Category Archives: Adam Pagnucco

Adam Pagnucco

MoCo Had Nineteen New Business Filings in 2016

By Adam Pagnucco.

Your author has been a corporate and economic researcher for almost twenty-five years.  During that time, we have encountered MANY crazy statistics.  Most of them can be thrown out in ten seconds or less as obviously flawed, generated by suspect sources or both.  But once in a while, even a crazy statistic can have merit because it comes from an unimpeachable source.  This is one of those times.

According to the State Department of Assessments and Taxation (SDAT), there were nineteen new business filings in MoCo in Fiscal Year 2016.  Not nineteen thousand or nineteen hundred.  Nineteen.

This stat came to light in connection with HB380, a bill introduced by Delegate Mark Fisher (R-Calvert) that would exempt new businesses from paying personal property taxes.  In writing the fiscal note for the bill, the General Assembly’s Department of Legislative Services (DLS) had to estimate how many new businesses are started around the state and the volume of personal property taxes they pay.  So DLS went to SDAT, which processes business filings as part of its duties.  All corporations and partnerships must register with SDAT to operate legally in the state.  SDAT reported to DLS that the state had 332 new business filings in FY16, of which nineteen were in MoCo.

SDAT’s tabulation of new business filings by county in FY16.

Could this be a fluke?  That’s a natural question to ask of any seemingly crazy stat.  Fisher introduced a similar bill two years ago (HB572) for which a fiscal note was drafted using FY15 data.  In that year, the state had 536 new business filings, of which fifty-seven were in MoCo.

SDAT’s tabulation of new business filings by county in FY15.

Let’s note that this data does not directly address jobs, the huge majority of which are created by existing businesses that expand operations.  But MoCo has been a weak job generator over the last fifteen years and in order to have existing businesses, new ones must be constantly created.  An anemic pace of business formation may eventually impact job creation.

According to the Census Bureau’s 2012 Survey of Business Owners (available through American Fact Finder), there were 118,965 firms in Montgomery County, 21,396 of which had paid employees.  Given those numbers, one might expect hundreds of firms to start up and a similar number to go dark every year due to the churn of capitalism.  But nineteen new companies in one year?  Bethesda Magazine printed a list of sixteen Bethesda-area restaurants that closed in 2016.  If only a handful of more businesses closed in the entire county, MoCo would have had net negative business formation that year.

Additionally, MoCo’s performance relative to the rest of the state was sub-par.  According to the Census Bureau, the State of Maryland had 531,953 firms in 2012, of which 101,876 had paid employees.  So MoCo had 22% of all firms in the state and 21% of the firms with paid employees.  However, MoCo had just 6% of the state’s new business filings in 2016 and 11% of new filings in 2015.  We would love to acquire historical data to see if this is a trend.

This data joins soft recent growth in employment and income as well as the $120 million budget shortfall, half of which was due to factors other than tax planning by the wealthy, as evidence that our economy is not as strong as we would like it to be to pay our county’s bills.  And because the new business filings were weak in many other local jurisdictions besides MoCo, economic growth must draw attention across the state as well.

Which candidates for office do you think can help turn this around?

Update, 4/25/18

This was not clear in the fiscal note, but the Department of Legislative Services analyst who wrote it has stated that the new business filings referred to in the note only counted businesses with personal property.  The analyst wrote in an email:

The SDAT data used in Exhibit 1 in the Fiscal and Policy note is for new business filings for those businesses with assessed personal property for that year.  The fiscal note could have been worded a bit more specifically to mitigate any confusion, however, the bill would have provided a personal property exemption for businesses with personal property, so businesses with no personal property would not have had an impact on local revenues.  We never asked for all business filings as the bill really only dealt with a personal property tax exemption.

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Adam Pagnucco, environment, Sierra Club

Sierra Club Issues Second Round of Endorsements

By Adam Pagnucco.

The Maryland Sierra Club has issued a second round of state-level endorsements.  We have previously listed their first round of endorsements and their county-level endorsements in MoCo.  The new MoCo candidates who have been endorsed are:

District 14: Senator Craig Zucker, Delegate Pam Queen.  Delegates Anne Kaiser and Eric Luedtke were endorsed in the first round.

District 15: Delegate candidate Lily Qi.  Senator Brian Feldman and Delegates Kathleen Dumais and David Fraser-Hidalgo were endorsed in the first round.

District 16: Delegate candidate Sara Love.  Senator Susan Lee and Delegates Ariana Kelly and Marc Korman were endorsed in the first round.

