.

Last November, I wrote about the growing feud between Montgomery County Executive Marc Elrich and Governor Larry Hogan. Back then, the issues were the governor’s proposed Beltway widening project, the dispute about how to fix MoCo’s crumbling public safety communications system, the thin blue line flag that was delivered to a MoCo police station and transportation funding. Some of those issues have faded over time but the general radioactivity between the two men can still melt hazmat suits. And now the feud is threatening to blow up MoCo’s private schools.

According to the U.S. Census Bureau, there were roughly 190,000 people age 5 through 18 living in MoCo in 2018. MCPS K-12 enrollment was 158,101 in the 2018-19 school year, suggesting that about 30,000 students, or almost one-sixth of all MoCo kids, were in private school or home school. The Census Bureau’s County Business Patterns series identified 108 private school establishments in the county with 6,610 employees in 2017. Their combined annual payroll was $322 million.

Private schools are a big deal in MoCo.

Right now, private school employees, parents and students are caught in a tit-for-tat power struggle between Elrich and Hogan. This isn’t the typical sparring that the two do over social media. With the county saying one thing and the state saying the opposite, what are these families and employees supposed to do? If you’re a school and you open, the county could fine you. If you don’t, your own parents could sue you and/or pull their kids from your school.

It’s the worst of all worlds!

The situation calls for the low-key tactics of former County Executive Ike Leggett. Hogan, a good old boy developer and son of a Republican politician, and Leggett, a soft-spoken law professor who had risen from a childhood of poverty, couldn’t be more different. But despite their different backgrounds and beliefs, Leggett understood the powers of the governor and learned how to work him. Leggett succeeded in getting Hogan to back off a campaign promise to cancel the Purple Line and the two worked hand-in-hand to lure Amazon to MoCo. If Leggett had any criticism of Hogan, he kept it private. Leggett took a loooooong time to endorse Hogan’s general election rival, Democrat Ben Jealous, and never campaigned against Hogan. The two became peas in a pod – and an odd-looking pod at that!

The lesson of Leggett is not one of capitulation but of continuing to talk despite areas of disagreement. Leggett never made things personal even when other people wanted to. I wrote many tough pieces on his administration and Leggett would respond by seeing me at an event, shaking my hand and saying, “How are you? Is everything OK? Let me know if you need something.” Then I would feel bad about being so hard on him and I would go beat up someone else for a while!

Leggett, who originally hired current health officer Travis Gayles, would have found a way to work this current dispute out. Working the phones with Hogan and state health secretary Bobby Neall, Leggett and his people would have devised a stringent network to regulate private school reopenings without provoking a legal war with the state. And he would have kept it out of the press. The only sign of discussion would have been mutual praise between Leggett and Hogan of what a great job each was doing on handling COVID. As for the private schools, many would probably have opted for distance learning rather than deal with cumbersome county bureaucracy and plan approvals, thereby producing a similar result to the one desired by Elrich. It just would have happened without yelling and screaming.

Leggett is happily retired from elected service now and is probably laughing as he reads this column. He is still around. Maybe Elrich and Hogan should bring him back, always the calmest guy in the room, to settle their increasingly bitter feud.

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Top Seventh State Stories, July 2020

By Adam Pagnucco.

These were the top stories on Seventh State in July ranked by page views.

1. Restaurant: My Staff Will Not Wear Face Masks
2. MCEA: MCPS Reopening Plan “Wholly Inadequate” to Protect Students and Staff
3. Volcano in Rockville
4. The Upcounty Doesn’t Vote and Nobody Seems to Care
5. Distance Learning May be Plan C, but it is the Best Option Right Now
6. MoCo’s Book Club
7. Elrich on Hot Mic: “Can I Say the Council is Fact Proof?”
8. MCEA President Responds to MCPS Video
9. Kleine on the Line Again
10. MCPS Releases “Just the Facts” Video

The post about a restaurant not requiring face masks was one of the top five most-read stories in the history of this blog. (That puts some perspective on the relative importance of politics!) Marilyn Balcombe and Sunil Dasgupta deserve congratulations for their excellent and widely read guest posts. Aside from those, the top posts generally reflect the top two stories of the month: MCPS’s reopening decision and the county’s ethics-challenged Chief Administrative Officer Andrew Kleine.

