Category Archives: Adam Pagnucco

Adam Pagnucco, Economy

Taxpayer Flight from MoCo, Part Four

By Adam Pagnucco.

In Part Three, we saw that MoCo’s problem of taxpayer flight is shared by most jurisdictions in the Washington region.  But what happens when we look at MoCo’s taxpayer inflows and outflows to and from each of its large neighbors?  From whom does MoCo gain income on net?  And to whom does MoCo lose income on net?

We looked at net gains and losses between MoCo and nine other local jurisdictions plus two states.  Let’s start with the two jurisdictions from which MoCo has net gains of taxpayer income: D.C. and Prince George’s.

District of Columbia

Net change in tax returns, 2006-2016: +1,070 (inflow)

Net change in adjusted gross income ($2016), 2006-2016: +$417 million (inflow)

Adjusted gross income of in-migrants ($2016), 2006-2016: $94,696

Adjusted gross income of out-migrants ($2016), 2006-2016: $83,038

Migrant income gap: In-migrants earned 12% more than out-migrants

MoCo almost always drains tens of millions of dollars in taxpayer income each year from D.C.  That’s because it gets more in-migrants from D.C. than out-migrants and the in-migrants make more.  This fits a pattern of young people living in D.C. and then moving to the suburbs as their incomes grow and they are ready to have kids.  However, as D.C.’s economy has improved since the 1990s, the District’s net income flow to MoCo has diminished over time.  In 2015, D.C. even netted a gain of $40 million from MoCo, the first time the District ended up on the plus side of this ledger since this data series began in 1993.

Prince George’s County

Net change in tax returns, 2006-2016: +834 (inflow)

Net change in adjusted gross income ($2016), 2006-2016: +$39 million (inflow)

Adjusted gross income of in-migrants ($2016), 2006-2016: $42,894

Adjusted gross income of out-migrants ($2016), 2006-2016: $42,802

Migrant income gap: In-migrants earned about the same as out-migrants

In the 1990s, MoCo consistently enjoyed positive income inflows from Prince George’s, but that began to change in the 2000s.  In the last fifteen years, MoCo lost money to Prince George’s seven times.  MoCo may still have a slight advantage but it’s very tenuous and could slip away.

Alexandria City

Net change in tax returns, 2006-2016: -346 (outflow)

Net change in adjusted gross income ($2016), 2006-2016: -$7 million (outflow)

Adjusted gross income of in-migrants ($2016), 2006-2016: $78,961

Adjusted gross income of out-migrants ($2016), 2006-2016: $73,304

Migrant income gap: In-migrants earned 7% more than out-migrants

There’s not a ton of migration between MoCo and Alexandria and the two jurisdictions roughly break even, although MoCo’s balance has deteriorated a bit in recent years.

Arlington County

Net change in tax returns, 2006-2016: -1,103 (outflow)

Net change in adjusted gross income ($2016), 2006-2016: -$8 million (outflow)

Adjusted gross income of in-migrants ($2016), 2006-2016: $85,154

Adjusted gross income of out-migrants ($2016), 2006-2016: $72,852

Migrant income gap: Out-migrants earned 14% more than in-migrants

As with Alexandria, MoCo roughly breaks even with Arlington.  Again, MoCo’s balance has gotten slightly worse in recent years.

Prince William County

Net change in tax returns, 2006-2016: -289 (outflow)

Net change in adjusted gross income ($2016), 2006-2016: -$33 million (outflow)

Adjusted gross income of in-migrants ($2016), 2006-2016: $50,076

Adjusted gross income of out-migrants ($2016), 2006-2016: $57,436

Migrant income gap: Out-migrants earned 15% more than in-migrants

Prince William has received small inflows of income from MoCo that have diminished in recent years.  Most people moving between the two counties fall in the lower end of the region’s income distribution.

We will conclude tomorrow.

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Adam Pagnucco, Economy

Taxpayer Flight from MoCo, Part Three

By Adam Pagnucco.

In Part Two, we detailed how MoCo has experienced an exodus of taxpayer income since 1993.  But MoCo is not alone: many large jurisdictions in the Washington region have suffered from taxpayer flight over the last decade.

Below is a chart showing the net change in tax returns for the ten largest jurisdictions in the region.  We show net change for two time periods: the last five years (2011-2016), which include the recovery from the Great Recession, and the last ten years (2006-2016), which include the pre-recession peak, the recession itself and the recovery afterwards.  MoCo ranks nine out of ten in both periods with only Fairfax faring worse.  Loudoun is the only jurisdiction showing significant in-migration in the last five years while D.C. was comparable to Loudoun over the last ten years.

Next, we show the net change in adjusted gross income (AGI), measured in 2016 dollars, over the two periods.  Once again, MoCo is the second-worst jurisdiction in the region with only Fairfax trailing.  Notably, only Loudoun had a net inflow in the last five years and Loudoun, Prince William and Frederick had net inflows in the last ten years.