District 17: Delegate candidate Julie Palakovich Carr.  Senator Cheryl Kagan and Delegates Kumar Barve and Jim Gilchrist were endorsed in the first round.

District 18: Senate candidate Jeff Waldstreicher, Delegate candidates Emily Shetty and Jared Solomon.  Delegate Al Carr was endorsed in the first round.

District 19: Senate candidate Ben Kramer, Delegate candidate Vaughn Stewart.  Delegates Bonnie Cullison and Marice Morales were endorsed in the first round.

District 20: Senator Will Smith, Delegate Jheanelle Wilkins.  Delegate David Moon was endorsed in the first round.

District 39: Senator Nancy King, Delegate candidate Lesley Lopez.  Delegates Kirill Reznik and Shane Robinson were endorsed in the first round.

Every MoCo incumbent running for reelection was endorsed.  Two Delegates running for Senate, Jeff Waldstreicher and Ben Kramer, were also endorsed.  The full statewide list can be seen here.

The big winners here are the non-incumbent House candidates looking to distance themselves from competitors, including Qi (D-15), Love (D-16), Palakovich Carr (D-17), Shetty and Solomon (D-18), Stewart (D-19) and Lopez (D-39).  Lopez is a really big winner because she gets to talk about something other than the District 39 slate controversy and she interrupts a growing slew of labor endorsements for her most viable rival, MCGEO employee Gabe Acevero.  Interestingly, the Sierra Club did not choose between the leading two District 20 open House seat contenders, Lorig Charkoudian and Darian Unger.

We are tracking prominent institutional endorsements and will post a summary list soon.

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Adam Pagnucco

Back Door Rent Control Bill Introduced at Last Minute

By Adam Pagnucco.

In preparation for months but dropped at the last minute, a local bill now under consideration by the Montgomery County delegation may just bring rent control to the county.  The bill has received scant notice… until now.

MC 15-18 would establish standards of just cause for the eviction of tenants in Montgomery County.  The bill defines just cause as tenant behaviors including not paying rent, breaching the terms of the lease, committing illegal acts on the premises, causing substantial damage, engaging in disorderly conduct, refusing to grant access to the landlord for repairs and inspections and refusing to provide information to satisfy affordable housing agreements.  Just cause would also exist if the landlord is removing the unit from the rental market, recovering it for use by family members or performing work that requires evacuation.  There is also this definition of just cause:

A tenant refuses, after receiving notice, to execute an extension or a renewal of an expired residential lease for a term of like duration and on terms substantially similar to the terms of the prior residential lease.

In other words, a tenant may not be evicted if a lease renewal does not have terms “substantially similar” to the prior lease.  What does that mean?  If a lease contains a rental rate that increases above the prior rate by more than the rate of inflation, is it “substantially similar” or not?  The bill does not say.  It’s possible that if the bill is passed in its current form, a tenant could challenge a new lease with an above-inflation rent hike on the grounds that it is not “substantially similar” to the prior lease.  If the courts agree, MoCo would be effectively subject to rent control.

The circumstances of the bill’s introduction are troubling.  The bill was drafted on October 17.  There was plenty of time for it to be introduced before the delegation’s local bill hearing in Rockville on December 6, which was live streamed and is available for viewing on the county’s video archive.  Instead, the bill was introduced as a late file on February 2 – more than three months after it was drafted.  The hearing in Annapolis seven days later, which was not televised or recorded, had just eight witnesses because there was not enough time to hear everyone who wanted to speak.  (That’s a sharp contrast with the Rockville hearings, which frequently stretch into the wee hours.)

The upper right corner of the bill clearly shows its drafting date as October 17.

We have no position on just cause eviction, but a huge body of research shows that rent control has been a massive policy failure.  Its usage in Takoma Park has coincided with an 18% drop in the number of rental units in the city between 2000 and 2015.  Even a Vietnamese Communist Foreign Minister admitted that rent control there was a mistake, saying, “The Americans couldn’t destroy Hanoi, but we have destroyed our city by very low rents. We realized it was stupid and that we must change policy.”

Bills like this are why we have a legislative process, as lengthy and frustrating as it might be.  It’s entirely possible that this bill’s sponsors do not intend for it to enact rent control.  One of the reasons why we have public input and press scrutiny is to identify unintended consequences in legislation so that they can be remedied and not cause problems later.  When bills are withheld for months and dropped at the last minute, that process is hindered.  Moreover, the delegation needs to consider this: is it fair to ask colleagues to cast a tough vote on something as politically volatile as rent control just months before the election?  And especially under circumstances of introduction such as these?