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Volcano in Rockville

By Adam Pagnucco.

When the county council met yesterday to consider the case of admitted ethics violator and Chief Administrative Officer (CAO) Andrew Kleine, one word alone can describe what happened: Eruption. Rockville was covered by a black cloud of ash and lava sprayed through the streets as the council held very little back. Montgomery County Government has never seen anything quite like it.

The basics are simple: last year, executive branch county employees (all of whom work under Kleine) complained to the ethics commission about his book marketing and his relationship with contractors with whom he had done private business and then had gone on to help obtain county contracts. After an investigation by the county’s inspector general, Kleine proposed a “cure” which involved the payment of $5,000 and his abstention from outside employment. The ethics commission accepted the cure and the county executive has allowed Kleine to remain as CAO. Seventh State has previously published columns on the issue on July 2, July 7, July 9 and July 27.

Kleine was not present at the council’s meeting, leaving ethics commission chair Rahul Goel and ethics commission staff director Robert Cobb to brief the council on Kleine’s ethics case. Before elaborating on the situation with Kleine, Goel and Cobb suggested a need for mandatory ethics training for all county employees, including elected officials. No one disagreed with that. But the council did not buy that ethics training alone would have prevented Kleine’s actions. What followed was a remarkable and unprecedented display by the council members in which some walked right up to the line of calling for the CAO’s resignation without actually crossing it. Consider these quotes from the briefing.

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Council Member Nancy Navarro

Training is important but how would that have avoided this situation? And it’s one thing for an employee to have done something like this but when it’s the Chief Administrative Officer, that raises for me some concerns because the employees, the county government employees obviously are under the Chief Administrative Officer and it is very difficult with a straight face to say to our employees “you’re going to have to go to mandatory training” when the Chief Administrative Officer himself didn’t seem to understand the basics of ethics and conflicts of interest…

I personally still have some concerns regarding the ability of Mr. Kleine to be the Chief Administrative Officer of our county government when there was such a lapse in judgment regarding something like this.

Council Member Gabe Albornoz

I’m troubled that Mr. Kleine was not put on administrative leave during the course of the investigation and continued in his role as the head of procurement for our entire county through this investigation. I’m concerned that the county executive has not reached out to my colleagues and I to express how his administration has taken this matter extraordinarily seriously, how there has been, I believe, a statement from the county executive but not much more than that in terms of his comments on this particular matter.

Because the ripple effect of a situation like this is profound. What do we say to department heads who are also found guilty of similar violations? That you get one strike? You get a pass the first time around and yes, there is a cure, but the cure for the payment of $5,000 and the retainment of employment is significant in light of what we have seen. And I appreciate those recommendations and I also appreciate the recommendation of additional training.

But the broader question here is trust. And I worked in an executive branch for twelve years and know how important that trust is among colleagues. And I don’t believe enough has been done beyond this cure to repair the damage from the messaging that this sends to all the county government, that this sends to people that deal in their business with county government. And I don’t think quite frankly that this matter has been taken seriously enough by this administration. And that’s a concern.

Council Member Hans Riemer

This whole incident reinforces a concern that I have had about – and I think many people in the county government have had about the chief administrator’s work. The county executive has allowed him to really apply his personal business theory, his personal business practice, “turn the curve,” to his management of the county government. The county executive has required all of our departments to participate in something that really often feels like a demonstration project for a consulting practice. And it often feels like it substitutes jargon for real management initiatives. And that has been weighing on me for a lot of time. And I think that this report just raises some real questions about the continuing of the consulting business and really whether the intended – whether the chief administrator’s success is the county’s success. And I think that that is weighing on a lot of people and department heads and managers. And I think we do have an issue. We need to restore the confidence of this county government in the leadership of the executive branch.