Finally, we show the average AGI of in-migrants vs the average AGI of out-migrants over the two periods.  In every jurisdiction except Loudoun (during the 2006-2016 period), in-migrant AGI was lower than out-migrant AGI.  MoCo’s gap was the third largest.

This is a bad picture for MoCo and not a very good one for the region as a whole.  What is going on here?

First, as has been previously noted by George Mason Professor Stephen Fuller, the entire Washington region’s economy has slowed down since the Great Recession.  That is reflected in the deterioration of the numbers above between the last five years and the last ten years.  The “new normal” has not been kind to anyone in this area and that includes MoCo.

Second, Fairfax has been affected by taxpayer income losses even more than MoCo.  Like MoCo, Fairfax is a huge county with huge bills to pay and nightmarish traffic congestion.  But Fairfax also shares a long land border with Loudoun, which has grown dramatically in past decades and is currently the nation’s wealthiest county.  Of the $5.9 billion that Fairfax lost to taxpayer flight in the last decade, $2.5 billion went to Loudoun.

Third, in addition to the number of taxpayers leaving on net, MoCo’s problem is the big gap in income between those coming in and those leaving.  One would expect to see such a gap in places like D.C. and Arlington, the two jurisdictions with the biggest income gaps shown above.  That’s because both places attract lots of young people who work in and near downtown D.C. and then move out when they earn more and have kids.  That explanation does not work well for MoCo, which has a much lower percentage of young people in its population than D.C. or Arlington.  And yet MoCo’s gap, which is third in the region, has been significantly bigger than the gaps in Fairfax and Howard, two jurisdictions of similar wealth, in the last five years.

We have seen how MoCo compares to its large neighbors in tax migration overall.  But what about direct inflow and outflow relationships?  To whom does MoCo lose income?  And from whom does MoCo gain income?  We will begin examining that in Part Four.

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Adam Pagnucco, Economy

Taxpayer Flight from MoCo, Part Two

By Adam Pagnucco.

As we stated in Part One, the IRS tracks the inflow and outflow of returns, exemptions and adjusted gross income (AGI) for all states and counties.  Comparable data starts in 1993 and continues through 2016.  Here is what that data looks like for Montgomery County.

First, let’s look at the inflow and outflow of tax returns, which approximate the number of households.

For most years, the number of tax returns leaving has exceeded the number of tax returns entering.  The chief exceptions have occurred during economic downturns, especially in the aftermath of the Great Recession.  We are skeptical of the data for 2015: there is no apparent explanation for the enormous drop in both inflow and outflow in that one year.  We saw those drops in every local jurisdiction we examined and they did not seem to produce huge swings in net changes, as we will see.

Below is the net change of tax returns (inflow minus outflow).

The net migration of tax returns – inflow minus outflow – tends to shrink during recessions but it is almost always negative.  Since 1993, there was only one year when inflow exceeded outflow – 2009, when tax return migration was +658.  In 2016, outflow exceeded inflow by 4,748 returns – the worst year on record.  The migration of exemptions, in and out, has followed similar patterns.

Now let’s look at the migration of adjusted gross income (AGI).  The chart below shows the total AGI of taxpayers migrating into Montgomery County and out of Montgomery County, adjusted for inflation and measured in millions of 2016 dollars.

Outflow has exceeded inflow in every year.  Note, once again, the fluky data for 2015.  Below is the net change, adjusted for inflation, in millions of 2016 dollars.

Every year has seen a net loss of adjusted gross income.  The year which came closest to a wash was 2010, when $24 million was lost.  The worst losses on record were in 2004 ($608 million), 2013 ($697 million), 2014 ($601 million) and 2016 ($672 million).  Over the five-year period of 2011 through 2016, $2.75 billion of taxpayer income left Montgomery County on net.

The IRS data tells one more story.  Thousands of taxpayers enter MoCo and thousands leave MoCo every year.  But on average, those who enter have lower adjusted gross incomes than those who leave.  The chart below shows the average AGI of in-migrants and out-migrants in 2016 dollars.

Since 1993, out-migrants have had greater adjusted gross incomes than in-migrants by an average of 14%.  In the 2011 to 2016 period, the average AGI of in-migrants was $71,707 in 2016 dollars while the average AGI of out-migrants was $83,262 – a gap of 16%.

One can only imagine the impact on the county’s budget when hundreds of millions of dollars in taxpayer income leave every year.

Montgomery County is not the only jurisdiction in the region to see a net exodus of taxpayer income.  We will examine how MoCo compares to its large neighbors in Part Three.

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Adam Pagnucco, Council District 3

The Progressives’ Big Gamble

By Adam Pagnucco.