This bill needs to be withdrawn, reworked and reconsidered next year.  Whatever is done, let’s make sure to get it right.

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Adam Pagnucco, Hans Riemer, Marc Elrich, Nancy Navarro

Laborers Union Announces MoCo Endorsements

By Adam Pagnucco.

The Mid-Atlantic region of the Laborers International Union of North America (LIUNA) has announced its endorsements in MoCo county-level races.  The union is supporting Marc Elrich (County Executive), Andrew Friedson (Council D1), Ben Shnider (Council D3), Nancy Navarro (Council D4), Tom Hucker (Council D5) and Hans Riemer and Chris Wilhelm (Council At-Large).

LIUNA’s announcement on Twitter.

Elrich and Shnider are starting to roll up progressive endorsements; both are supported by SEIU Local 32BJ and Casa, while Shnider has the Sierra Club and Elrich has the AFL-CIO.  Friedson looks like he is building the kind of business-labor coalition that once supported politicians like Doug Duncan.  Navarro and Hucker have no opponents – so far.

LIUNA, SEIU and UFCW Local 400 (grocery store workers) are probably the most active unions in the Washington region that include at least some private sector members.  LIUNA does not represent any MoCo county employees, but it does represent workers employed by the county’s private trash removal contractors.  LIUNA’s main objective is getting the county to use project labor agreements on its construction projects which would mandate union representation of the workers on those jobs.  While the union has not been a huge player in MoCo politics in the past, it did spend hundreds of thousands of dollars to get Cathy Pugh elected as Mayor of Baltimore in 2016.

[Disclosure: your author worked as a strategic researcher for LIUNA’s international office in 1994 and 1995.]

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Adam Pagnucco, Dana Beyer, Jeff Waldstreicher, Larry Hogan, Marc Elrich, Marc Korman, Rich Madaleno, Roger Berliner

Top MoCo Fundraisers, January 2018

By Adam Pagnucco.

Recently, we have run several reports on fundraising through January 2018.  This post combines all of our data and presents the top 20 fundraisers in MoCo so far.  Note that we break out self-financing and report totals raised for the cycle, not just totals since the last report.  And… here they are!

A few random thoughts.

1.  It’s natural to expect Brian Frosh and Peter Franchot to be the leaders since they both hold statewide offices.  Of the county-level candidates, Council Member Roger Berliner, who is running for Executive, is number one.

2.  The numbers for Senator Rich Madaleno (D-18), who is running for Governor, are misleading since he will be applying for public matching funds.  Madaleno has said that he anticipates receiving about $975,000 from the state.

3.  Delegate Jeff Waldstreicher (D-18), who is running for Senate, is the leading fundraiser among all of MoCo’s state legislators.  He will need that money against his self-funding rival, Dana Beyer.

4.  County Executive candidate David Blair, gubernatorial candidate Krish Vignarajah, Council District 1 candidate Andrew Friedson and Council At-Large candidate Bill Conway are first-time candidates.  It’s a significant achievement for first-timers to make a list of this kind although it’s somewhat tempered by the self-financing of Blair and Vignarajah.

5.  Delegate Marc Korman (D-16) is the only first-term elected official on this list.  That’s a big deal and a sign of good things to come.

6.  Council Member Marc Elrich, who is running for Executive, has never been on a top fundraising list in his life.  He is now, and that’s thanks to public financing.

7.  Lieutenant Governor candidate Susan Turnbull raised more money in a month and a half of campaigning than half the people on this list did in the entire cycle, a staggering feat.

8.  Governor Larry Hogan has raised more money this cycle ($11.5 million) than everyone on this list combined.

Note: an earlier version of this post mistakenly omitted Turnbull’s results.  We have corrected it to include her.

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Adam Pagnucco, budget, MCEA, MCPS

Team MoCo

By Adam Pagnucco.

Yesterday, we wrote about the recent history of MCPS and it was not a pretty picture.  The recession, new state laws, political conflict and the erosion of a once-strong consensus around the public schools resulted in MCPS getting lower funding increases than most of the rest of county government, especially when measured in local dollars.  But the good news here is that change is coming to MoCo with the sheer number of open seats in county elected offices.  There is a better way forward.  And today, we will plot out what that way can be.