Council Member Craig Rice

At the end of the day, this falls on the county executive. The county executive wants to continue to have the number two person in charge be a person who has committed serious ethics violations, that’s a choice he’s going to have to justify, that’s a choice that he’s going to have to stand up and say this is why he feels as though it’s comfortable to have this person still in charge in a leadership position.

Council Member Andrew Friedson

Public trust is the only currency that we have in public life. It’s all we have in terms of our ability to govern, and to me, this speaks directly to public trust. And it’s why I share many of the comments of colleagues of how disturbed and disappointed I am by the contents of the ethics report because that’s what this speaks to. And it’s not a member of the county government, it is not some county employee, it is the top county employee, the person who is in charge of running the government. And I speak similarly to comments that were made about – the comments about training. This is not a training issue. Let’s not obscure what happened here. This is specifically a clear violation of ethics and of public trust. That’s what it is. It is a massive, massive failure of judgment in the highest position in county government…

When we talk about this as being a cure, it’s kind of a euphemism. What this really is effectively is a plea agreement.

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Volcanic eruptions can be hard to survive due to their pollution of the atmosphere, the danger of lava flows and the potential for subsequent discharges. In this case, the repeat discharge potential is real with multiple council members asking whether Kleine received special treatment (a subject for another time!) and requesting more information. Lava, like water, can drip drip drip.

With the council’s eruption threatening to bury the executive branch in a blanket of burning ash, the big question now is: why has the county executive allowed Kleine to stay? And will that continue?

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Ficker vs Friedson vs Elrich on Property Taxes

By Adam Pagnucco.

In an open meeting tomorrow, the county council will consider placing two charter amendments limiting property taxes on the ballot along with an amendment by Robin Ficker, which has already qualified. Let’s compare the three proposals – Ficker’s, one by Council Member Andrew Friedson and his colleagues on the council’s Government Operations Committee and one by County Executive Marc Elrich – to current law.

What would be limited?

Current charter limit: An annual growth limit is applied to the total dollar volume of real property tax collections.

Ficker: Same as current charter limit.

Friedson: A limit would be applied to the weighted average tax rate on real property.

Elrich: A limit would be applied to the real property tax rate but there is a lack of clarity on which rate. It could apply to the general property tax rate, which all county residents pay. Or it could apply to the weighted average tax rate, which includes both the general tax and many other smaller property taxes that are specific to function and/or geography. This issue needs to be decided one way or the other if this proposal appears on the ballot.

How would the limit be applied?

Current charter limit: The annual growth in the total dollar volume of real property tax collections is limited to the growth rate in the Washington-Baltimore consumer price index in the previous year. A few categories of property are exempted from this limit (notably new construction during the fiscal year).

Ficker: Same as current charter limit.

Friedson: The weighted tax rate on real property would not be allowed to increase without a unanimous vote of current council members.

Elrich: The property tax rate (whichever option is picked) would not be allowed to increase without a vote of two-thirds (six) of the council members.

Is there a waiver?

Current charter limit: Yes. The limit may be exceeded if all current council members vote to do so.

Ficker: No. The limit on property taxes is absolute (subject to state law).

Friedson: Yes. The limit may be exceeded if all current council members vote to do so (as in current law).

Elrich: Yes. The limit may be exceeded if two-thirds (six) of the council members vote to do so.

Are there disproportionate impacts on different taxpayers?

Current charter limit: No.

Ficker: No.

Friedson: No.

Elrich: Yes. The taxable value of owner-occupied residential property would be allowed to increase at a maximum rate of 3% per year. Other types of property would not be subject to this limit.

Who wins and loses under each option?

That depends on who you are and what your interest in taxes is.

People who depend on county services (other than schools) lose the most under the Ficker amendment, which ties the growth in property tax receipts to the rate of inflation. Inflation is low and might even be negative this year. If the Ficker amendment passes, it will raise the possibility that property tax collections will screech to a halt with limited ways to deal with that.

Groups favoring tax increases gain the most from the Elrich amendment because it lowers the threshold of breaking the tax limit from all current council members to two-thirds (six) of the council members.