One of the more remarkable things occurring in MoCo this cycle is the snowballing of progressive groups around District 3 County Council challenger Ben Shnider.  Just look at our latest endorsement chart.  Shnider, who was virtually unknown a year ago, has collected about as many progressive endorsements as much better known politicians like Council Members Hans Riemer and Nancy Navarro, Delegate Ana Sol Gutierrez (running for Council District 1) and Council At-Large candidate Will Jawando.  That’s a challenge for Shnider’s opponent, incumbent Council Member Sidney Katz, but it’s a challenge for the progressive groups too.

Sidney Katz is an odd target for progressives – and basically anyone else.  Consider this: he has been an elected official at the municipal or county levels for forty years and no one dislikes him.  Generations of Gaithersburg residents think of him as Dad, an uncle or Grandpa.  No one would paint him as a conservative – for Heaven’s sake, he voted for a nine percent property tax hike along with the rest of the council two years ago.  He has also voted for nearly every other progressive initiative passed by the council, including more school funding, more non-profit support, bills establishing sick leave and parental leave and almost everything else.

But there is one glaring exception: Katz was one of four Council Members who voted against the 2016 minimum wage bill which was then vetoed by County Executive Ike Leggett.  That bill had incredible symbolic importance for many of MoCo’s liberal groups, who viewed it as a litmus test for determining which elected officials were true progressives.  Katz’s efforts to forge a compromise and get a different version of the bill passed later did not mollify the left.  For them, the damage was done.  And someone’s head had to roll.  But whose?

Four Council Members – Katz, Roger Berliner, Nancy Floreen and Craig Rice – voted against the first bill and Leggett vetoed it.  Leggett and Floreen are term-limited and retiring.  Rice has only token opposition in his Democratic primary.  Berliner is running for Executive, an election in which progressive groups would be aligned with minimum wage lead-sponsor Marc Elrich regardless of the bill vote.  That left Katz, the only opponent of the original bill against whom the left had a clear shot.  And in Ben Shnider, the left has a challenger who is appealing, smart, hard-working, experienced in campaigns and an unquestioned progressive.

SEIU Local 500, a lead player in advocating for minimum wage hikes at the state and county levels, was the first major progressive group to endorse Shnider.  Many more followed, including SEIU Locals 32BJ (janitors) and 1199 (health care), Progressive Maryland, the Laborers, Casa in Action, the teachers and more.  The Sierra Club’s endorsement of Shnider was probably connected to another vote of Katz’s, this time against a bill banning pesticides.  Katz is supported by the police and fire fighters unions, the volunteer fire fighters and the apartment and office building owners.  MCGEO is the largest progressive group to not yet weigh in.

Shnider pressures Katz on the minimum wage bill.

Knocking off an incumbent is not easy.  Indeed, only one Democratic district council incumbent has been defeated since the County Council’s current structure was established in 1990 and that happened twenty years ago.  In the last six times that a Democratic district council incumbent was challenged, the incumbent won by 50 or more points five times.

Ben Shnider has nothing to lose by challenging Katz.  He is running a tremendous campaign and has built great relationships with the left and the smart growth community.  If he loses, he could very well come back to win another election as so many other MoCo politicians have.  Win or lose, Shnider will be just fine.

But what about these progressive groups?  The fact that so many of them have endorsed Shnider has MoCo’s political community watching this race – especially the county’s elected officials.  The left will have many priorities in the next term and some will cost serious money and political capital.  If these groups actually knock off Katz – or come close – then no one will want to run afoul of them in the future.  But if they do nothing other than allow Shnider to use their logos and Katz wins big, they will look weak.  Other elected officials will think, “They can’t hurt me so I can do what I want.”  Let’s remember that for most politicians, the main thing on their minds is ALWAYS whether a group can help them or hurt them.  If you can’t do either, you just don’t matter.

The progressives are making a big gamble by targeting Sidney Katz.  For their sake, it better pay off.

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Adam Pagnucco, Economy

Taxpayer Flight from MoCo, Part One

By Adam Pagnucco.

We have been printing a ton of posts about the economy on Seventh State, including discussions of our employment and income growth, our rate of business formation, our increasing reliance on corporate welfare to attract and retain employers, the role of economic growth in creating the county’s $120 million budget shortfall and reactions from County Executive candidates and gubernatorial candidate Kevin Kamenetz. Let’s be clear: as we wrote eleven years ago, without economic growth, we will not be able to meet our needs without more tax hikes in the future.  And today, we begin presenting the following facts.

More taxpayers have been leaving Montgomery County than entering it for a long time.

The taxpayers who are coming in make less money than the ones who are leaving.

And while this has been going on for decades, it is now worse than it has ever been.