First, let’s steal a page from the playbook of former MCPS Head Coach Jerry Weast and recognize this: nothing brings folks together like a common enemy.  The Axis powers brought together America and the Soviet Union.  The New England Patriots brought together nearly all NFL fans without ties to the Greater Boston area to root for the not-quite-as-bad Philadelphia Eagles.  And Donald Trump may just bring together the feuding members of Crosby, Stills, Nash and Young, who hate Trump more than they dislike each other.

The various factions of MoCo’s education family do not have a common enemy, but they do have a common challenge: dealing with Annapolis.  The state capital poses three problems for MoCo’s public schools.  First, the state has a Governor who has cut education funding before (especially state aid for MoCo) and is doing it again.  Second, while the state has improved recently, it still short changes MoCo on school construction money and the county cannot keep up with capacity needs on its own.  And third, a consultant advising the state’s Kirwan Commission on education reform has recommended massive cuts to state operating aid to MCPS.  If all three of these things proceed in a baleful direction, MCPS’s funding issues will get a lot worse and the entire county – parents, students, school employees, residents and businesses – will pay a steep price.

When you get past the details of MCPS’s recent money problems, one root cause stands out: political division in the wake of Weast’s departure.  The County Executive, the County Council, MCPS leadership, the MCPS unions and the PTAs all have different priorities and different views on MCPS funding, and they often go in different directions.  That has to stop or things won’t change.  We need a Team MoCo.  And here’s what that looks like.

County Council

The council has one job when it comes to the schools: funding them.  And since the schools are both a critical public policy priority as well as a big political priority for the voters, their funding situation must improve from the last eight years.  The council largely got this right in its FY18 budget, which gave MCPS a modest (roughly $20 million) increase over the state’s Maintenance of Effort requirement.  The policy of regular, modest per pupil local dollar increases that will – at the very least – keep pace with MCPS’s costs and needs should continue.

The council must not get involved in sensitive internal MCPS issues, especially in pressuring the system on its collective bargaining agreements.  Blowing up the union contracts in 2016 was a major mistake and caused a serious breach of trust.  Let MCPS management and the unions decide what the agreements look like in the context of their total budget.  If the council does not stay out of this, Team MoCo will crumble and the entire arrangement will fall apart.

Superintendent and Board of Education

If the council gives MCPS leadership the funding it needs, then MCPS leadership must reciprocate by giving the council what it needs: fiscal stability.  The state’s Maintenance of Effort (MOE) law, which was rewritten in 2012, sets each year’s local dollar per pupil funding as a base for future years.  Every time the base goes up, it becomes a new base and can only be lowered by a waiver from the State Board of Education.  This is a major concern for the council and was partially responsible for several years of per pupil cuts and freezes.  Given the immense implications of this for the county’s budget and AAA bond rating, the council is right to be wary of going too far above MOE.

Fortunately, § 5-202 (d) (9) of the state’s education law specifies that the State Board of Education shall grant an MOE waiver “in the amount that has been agreed on by the county and county board that is attributable to reductions in recurring costs.”  In other words, if the county falls into another big recession and it has to cut costs in the school system along with all the other agencies, it can get a waiver if the school board agrees.  This deal must be honored by MCPS: if the council extends its trust by funding them, MCPS must agree to reciprocate by helping to relieve the county of financial stress in dire circumstances.  Both sides must stick to this or relations will revert to the bad old years.

MCPS Unions and PTAs

MCEA and SEIU Local 500 are two of the most powerful players in county politics.  The PTAs do not endorse candidates, but they have listservs that include thousands of parents and therefore – at least in theory – have a big voice.  These organizations should function as the muscle of Team MoCo.  They will be getting regular funding increases and, in return, they should help the Team pressure Annapolis to get what is needed for the county.

MoCo Delegation

If Team MoCo gets its act together and strikes an equitable deal for local funding for the schools, the remaining challenges lie in Annapolis.  Rockville does not understand Annapolis.  It does not fully appreciate the obstacles faced by the delegation in pursuing county priorities: the perception of MoCo by the rest of the state as paved in gold; the competing priorities of other population centers in the state; the constraining effect of the legislature’s leadership; and the fiscal constraints of the state’s own tight budget.  Given those hurdles, it’s a heavy lift for the delegation to bring back Big Bacon to MoCo.  But it can be done: witness the Baltimore City delegation’s victory in getting the state to pump a billion dollars into the city’s school construction program.  The city legislators are not smarter than MoCo’s legislators (although they are more parochial).  A big reason for their win was that the entire city stuck together, from the Mayor to the City Council to the city legislators to the folks back home who wanted the money.  Team Baltimore got a billion dollars.  We need a Team MoCo to do something similar.