Homeowners might benefit from the Elrich amendment, which limits annual tax bill growth on their principal residences to 3%. However, council staff pointed out that the average annual growth in residential assessments exceeded 3% only twice in the nine-year period of FY11-19.

Owners of commercial property and renters of both residential and commercial property will be disadvantaged under the Elrich amendment because they won’t get the 3% growth limit that homeowners will. Over time, the tax burden will shift away from homeowners and onto commercial entities and renters – including residential renters. This is exacerbated by the fact that the Elrich amendment makes property tax increases easier as stated above.

For stakeholders in MCPS’s operating budget, the entire discussion is irrelevant. That’s because a change to state law in 2012 allowed counties to ignore charter limits for the purpose of dedicating funding to approved budgets of local school boards. Since state law trumps county charters, no charter amendment can stop the council from passing a dedicated tax for MCPS. The Elrich administration included such a dedicated tax in its recommended FY21 budget but the council opposed it.

Ficker’s amendment looks to be headed to the ballot because it received enough petition signatures to qualify. We shall see what, if anything, the council decides to put on the ballot along with it.

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Kleine on the Line Again

By Adam Pagnucco.

Nearly a year ago, I wrote a column called “Kleine on the Line” about the county’s embattled Chief Administrative Officer (CAO), Andrew Kleine. Back then, I wrote:

Andrew Kleine is a smart guy with interesting ideas and a lot to offer. But we are now at a big moment. The chief administrative officer is the single most critical non-elected employee of county government. He or she must be beyond reproach and in total alignment with the county executive’s priorities.

The controversy over Kleine’s former business partner and his book sales, as well as the scathing letter from the unions, calls into question whether this is the case with Kleine. [County Executive Marc] Elrich must resolve these issues one way or another or his administration will pay the price.

A year later, Elrich has paid a price in the form of a searing report by the ethics commission and the inspector general detailing how Kleine steered county contracts to his business partners and converted county government into a book club. Now Kleine really is on the line as the county council is due to discuss his ethics problems in an open meeting tomorrow.

The ethics commission report by itself would generate harsh consequences in any other administration. But it is not the only issue with regard to the CAO’s record. Kleine described implementing Elrich’s campaign-era “90 Days Financial To-Do List” as one of his top priorities in November 2018, but numerous promises in that list have gone unfulfilled or under-fulfilled. The list included a ten-year financial plan (not done as of the FY21 budget), a “structural review of all departments in partnership with the county’s unions” (where is it?), an innovation fund (cut back from a $2 million request last year to one $71,545 software project) and a promise to “introduce or strengthen mechanisms that hold county leaders accountable to both other employees and to the public.” That last one reeks with irony.

There is more. Restructuring in cooperation with the unions was a major Elrich campaign promise, but since the unions have put their objections to Kleine in writing, whether this can be completed with Kleine having any part in it remains in doubt. The CAO’s office would normally have a role in approving department head nominees and the nominations of Vennard Wright (technology services) and Tonya Chapman (police department) were both train wrecks due to lack of vetting. The administration’s two-year budgeting initiative, with which Kleine was directly involved, was resisted by the county council and made no appearance in the FY21 budget. And it’s unclear whether Kleine was directly involved with the $10 million “magic asterisk,” the illegal negative appropriation in the executive’s recommended budget intended to account for phantom savings from “cost efficiencies.” But if he did have a role in it, add that to the above list.

The CAO preaches “outcome budgeting” in his book and elsewhere, but given the above record, what has been done that has yielded a positive, documented and significant financial benefit for the county?

Now let’s put all this into context. At the time of Kleine’s arrival in county government towards the end of 2018, two other events were occurring. First, Kleine’s predecessor – 12-year CAO Tim Firestine – was leaving. Unlike Kleine, who had never worked in MoCo government before, Firestine had been with the county for nearly 40 years. Before he was CAO, he was the county’s highly regarded finance director for 15 years. He was well known and well respected in both the executive and legislative branches. Firestine wasn’t warm and cuddly, but no one disputed that he was honest, competent and totally uninterested in self-promotion. He left very big shoes to fill.