Our basis for these statements is a data series on tax migration maintained by the Internal Revenue Service (IRS).  As the IRS explains:

Migration data for the United States are based on year-to-year address changes reported on individual income tax returns filed with the IRS. They present migration patterns by State or by county for the entire United States and are available for inflows—the number of new residents who moved to a State or county and where they migrated from, and outflows—the number of residents leaving a State or county and where they went. The data are available for Filing Years 1991 through 2016 and include:

  • Number of returns filed, which approximates the number of households that migrated

  • Number of personal exemptions claimed, which approximates the number of individuals

  • Total adjusted gross income, starting with Filing Year 1995

  • Aggregate migration flows at the State level, by the size of adjusted gross income (AGI) and age of the primary taxpayer, starting with Filing Year 2011.

For every state and county in the U.S., the IRS tracks both inflow and outflow of returns, exemptions and adjusted gross income.  But that’s not all: the IRS reports the origin and destination jurisdictions of these flows.  So data users can see a situation in which County X has a net inflow overall but has a net inflow from County Y and a net outflow to County Z.  The directions of these flows, in an out, become apparent when the data is downloaded and crunched.

Over the next few days, we will publish the following statistics.

Montgomery County’s inflows and outflows of returns and adjusted gross income from 1993 (the first year in which comparable data is available) to 2016.

Inflow and outflow statistics for MoCo and its large neighbors – D.C., Frederick, Howard, Prince George’s, Alexandria, Arlington, Fairfax, Loudoun and Prince William – to provide perspective.

A listing of destination and origin jurisdictions of taxpayer migration between MoCo and its neighbors.  This will identify MoCo’s comparative advantages and disadvantages in taxpayer flow across the region.

Tomorrow, we will proceed.

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Adam Pagnucco, budget, Economy

The View From 2007

By Adam Pagnucco.

A long time ago in a galaxy far, far away, a newish county blogger and professor named David Lublin reached out to a then-young civic activist who had just gotten involved in local politics to write about the county’s economy and budget.  The activist, who had only lived in the county for three and a half years and was already raising Cain about a new Metro entrance in Forest Glen, was still figuring out what was going on but – what the hell – he agreed.  This was the genesis of my second blog post ever, written in April 2007.  (The first was a piece on the Apple Ballot the year before.)

The county’s economic pressures, which have drawn substantial attention on Seventh State, were apparent more than a decade ago.  Then as now, the county was dealing with short-term budget issues.  But over the long term, I wrote that the end of the real estate boom – which would lead to the Great Recession – would result in three choices to balance the budget and preserve county services: large tax hikes, slowing the rate of budget growth or encouraging economic growth to fund the budget.  Many things happened over the ensuing decade: dramatic budget cuts, equally dramatic tax hikes, warfare with the school system and the state over education funding, breaking of union collective bargaining agreements and more.  But in the end, more a result of just muddling through rather than any strategy, the county picked options 1 and 2 – tax hikes and slower budget growth – and not option 3, which was encouragement of economic growth.  Indeed, because our economy has been so stagnant since the recession, we are now discussing pretty much the same things I wrote about eleven years ago.

Will the next decade be different from the last decade?  Folks, that is what this election is about.  It’s all up to you.

Here is the piece from 2007 reprinted.

*****

In Montgomery County local races, four issues regularly rise to the top: education, development, traffic congestion and the environment, in no particular order. In last year’s elections, all four issues were discussed by the candidates – especially development. But this spring a fifth issue has risen to surpass all of them: the county’s difficult choices on the budget. The budget is not only an unavoidable issue because it is central to the functioning of the government – it also affects the ability of county leaders to deal with each of the above four issues that are important to voters.

The county has a short-term problem and a long-term problem with its budget.

The short-term problem appeared in the first budget submitted by our new County Executive. While Ike Leggett’s proposal for $4.1 billion in county spending was 6.3% higher than last year’s budget, the increase was below the prior year’s rate of 9%. Leggett pronounced recent budget growth “unsustainable” and declared that no county agency, including the schools, would get its entire budget request. Despite an aggressive lobbying campaign by public sector unions – especially the Montgomery County Education Association – the County Council seems likely to uphold the broad outlines of the County Executive’s proposal.

Furthermore, Council President Marilyn Praisner has identified a $269 million budget deficit for the fiscal year starting in July 2008. The deficit margin is about 7% – which is close to the increase recommended for this year. The council may very well combine a small tax increase with careful maintenance of core spending to deal with this deficit. This may be enough to avoid modifying the county’s labor contracts with its employees as the Council President has recently discussed.

As serious as the short-term problem is, it does not compare to the county’s budget issues of 1991-92 when it suffered from an economic recession. At that time, 7,000 county employees were furloughed for four days. Public employees occupied the council chambers, teachers engaged in a work slowdown and some public school students walked out of classes to protest potential cuts. No one is predicting similar upheaval this time.