The role of the county leadership and its constituent groups is to set a mark for the delegation and do everything possible to help them stay organized and succeed.  This is not easy; the other jurisdictions and the presiding officers won’t just roll over for us.  Every member of Team MoCo has to tell our delegation with one unified voice, “We have your backs.  We know it’s a lift, but if you come through for us, we will celebrate you like the heroes you are.  You will never have to buy a drink for yourselves in Rockville ever again.  And if you don’t come through, you will not be served a drink in Rockville ever again!”  Good performance must be rewarded.  Bad performance must be met with accountability.

One more thing: the delegation has an ace card.  Senate President Mike Miller and Speaker Mike Busch are not going to run the General Assembly for much longer.  Successors to their thrones are making the rounds and lining up votes, however quietly.  The MoCo legislators should tell all of them that whoever gives the county the best deal on schools will lock up all their votes.  It’s huge leverage that should not be wasted, but it will only be used if it pays off in political terms.  Team MoCo’s job is to make sure it does pay off so the Big Bacon gets served.

County Executive

This is the most critical person in this entire endeavor.  Every team needs a Captain.  In MoCo, that has to be the Executive.  This individual is the county’s spokesperson and the one everybody else will inevitably look to for leadership.  The Executive must be a troubleshooter who works out periodic squabbles between the different members of the family, charts out a general course on budgets and state action and makes sure everyone gets the credit they deserve.  Most of all, the Executive must be a LEADER.  The lesson from the aftermath of Weast is that without central leadership, everything can fall apart.  If we pick the right Executive, that won’t happen and Team MoCo can succeed.

And so if everything works out, everyone wins.  The county gets its fair share from the state.  MCPS stakeholders get the funding they need.  MCPS employees get fair compensation and the resources they need to do their jobs.  The elected officials get to be heroes.  And the county as a whole will maintain its status as one of the best places to live on Planet Earth.

We can do it, folks.  Yes we can!  If you agree, ask the candidates how they intend to play on our team and keep it in mind for Election Day.  Team MoCo will only come together if the voters demand it.

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Adam Pagnucco, Apple Ballot, budget, MCEA, MCPS

Where Will the Apple Drop?

By Adam Pagnucco.

Many moons ago, when your author was young and blissfully new to the county, we wrote our very first blog post on the mighty Apple Ballot.  It was unimaginatively titled, “The 800 lb Gorilla of MoCo Politics.”  Then as now, the Apple was one of the most coveted endorsements in MoCo.  But my oh my, so much has changed.

Back in the Age of the Golden Apple, the Montgomery County Education Association (MCEA) was the centerpiece of a powerful political organization created by then-Superintendent Jerry Weast.  Weast was not a pro-union progressive by nature, but he understood that politics is a team sport and it was necessary to play it to get money.  So the Weast Machine included the education unions (MCEA, SEIU and the principals), the PTAs, the Washington Post editorial page and the school system’s internal Ministry of Propaganda.  (That was not its title, but you get the point!)  Weast traded real input in the MCPS budget for stakeholders in return for absolute loyalty in joint combat against the outside – especially the County Council.  Anyone who messed with the school system didn’t take on Weast alone – they had to go against the entire Machine.  Weast capitalized on his organization as well as productive relationships with County Executive Doug Duncan and County Council Education Committee Chair Mike Subin to get substantial and regular budget increases.  The whole system was greased by strong revenue growth and occasional tax hikes.

The District 18/Silver Spring version of the Apple Ballot from 2006.  This is the document that began your author’s career in blogging.

Those days are long gone.  Three major changes have occurred over the last ten years.

First, Weast jumped the shark – not once, but twice.  His first big sin was calling union leaders to his house to ask them to endorse Nancy Navarro in the 2008 Council District 4 special election.  That attracted criticism from multiple Council Members as inappropriate conduct by an appointed non-partisan administrator.  His second big sin was threatening to sue the county over a budget disagreement two years later.  These kinds of behavior helped convince Weast’s adversaries that he was not merely an irritant, but an actual threat, and prompted some to brand him a Rogue Superintendent.  That set the stage for the bitter budget battles to come.