The other huge event was the revelation that former economic development official Peter Bang had stolen $7 million from county government. The news was arguably the biggest scandal in county history and shocked people who had worked with Bang, who cultivated a reputation as a sharp dressing, no-nonsense professional. In the aftermath of Bang’s arrest, ethics became an even higher priority in a government that prided itself on avoiding the municipal corruption that so often plagues other jurisdictions in the region.

Into this arena descended Kleine, who immediately set out to direct county contracts to his private business partners and began promoting his book throughout county government and beyond. Bear in mind that 99% of county employees knew little or nothing of Kleine when he arrived. This was the first impression he was making on them. Say what you will about MoCo government, but it is full of professional, experienced and dedicated people – both managers and rank-and-file – who would never think of going anywhere near a conflict of interest. How did they see Kleine’s behavior? We don’t know how all of them saw it, but we do know from the ethics report that employees from two different county departments went to the ethics commission to complain. If these employees are still in county government, they are still working for Kleine even after he admitted to violating two sections of ethics law.

There has been no allegation of criminal activity by Kleine but he is guilty of extremely bad judgment that went on for months. How can he remain in his current role? He is the administrative head of county government. The next time he appears before the county council (in person or virtually), he has to know that all nine of them will be thinking about his ethics violations. The same goes for his own employees. Is there a senior manager anywhere in county government who has not read the ethics report? How can Kleine command the respect and good will any CAO needs to run the government?

The other question here is: where was Elrich? In the spring of 2019, rumors were everywhere about Kleine’s book promotion and his contractors. Was Elrich completely unaware of what was happening or was he aware and saw nothing wrong with it? Neither scenario is appealing. Kleine is the most senior non-elected person in the administration and reports to only one person – Elrich. If Kleine remains CAO after a slap on the wrist, it’s an open question as to whether Elrich is capable of firing anyone – or even disciplining them – for misconduct. What impact will that have on the culture of the executive branch?

That brings us to the county council, which is due to discuss Kleine at an open meeting tomorrow. The council can’t discipline Kleine directly – that is the prerogative of Elrich alone. But the council’s views on Kleine relate to a major theme of this term: the council’s lack of respect for the Elrich administration. The council has voted down Elrich’s labor agreements, rejected his approach to fixing the county’s balky public safety communications system, rejected his tax hike proposal (on the very day he offered it), rewritten his second budget, rejected his first nominee for police chief, passed its own set of health regulations in protest of his performance on COVID testing and regularly ignores his input on legislation. Then came Elrich’s hot mic joke that the council is allegedly “fact proof,” which drew harsh responses from Council Members Nancy Navarro and Gabe Albornoz. It’s hard to imagine the council having an even worse opinion of the administration, but if it comes to believe that Elrich tolerates unethical conduct, his influence will dwindle to zero. That’s obviously bad for Elrich. It’s also not so great for the daily function of county government.

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Navarro, Albornoz React to Elrich Hot Mic Joke

By Adam Pagnucco.

Council Members Nancy Navarro and Gabe Albornoz have issued statements on Facebook regarding County Executive Marc Elrich’s hot mic joke about the council being “fact proof” while he was discussing Latino COVID-19 infection rates.

Navarro went first with the following.

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Wow! This is no laughing matter. These are not just numbers, these are people. The fact is that this pandemic has disproportionately affected our Black and Latino community. At this moment we know that the Latino community is particularly disproportionally affected, they admit this in this video. Some of us have been working around the clock from the early days of this pandemic, pointing this out and offering solutions that have not been implemented by this administration. I take issue with the cavalier attitude and the disrespectful manner in which the Council and this community is addressed in these comments. Ya basta! Que vergüenza!

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Editor’s note: Ya basta roughly translates as “enough is enough.” Que vergüenza roughly translates as “what a disgrace” or “what a shame.”

This is Albornoz’s statement.

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I did not find the County Executive’s comments on this video funny or amusing. In fact, I found them deeply troubling and the reaction of his senior officials disappointing. It’s also disappointing that the County Executive does not have a better understanding or command of this situation.

These are the facts:

• Over 70% of positive test cases in the month of July are Hispanic, continuing a trend upward, when all other demographics of test positive cases are trending down.