However, the long-term budget problem represents a significant challenge. Since 1990, the county’s population growth has averaged 1.4% per year while its budget has generally grown 5-10% per year. In recent years, the county has managed this by depending on big increases in property tax receipts driven by its real estate boom. That real estate boom has ended and property tax receipts will soon reflect that. The county faces three choices in the long run:

1. Large tax hikes to fund budget increases. The danger here is that those tax hikes may slow the county’s economic growth rate even further, worsening its fiscal problems in the future.

2. Slowing the rate of county budget growth to equal the rate of economic growth. This would mean county budget growth of 1-2% per year. This would be insufficient to meet the standards of service to which residents have become accustomed. School, fire, police and health care costs are all increasing at faster rates even if the size of the relevant county departments remains unchanged. This budget growth rate would also be insufficient to adequately compensate county employees, and that would gradually damage one of the nation’s best-educated, least-turnover-prone local government workforces.

3. Systematically encouraging enough economic growth to fund the county’s budget.

The third option reveals a naked truth that was not commonly discussed during the last campaign: budget policy and development policy are inter-related. Over the long run, limiting economic growth will limit the ability of local government to serve its residents. But as any resident of Phoenix or Las Vegas would observe, economic growth has consequences for quality of life. The question of the last campaign was, “Should we have development or not?” But the real question is, “How can we have enough economic growth to pay for government services we need without driving existing residents crazy?”

Economic growth comes from two sources: population growth and job creation. If one of these occurs without the other, or if they occur in different geographic locations, the result is traffic congestion. The two should occur together, at similar rates, and in nearby locations. This has direct implications for county development policy.

In general, the county has three kinds of developable areas: the agricultural reserve, the four downtowns (Bethesda, Rockville, Silver Spring and Wheaton), and the rest of the county. Most residents agree that the agricultural reserve should continue to be protected for cultural and environmental reasons. That leaves the other two areas for consideration.

The four downtowns are unique assets in the county because they each have residential density, concentrated office space and pedestrian-oriented retail space all within walking distance of each other. A resident of Bethesda’s central business district (CBD) who also works in the CBD does not have to use his or her car every day. That individual can walk to work and walk to the grocery store on the way home. The fact that all of the amenities of life are concentrated in a walkable radius cuts back on car use, which cuts down on energy usage, greenhouse gases and pollution. It also reduces the need for road maintenance.

But many residents may want to live in one CBD and work in another. This means that the CBDs should be connected, preferably through transit. Bethesda is connected to Rockville, and Silver Spring is connected to Wheaton through Metro’s Red Line. Bethesda could be connected to Silver Spring through the Purple Line. And a bus rapid transit route from Wheaton to Rockville is the county’s top transit study request of the state government. If both of those projects go through, the county will have four inter-connected downtowns.

How could the county encourage economic growth in downtowns rather than sprawl in non-transit-accessible suburbs? In the downtowns, the county could use zoning text amendments (or more ambitiously, coordinated and complementary updates to master plans) to encourage transit-oriented CBD growth. In non-CBD areas, project area transportation reviews and robust school capacity tests would limit development outside the downtowns. This combination of measures would channel economic growth to the CBDs while minimizing the consequences of traffic congestion and pollution. The side effect would be to encourage the creation of downtown entertainment districts, each customized to reflect the unique cultural identities of each CBD.

For those who are uneasy about growth in downtowns, keep in mind the other two budget options: large tax hikes or gradually deteriorating government services. No local area in this country – even Montgomery County – is immune to the negative long-run effects of either (or both).

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Adam Pagnucco, Bill Frick, County Executive, George Leventhal, Marc Elrich, Roger Berliner

The Executive Contest is a Two-Candidate Race

By Adam Pagnucco.

The Washington Post recently published an article declaring that the contest to succeed County Executive Ike Leggett was seen as “anybody’s race.”  Pshaw!  One of two candidates will win it.  One of them is Council Member Marc Elrich, who finished first in the last two Council At-Large primaries and is nearly sweeping progressive endorsements.  The other is…

We don’t know yet.  And we don’t know if we ever will.

During the 2016 Congressional District 8 race, your author called up one of the smartest people in state politics we know.  This fellow lives outside MoCo but he tracks all parts of the state and has sources everywhere.  When we asked him who was going to win, he said, “When I talk to the various campaigns, all of them say they’re gonna be the last one at the end along with Jamie Raskin.  When I hear that over and over, when I see that they all think that Jamie is the man to beat, that leads me to think Jamie will win.”  That dynamic is going on now in the Executive race.

Elrich’s long-time message combining opposition to development with far-left progressivism has earned him an overlapping base of land-use voters, liberals and Downcounty residents, especially in and near Takoma Park, where he served 19 years on the City Council.  In the 2014 Council At-Large race, Elrich finished first in every council district except 2 (where he finished second to Nancy Floreen) and first or second in every local area in the county except Damascus and Laytonsville.  He finished first in 138 of 251 precincts.  In the 2010 Council At-Large race, Elrich finished first in all five council districts and in every local area in the county except Cabin John, Damascus, Darnestown and Laytonsville.  He finished first in 166 of 243 precincts.  No other MoCo politician running for county office in this cycle has a base of this kind.