Second, the county and regional economies were greatly weakened in the wake of the Great Recession.  The chart below shows growth in county revenue (excluding intergovernmental aid) over the last twenty years.  Red bars indicate years in which major tax hikes were passed.  From FY98 through FY09, a generally prosperous economy helped county revenues grow by an annual average of 6.2%.  But from FY10 through FY18, the days of the Great Recession and beyond, county revenues grew by an annual average of 3.1%.  (That does not include the recent $120 million budget shortfall.)  There is simply not as much money to go around as there used to be.  Accordingly, revitalizing the economy should be a huge policy objective for all of the county’s employee unions and everyone else who cares about funding local government.

Third, the local money that was available was not as directed to MCPS as it once was.  There are many reasons for that: the Holy War that broke out between the County Council and the school system in Weast’s final days; dissatisfaction with changes to the state’s Maintenance of Effort law; the state’s execrable decision to shift part of the teacher pension burden down to the counties, which is costing MoCo tens of millions of dollars every year and stifling funding for other priorities; and the growth of many other needs in the county’s budget.  Council Member Nancy Floreen defended the county’s record on MCPS funding and your author offered a reply.

Whatever the reasons, MCPS has not received operating fund increases commensurate with most of the rest of the government in recent years.  The chart below shows budgetary growth by major department and agency from FY10, the peak year before the Great Recession, through FY18.  The effects of the recently approved mid-year savings plan are shown at right.  Note that the time period includes the recession itself, the recovery years afterwards and the FY17 9% property tax hike which was marketed as a boost for education.  MCPS’s total funding increased by 13% over these eight years, roughly half the 25% increase for the total county government.  Non-local funding for the schools, the huge majority of which is state aid, went up by 33%.  But local funding for the schools went up by just 6% as the county spent its own money disproportionately on other activities.  Meanwhile, MCPS’s enrollment went up by 15% during this period.

The Weast Machine has been shattered.  Its demise was due to the decline of the economy, conscious policy choices by county decision makers and, ironically, because of the school system’s own leadership as well.  The key moment came in the spring of 2016, when the County Council conditioned its offer of a substantial increase in MCPS funding on a requirement that it go to reducing class size and not to increasing teacher compensation.  The Weast Machine would have resisted that condition, but the system’s leadership agreed to it.  And so the council voted unanimously to instruct the school system to shift $37 million from employee compensation to class size reduction and the school system reduced teacher raises to comply.  The legacy of this moment is that there is no longer a united front between MCPS leaders and their unions – a major loss of leverage in the school system’s dealings with county electeds.  The end result was not so great for the council either as voters, displeased by the big tax hike that year and not mollified by the compensation changes, went on to overwhelmingly approve term limits.

MCEA runs a Facebook ad against the $25 million mid-year cut to MCPS.  The union flooded a town hall meeting with the County Executive to protest it but the County Council approved the cut unanimously.

MCEA will be deciding its 2018 endorsements for county office in the weeks to come.  In the contested races for County Executive, Council At-Large and Council Districts 1 and 3, the mighty Apple Ballot could play a huge role.  Where will the Apple drop?  That depends on how MCEA answers the following two questions.

What to Do With the Incumbents?

Incumbents usually win and MCEA has endorsed the majority of them, including ones who were lukewarm on their issues, in the past.  But in this case, most of the incumbent Council Members voted for multiple very tough budgets, all of them supported reducing teacher raises as a condition of approving more MCPS funding and all of them just voted for a $25 million mid-year cut to MCPS.  Can those strikes be offset by other considerations?

How to Find Someone Better?

Let’s be fair to the incumbents: the recession, the new Maintenance of Effort law and the partial shift of teacher pension funding to the counties created very hard choices.  No matter what they did, the incumbents would have offended someone.  Would the legions of challengers now vying for the Apple’s attention really have done better?  Which ones among them understand the very real and very complicated budget issues that face policy makers?  Which ones will aggressively pursue economic revival, which is necessary for financing all county services – not just MCPS – and supporting justified raises for county employees?  Which ones have the competence to deliver and the character to fight for teachers, parents and students alike?

When those questions are answered, we will know where the Apple drops.

End Note: For those who wish to study MCPS’s funding history, we reprint the following graphic from the County Executive’s recommended FY18 budget below.

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Adam Pagnucco, David Moon, District 20, District 39, Kirill Reznik, Nancy King, Shane Robinson, Will Smith

Campaign Finance Reports: Districts 20 and 39, January 2018

By Adam Pagnucco.

District 20

Everybody in this district is broke, including the incumbents.  Gone are the days when Jamie Raskin, Sheila Hixson, Heather Mizeur and Tom Hucker were raising money hand over fist and Jonathan Shurberg was writing himself six-digit checks!