• The community and the Council did not see a comprehensive written testing plan until July 13, more than five months after our first test positive case in our County.

• The rapid response teams that were intended to support communities in high impacted zip codes and sectors were disbanded weeks ago and have not been replaced.

• There has not been a comprehensive plan to address the outrageous disparity in positive test cases in the Hispanic community articulated. Worse, there appears to be no urgency to address it. Worst still, based on this video a clear disinterest and condescending attitude.

• The phone number to secure a test in Montgomery County was down for several days last week. That number has been recently overwhelmed with residents leaving repeated messages with no call back.

• We lack a sufficient number of bi-lingual and Spanish speaking operators and contact tracers.

• Our community clinics have not been sufficiently accessed as a resource and activated in communities. The Mary’s Center has repeatedly offered to help to enhance reach in the Hispanic community. Those offers have fallen on deaf ears.

There is no question that we have made progress since the beginning of this pandemic and we are in a much better position than we were before. There is also no question that our public health officials are working hard to address these issues. That being said, these numbers are alarming and must be taken more seriously than it appears this administration is taking them. It is morally imperative that we support our most vulnerable communities, it’s also a public health imperative that we contain the virus in all communities.

I am proud to be working with Councilmember Nancy Navarro and key stakeholders in the community to develop and execute a plan that is desperately needed in the Hispanic community at this moment. I am also proud to have worked with Councilmember Hans Reimer and all of my colleagues to introduce a resolution as the Board of Health to establish key testing bench marks.

I worked for a high functioning Executive branch and a fully engaged County Executive so I know what it looks like. It does not look like the lack of leadership we see in this video.

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Elrich on Hot Mic: “Can I Say the Council is Fact Proof?”

By Adam Pagnucco.

It’s no secret that the relationship between the executive branch and the county council is not one of roses and chocolates. After rejecting County Executive Marc Elrich’s tax hike and rewriting his recommended budget, the council decided that his strategy for COVID-19 testing was inadequate and decided to create one of its own. But such things are positively amorous compared to the council’s likely reaction to Elrich’s joke – recorded on a hot mic – that the council is “fact proof.”

The joke was made during a Facebook video of Elrich and some of his top staffers preparing for a media briefing earlier today. The preparatory discussion should not have been shown, but it was – and eyeballs were on it. Elrich, county health officer Travis Gayles and county emergency management director Earl Stoddard were talking about how to discuss COVID-19 infection rates among Latinos in the wake of a Washington Post article on disproportionate cases in that community. So far, so good – public health data has multiple layers and is not always easily conveyed in casual discussion, especially in the press.

But then Elrich’s delightfully snarky sense of humor kicked in as Facebook viewers watched. At 3:15, Elrich cracked, “Can I say the council is fact proof?” Gayles laughed and replied, “You’re welcome to say whatever you want to say!” Stoddard followed with, “I’m not sure how helpful it is, but you could say it!” As of this writing, the video has been removed – but not before it was recorded.

Elrich is a funny character when he wants to be and he has to be frustrated with the council. But I guarantee that no one on the council is amused. Given the immense powers the council possesses under the charter and its demonstrated willingness to use them against the executive, the council might just get the last laugh.

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Elrich Charter Amendment Would Make Tax Hikes Easier

By Adam Pagnucco.

A document written by a special assistant to County Executive Marc Elrich lays out the administration’s views on the county’s charter limit on property taxes. And its approach is a simple one: make tax hikes easier.

The county’s charter limit on property taxes was approved by voters in 1990. In simple terms, it allows the county’s total volume of property tax collections to rise annually at the rate of inflation (with a few exceptions like new construction) unless the county council votes to override the limit. Under the original 1990 law, the limit could be overridden with a vote by seven council members. In 2008, tax activist Robin Ficker passed a charter amendment raising the override requirement to nine council votes. Two years ago, voters passed another amendment changing the override requirement to a unanimous vote of all current council members, a change designed to deal with council vacancies. Ficker has qualified another amendment to the charter this year which would revoke all overrides of the limit if approved by voters.