How did he assemble it?  For many years, Elrich has been assisting residents who oppose master plans all over the county.  And whether they won or lost, those development opponents came away from the fight with Elrich as their hero.  Here is an illustration: an email sent out by the East Bethesda Citizens Association on 6/2/16, on the eve of the council’s consideration of the Downtown Bethesda Master Plan, describing their meeting with Elrich and calling for action:

A year later, Elrich cast the lone vote against that master plan as he has with several other plans.  This plan’s opponents have now been incorporated into Elrich’s base – assuming they were not part of it already.

While other candidates struggle to attract volunteers, Elrich’s volunteer base is well established.  In 2014, the campaigns of Elrich and his ally, Beth Daly, posted poll coverage sign-ups on Signupgenius.com.  They were able to recruit coverage on 67 precincts, many on more than one shift, with particular strength in the voter-rich areas of Silver Spring, Takoma Park and Leisure World.  No one other than the Apple Ballot could touch this.  Now that he is running for the county’s highest office, how many precincts will Elrich be able to cover?

Among the influencers and highly informed activists, this election is rapidly becoming defined by whether you’re with Elrich or not.  If you don’t believe us, check out the Council District 1 candidates.  They’re an interesting group that collectively spans the differences of opinions in the county district containing the most Democrats.  Bethesda Magazine reporter Andrew Metcalf asked them during a recent debate for whom each was going to vote in the Executive election.  After significant prodding, here’s how the candidates responded:

Bill Cook – would vote for Marc Elrich

Pete Fosselman – undecided; wouldn’t vote for Elrich

Andrew Friedson – undecided; disinclined to vote for Elrich

Ana Sol Gutierrez – torn between Elrich and George Leventhal

Jim McGee – would probably vote for Elrich

Reggie Oldak – refused to say; would not vote for Elrich

Dalbin Osorio – would vote for Elrich

Meredith Wellington – undecided

All of the non-Elrich candidates have potential as well as challenges.  Council Members Roger Berliner and George Leventhal are running on their experience and qualifications.  (Disclosure: your author respects both but supports Berliner.)  Berliner is trying to get known outside his council district and Leventhal has been severely out-polled by Elrich in the last two elections.  Delegate Bill Frick, former Rockville Mayor Rose Krasnow and businessman David Blair are the fresh faces.  But they are little-known in most parts of the county and Blair started as a complete unknown.  All of these candidates have a long way to go and each of them is in the others’ way.

To contrast with Elrich effectively, a non-Elrich candidate needs to hit this sweet spot dead-on: “We live in a great county, but we can be even better.  Here are some ways we can improve.”  That involves a bit of threading the needle for the two council incumbents.  It’s understandable that they might react to critiques of the county’s economic performance as criticism of their records, but they should think of it like this: every Executive leaves unfinished business for the next Executive.  Ike Leggett inherited his share of problems from Doug Duncan, who in turn inherited some issues from Neal Potter.  This is entirely normal, so who is the best choice to lead in the future?  As for the non-incumbents, they aggressively point to the need to improve, but they tend not to have many specific proposals to get better because they don’t know the history and operations of county government as well as the two Council Members.  To be fair, how could they?  If no one hits this sweet spot, that leaves Elrich as the only candidate with a crystal-clear message that is distinct from the others.  Those who hear Elrich’s message and agree with it are less likely to peel off to someone else than tentative supporters of the other candidates who might change their preferences between them.

One more thing: we wouldn’t be surprised if most, if not all, of the non-Elrich candidates have polled.  If so, they all probably found similar results.  And so they could all tailor their messages in similar ways and maybe even say the exact same things.  That would blur the differences between them and make Elrich stand out even more.  This may already be happening as Berliner, Blair and Frick all repeatedly mentioned “innovation” at last Friday’s Executive forum.  Was that a coincidence?

If questioned privately, we bet all of the non-Elrich candidates would grudgingly admit that it’s a problem that five of them are in the race.  Each of them wants to be the person who gets to take on Elrich one-on-one.  So each of the five is looking at the others and saying, “If YOU all get out of the way, I can beat Elrich.”  But no one is dropping out because they all think they have a shot.  The big winner from this is – you guessed it – Marc Elrich.

One non-Elrich candidate needs to emerge from the pack and consolidate everyone that is not in Elrich’s camp.  If that happens, Elrich is beatable.  But if nothing changes and this election continues down the path it is on, Elrich will win with less than 40% of the vote.

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Adam Pagnucco, Bill Frick, County Executive, Economy, George Leventhal, Marc Elrich, Roger Berliner

Executive Candidates React to Sage Consulting Report on MoCo Economy

By Adam Pagnucco.