If money is not a differentiator, the landscape will favor the three incumbents: Senator Will Smith and Delegates David Moon and Jheanelle Wilkins.  We anticipate that the three will team up, combine resources, get most if not all of the institutional endorsements and be reelected.  That leaves a contest for the open seat being vacated by the Queen of District 20, long-time Delegate Sheila Hixson.  Lorig Charkoudian, who runs a community mediation non-profit, has deep roots in Takoma Park and has been an advocate on progressive legislation at the state level (including abolishing the death penalty).  She finished second for last year’s Delegate appointment to Wilkins.  Howard University professor and volunteer fire fighter Darian Unger ran for the House in 2014 and finished fifth.  In that race, Unger was endorsed by the Washington Post, the Gazette, the Volunteer Fire Fighters, the Sierra Club and the League of Conservation Voters.

The Big Question: will there be a mixed slate featuring the incumbents and either Charkoudian or Unger?  Such an event would be a repeat of 2014, when incumbents Raskin and Hixson teamed up with newcomers Moon and Smith to sweep the primary.

District 39

We should run a poll of Seventh State readers on whether this district is messier than District 17.  Last time, the four incumbents – Senator Nancy King and Delegates Charles Barkley, Kirill Reznik and Shane Robinson – had no primary opponents and cruised to reelection.  This year, Barkley’s decision to run for County Council At-Large has opened a seat.  MCGEO President Gino Renne threatened to defeat Reznik last May a month after Renne’s employee, Gabe Acevero, began his campaign for the House.  Shortly thereafter, the incumbents chose to slate with newcomer Lesley Lopez and it was Game On.  Just last week, County Executive Ike Leggett piled on, endorsing Acevero and accusing the incumbents of slating with Lopez in a “smoke-filled room.”  That’s an ironic comment from Leggett considering that he was first elected in 1986 as a new candidate invited by incumbents onto a mixed slate.

Putting aside the admittedly fun political food fight, the data above shows one salient fact: no one has any money except the incumbents.  That’s a big deal for Lopez as she can benefit from pooled resources with the rest of her slate.  Acevero’s path to victory necessitates rolling up lots of labor support – and not just from MCGEO and its affiliates – and raising enough money to break through.  That’s not easy to do in this district, which lacks the legions of liberal activists of District 20 and the wealthy neighborhoods of Districts 15, 16 and 18.

The Big Question: will the tumult over the incumbents’ mixed slate filter down to the voters or is it just something that the chattering class (and obsessive bloggers) will yap about?  If it’s the latter, the slate strategy could pay off.

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Adam Pagnucco, Al Carr, Ben Kramer, Bonnie Cullison, Dana Beyer, District 18, District 19, Jeff Waldstreicher

Campaign Finance Reports: Districts 18 and 19, January 2018

By Adam Pagnucco.

District 18

Delegate Jeff Waldstreicher has posted a strong financial performance in his run to succeed Senator Rich Madaleno.  He has raised more money over the cycle and has more cash on hand than any other state legislator in the county.  But Dana Beyer has spent nearly a half million dollars of her own money in her three prior races and could spend a whole lot more.  Beyer told Bethesda Magazine “she does not plan to self-finance this year’s Senate bid” but still gave her campaign $109,100.  While Waldstreicher’s cash on hand advantage is substantial, Beyer could erase it with one check.

The recent endorsement by SEIU Local 500 of Beyer may have a big impact on this race.  Prior to that, Waldstreicher could make the case to other progressive endorsing organizations that as a three-term incumbent running against someone who was for 0-3 in elections (two running against him) that he would have a big edge and was the safe pick.  But SEIU is a huge player and brings credibility to Beyer’s run.  Now the endorsing groups may be more likely to evaluate the two against each other on a level playing field and see Beyer as a true alternative.  Our prediction is that this will not be the last significant endorsement that Beyer receives.

The Delegate race is just as interesting.  Incumbent Al Carr had the most raised over the cycle but also has a huge burn rate (81%).  He trails Mila Johns and Jared Solomon in cash on hand.  Johns leads in cash position (boosted by her $100,000 loan to her campaign) while Solomon led the non-incumbents in fundraising from others ($42,011).  Emily Shetty has been a prominent local player since her fourth place finish last time, joining the county’s Democratic Central Committee and doing work with Action Committee for Transit and her former civic association.  But she doesn’t want to trail in money behind Carr, Johns and Solomon to the extent she is now.  Town of Chevy Chase Council Member Joel Rubin’s cash balance is deceptively low since he began campaigning in November and raised $269,845 in his 2016 run for Congress.  Leslie Milano created her campaign account too late to file a January report but says she plans to raise $150,000.  Helga Luest was also a late starter.  Normally, the only incumbent in a race like this – in this case, it’s Carr – would be favored for reelection.  But the challengers are a pack of hungry wolves and Carr is going to have to work to keep his seat.