Elrich made his dislike of the current charter limit structure plain in his most recent recommended budget. In his budget message, Elrich wrote:

When the County Council proposed to the voters our current Charter limit on property taxes in 1990, few people could have foreseen the dramatic changes that would take place in Montgomery County and around the globe. In the past 30 years, our school population has grown by 65 percent and our overall population has grown by 40 percent. The services we provide are now more complex and seek to address a range of challenges, from traffic congestion and climate change to health care disparities and linguistic diversity. And over the past four decades, our property tax rate has declined by 35 percent.

We have all witnessed other local governments regionally and nationally experience generational decline due to conflicting, irreconcilable fiscal policies. Montgomery County is at the precipice of such a decline if we cannot get ourselves out of this cycle of self-enforced structural deficits and inequitable, unpredictable revenue caps. Therefore, I will be sending the Council a proposal for a Charter amendment that will revise our revenue cap to provide certainty to homeowners. This proposal will eliminate our old, cumbersome revenue cap and replace it with a three percent cap on the increase in any homeowner’s taxable assessment. This will give our taxpayers real protection from unexpected increases in property values. It will also provide the County Government with a higher degree of predictable tax revenues like every other jurisdiction in our region.

Without such a change in the Charter, our community could be facing a situation in FY21 where a recession and deflation cripple our ability to provide emergency services and a quality public education system. This perfect storm would threaten lives and diminish the value of properties in our County. I will not stand by and let our community be harmed by the ghosts of voters from four decades ago.

An internal document written by one of Elrich’s special assistants, Debbie Spielberg, lays out the administration’s specific objections to the current charter limit. (Spielberg is the Hand of Elrich. No one in the administration is closer to the boss.) Among Spielberg’s criticisms are that the current charter limit structure does not capture growth in the tax base, is vulnerable to underestimates that affect the taxable base subject to the limit forever and leaves open the possibility of having a zero inflation rate stop increases in collections. Spielberg is right on all of these points. She also alleges that the charter limit has caused MoCo to have a lower property tax rate than most of its neighbors. This point is more complicated. MoCo’s property tax rate was in the middle of the pack for Maryland counties in FY20 and is lower than much of Northern Virginia because those localities do not charge income taxes. Spielberg’s memo is reproduced below.

The administration is fearful of what would happen if voters pass the new Ficker amendment, which would remove the county council’s ability to break the charter limit. Spielberg’s memo proposes an alternative charter amendment that would do three things.

  1. It would apply the charter limit to the property tax rate, not the volume of collections.
  2. It would allow six council votes to raise the tax rate. The current override requirement is a unanimous vote by all current council members.
  3. It would limit the growth in the taxable value of an owner-occupied residential property to 3% per year.

Elrich’s official charter amendment request to the council appears below. The council and the voters – but not the executive directly – can place charter amendments on the ballot.

The obvious impact of this proposal would be to make property tax hikes easier. Instead of one council member being able to block an increase, now four would be required to obstruct it.

The less obvious impact has to do with the distribution of future tax increases. Right now, the county limits the annual increase of taxable assessments on principal residences to 10%. The administration’s proposal would lower that to 3%. That looks good for homeowners but let’s think about the properties that are not principal residences: commercial properties and residential rental properties. If homeowners are shielded from tax hikes, commercial entities and residential renters will pay more. This is a significant policy shift with two consequences. First, it would impede the county’s commercial sector from recovering from the COVID-19 economic crisis. (Let’s remember that MoCo had major competitiveness issues before the virus arrived.) Second, renters – especially low-income residents and small businesses – have been dramatically affected by the current economic downturn. How much more can they pay? Policy makers should think carefully about having them assume more of future tax burdens.

The looming prospect of a new Ficker amendment has generated both this concept as well as another amendment on property taxes now before the county council. (The council’s version would require a unanimous council vote to raise the tax rate and contains no redistribution of the tax burden.) If one or both alternatives to Ficker make it to the ballot, voters will face complicated choices on tax policy. And they will do it during one of the worst recessions ever.

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