Last Friday, the candidates for County Executive attended a forum to discuss a report by Sage Consulting listing numerous problems with the county’s economy.  Afterwards, most of the Executive candidates commented on the report and on the economy more generally via email and social media.  Their responses say a lot about which ones take the economy seriously, an issue that has drawn much attention from Seventh State.

Council Member Roger Berliner (whom your author supports) sent out this email over the weekend.

Our county has serious work to do to improve our business climate, diversify our economy, and increase the number of good jobs. It must be Priority #1 if we are going to be able to meet the needs of our school system, reduce congestion, invest in public safety, and protect our environment.

I have a record that I am proud of on improving our economy and a vision for our future that you can read about here. Some of my competitors have records too. Others have just words. It’s important to consider what we have done in pursuit of increasing prosperity, not just what we say we will do.

My record includes leading the successful effort to reduce our energy tax three years in a row; creating the small business navigator and a micro-loan program to help our local small businesses and entrepreneurs thrive; and playing a leading role in our Amazon bid. My vision is of a forward leaning county that embraces innovation, education geared towards the jobs of tomorrow, and vibrant urban centers served by state-of-the-art transit.

Yesterday, a consultant tasked with assessing our business climate and outlook, issued a scathing report. It highlighted one startling statistic: that “between 2011 and 2016, the number of [business] establishments in Montgomery County increased by 6, or roughly the population of businesses at a strip mall.” The report concludes that “Montgomery County therefore desperately needs to step up efforts to expand its commercial tax base.” You will get no debate from me on that point.

At the same time, the report declares:

This should not be mistaken for an assertion that Montgomery County is anything other than the finest possible location for Amazon HQ2. It will be difficult for Amazon to identify an area that is as open to new ideas, offers such abundant human capital, is as saturated with transportation options, supports such high quality public education, is as institutionally rich, and is as committed to shared prosperity as Montgomery County, MD.

So, while it is true that we have our challenges, challenges that must be met head-on, it is also true that we have extraordinary assets and a quality of life to match. I will build on our assets as your next County Executive, work diligently to improve our business climate, and am 100% committed to expanding a “shared prosperity.”

Life is good in Montgomery County, but we can make it better still. That’s my goal: a “more perfect” Montgomery County.

In service,

Roger Berliner

Delegate Bill Frick (D-16) sent out this email hours after the Executive forum ended.

Something doesn’t add up. How does a county with our talent, our people, our great public schools and our values lag behind the rest of our region in job growth and economic development? How is it that private sector employment has declined by 12,500 jobs from 2006 to 2016? How is it that, during that same time period, Montgomery County created on net just six new businesses?

The answer is clear. As I told the Montgomery County Business Roundtable earlier today, it is our political culture. My opponents have built a political culture in Montgomery County that doesn’t want to work with businesses to thrive and grow here in our County.  And if we elect someone to be County Executive who is part of that culture, things will not get better for business.

I am an outsider to Montgomery County Government and yet I have real governmental leadership experience as the Majority Leader of Maryland’s General Assembly. I have the relationships in Annapolis that can help our County. But since I am not a multi-millionaire, and unlike three of my opponents, I am not spending your taxpayer dollars to fund my campaign, I need your help to communicate with Montgomery County residents who deserve leadership that the current members of the County Council will not provide.

Montgomery County is an awesome place to live. It’s why I’m raising my two children here and sending them to our public schools. But we have a problem, and that is that we must reform in order to create new private sector jobs and increase our tax base. We have to focus on the core functions of county government – education, public safety, and transportation – and those need to be our priorities for our budget. Our County Government does not need to be in the liquor business, a failed venture that is hurting our food culture to the benefit of downtown DC restaurants. We have to have a culture of ‘yes’ in county government so that we are trying to find reasons to say yes to businesses rather than find reasons to say no.

Sincerely,

Bill

Former Rockville Mayor Rose Krasnow ran this Facebook ad.

David Blair commented on Twitter.

Council Member George Leventhal commented on Facebook.

We are not aware of Council Member Marc Elrich commenting via email, Facebook or Twitter.

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Adam Pagnucco, Bill Frick, Nancy Navarro, Race

Navarro Blasts Krasnow, Blair and Frick Over Racial Equity

By Adam Pagnucco.

County Council Member Nancy Navarro is blasting County Executive candidates Rose Krasnow, David Blair and Bill Frick over their comments on her racial equity resolution.  The council resolution would have the county measure racial equity impacts of budget items and legislation.  Its action language states:

The Council is committed to examining the data needed to develop an equity policy framework that would require the County to question how budget and policy decisions impact equity.

This effort must be a partnership between the County Council, County Executive, County Government, county agencies, institutions, and our community. The County Government
must challenge itself to bring new and different partners to the table. Partnering with other jurisdictions as members of the Government Alliance on Race and Equity (GARE) will also enhance the County’s effort and commitment to fostering equity.

Equity analyses should be part of capital and operating budget reviews, appropriation requests, and legislation. Program and process oversight should be undertaken viewing programs and processes through an equity lens. Equity targets and measures of progress must be put in place.

The Council will provide additional FY19 Operating Budget resources for the Office of Legislative Oversight to develop a baseline report describing current disparities in education, employment, housing, health, employment, land use, and other measures of opportunity by May 31, 2019. Following the transmittal of the baseline report, the Council will introduce legislation for the County to develop an equity policy framework to inform the delivery of all County services.

The entire council, including the three members running for Executive (Roger Berliner, Marc Elrich and George Leventhal), has co-sponsored the resolution.  But fellow Executive candidates Rose Krasnow, David Blair and Bill Frick criticized it in the Washington Post:

Democrat Rose Krasnow, the county’s deputy planning director and a former mayor of Rockville, said she worried the measure would lead to “paralysis by analysis.” She also questioned the timing of the resolution: “It seems like such a political statement in an election year.”

Del. C. William Frick (D-Montgomery) said growing “private-sector jobs” and wages is the best way to eliminate disparities. Businessman David Blair applauded the vote but the Democrat wrote in an email that “we shouldn’t confuse activity with progress. . . . Where’s the progress been the past 12 years?”

That drew Navarro’s wrath.  She denounced the three candidates on Facebook, writing:

I am deeply disappointed by the comments made in this article, by County Executive candidates, Rose Krasnow, David Blair, and Bill Frick regarding my efforts to establish an “Equity Policy” for County Government… These candidates have chosen to dismiss an effort that will directly support our immigrant communities, communities of color, seniors, people with disabilities, and other underserved groups for their own campaign posturing. As far as I’m concerned, I would prefer that our next Executive be someone who is constantly examining how decisions impact all County residents. I hope that the voters will take this into consideration on June 26th!

We see Navarro’s point.  Montgomery County, like the rest of the United States, is rife with inequities of all kinds.  Navarro’s resolution does not prescribe specific remedies; it only initiates the process of measuring inequities so that they can be considered in public policy decisions.  It’s hard to understand how any progressive candidates for office could oppose that.  Perhaps Krasnow, Frick and Blair would like to comment further before their existing remarks are set in stone.

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Adam Pagnucco, Aruna Miller, Republicans

Are Republicans Trying to Help Aruna Miller?

By Adam Pagnucco.

Much has been said about the Maryland Republican Party sending out racist mailers targeting Congressional District 6 candidate Aruna Miller.  The standard interpretation of this seems to be that the GOP sees Miller as a strong candidate and is trying to keep her out of the general election.  Indeed, the Washington Post editorial board made that argument.  But what if the Republicans are actually trying to help Miller instead?

The classic example of intervention in an opposing party’s primary is Missouri Senator Claire McCaskill’s promotion of conservative GOP Representative and eventual opponent Todd Akin.  McCaskill spent $1.7 million on ads accusing Akin of being “too conservative” during his GOP primary, helping boost him past the rest of the field.  And that’s not all – when Akin pulled a successful TV ad in favor of one that flopped, McCaskill schemed to have her pollster contact Akin’s campaign to persuade him to re-run the high-performing ad.  Once Akin won his primary, McCaskill exploited his weaknesses to finish him off and get reelected.

Two “anti-Akin” ads by McCaskill and the Democratic Senatorial Campaign Committee.

Why do we bring this up?  Some of the people who received the GOP mailers were female Democrats, including Miller herself.  A few took to Facebook and Twitter to complain about it.  And if they didn’t get them directly, they may have read about them in publications like the Washington Post, Bethesda Magazine and India West.  How do you think they are going to react when they see a female Democratic candidate getting bashed in racist mail sent by Republicans?  They are going to rally to Miller, of course, and that’s what happened on social media.  Maybe that’s the point.

Miller uses GOP racism to motivate her supporters.

Aruna Miller is doing really well in this campaign.  She is raising lots of money, doing well at forums, attracting great endorsements from the Sierra Club and the teachers and is the most prominent woman running in a primary electorate that is roughly 60% female.  But look at this race from the standpoint of the GOP.  They know David Trone won an absolute majority of the vote in rural Frederick and Carroll Counties in the CD8 primary – the kind of areas that Republicans need to dominate in the sixth district.  They know Trone could spend $10 million in a general election, something no other Democrat can do, and that would free up national Democratic money to go to other Congressional districts around the country.  Most of all, Trone looks more like incumbent Congressman John Delaney than any other candidate – a center-left businessman who says he has created thousands of jobs.  The GOP knows that kind of candidate can win in this district.  Why would they want another one like Delaney?  And if they don’t, why not help a rival win?

Maybe we’re reading too much into this but we don’t think the GOP is stupid.  This kind of tactic can work.  Just ask Claire McCaskill!

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