The Big Question: will there be competing slates in this district?  Both Beyer and Waldstreicher have money, which is much needed by all the House candidates.  Our prediction is that any move to set up a slate by either Beyer or Waldstreicher will provoke the other side to unify too.  Competing slates aligned with contested Senate races were common in District 18 decades ago and another one could really scramble this election.

The Other Big Question: will Delegate Ana Sol Gutierrez stay in the Council District 1 race, where she has not qualified for public matching funds and ranks a distant fifth in cash on hand, or will she return to the District 18 House race?

District 19

With the departure of Senator Roger Manno, who is running for Congress in District 6, Delegate Ben Kramer will become the next Senator and the dominant politician in the district.  Kramer, who was first elected to the House in 2006, is known for his work on senior issues and public safety, and has been a true hero in his efforts to crack down on drunk driving.  He has an absolute lockdown on Leisure World and Kemp Mill, two vital power centers in the district.  Kramer is not universally beloved, but he is well respected and no other politicians will mess with him.  In politics, that is enough!

The two incumbent Delegates, Bonnie Cullison and Marice Morales, will sweep virtually all the progressive endorsements and be reelected.  As for the seat being vacated by Kramer, the simple view is that former Raskin campaign aide Vaughn Stewart, who totally smoked the field (including the incumbents) in fundraising, will win it.  But the race may not be that simple.  MCDCC Member and labor attorney Marlin Jenkins did reasonably well in fundraising and should get a lot of labor support.  And attorney Charlotte Crutchfield, who barely lost to Morales for the open House seat in 2014, is running again.

Crutchfield is not a strong fundraiser, having collected just $11,960 from others last time while self-financing $44,149.  But she has a long history in the district and Kramer formed a slate with her in 2014.  Manno endorsed Morales, his former legislative aide, and Morales won by 382 votes.  Crutchfield filed an affidavit as her January report but her new campaign has just started.

The Big Question: will Kramer team up with Crutchfield again?  And if he does, will Cullison and Morales also join in?

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Adam Pagnucco, Ariana Kelly, Bill Frick, Cheryl Kagan, District 16, District 17, Jim Gilchrist, Kumar Barve, Marc Korman, Susan Lee

Campaign Finance Reports: Districts 16 and 17, January 2018

By Adam Pagnucco.

District 16

First, the easy part: all three incumbents – Senator Susan Lee and Delegates Ariana Kelly and Marc Korman – are running as a team and are headed to reelection.  Lee has historically been one of the delegation’s best fundraisers (although Korman surpassed her by a little bit this cycle).  Kelly is beloved by advocates for families, women and children for her work on their issues and has emerged as a leader on ridding Annapolis of sexual harassment.  Korman is a rare bird: a lawyer who is good with numbers.  Metro riders everywhere should thank him for his tenacious work to improve WMATA.  Great things are predicted for Korman so long as he does not return to blogging.

Attorney Sara Love and MCPS teacher Samir Paul are the top non-incumbents vying for the seat being vacated by Delegate Bill Frick, who is running for County Executive.  Love and Paul would be great candidates in any part of the county, but unfortunately for them, they are running in the same district.  Love fits in well with the progressive female voters who dominate District 16 primaries.  Paul is a teacher who has been active in MCEA (which has endorsed him), but his message is much bigger than education as he draws links between all public institutions that confer benefits but require investment, especially WMATA.  Love and Paul had super fundraising performances and are essentially equal in cash on hand.  Those who have met them are impressed with both of them, but sadly, there is only one open seat.

The Big Question: will Frick, who filed a disappointing January report, drop back down to the House race?  We know Frick does not enjoy that question, but since he withdrew from the Attorney General’s race and refiled for Delegate at the last hour in 2014, this is on everybody’s mind.  Such a move by Frick would probably result in all four incumbents being reelected, wasting huge time and effort by Love and Paul.

District 17

This district is a mess.  The only certainty here is that Senator Cheryl Kagan and Delegate Kumar Barve will be reelected, assuming that Kagan is not picked up by a gubernatorial candidate as a running mate.  As for everything else… well.

At the root of the mess is Delegate Jim Gilchrist.  By all accounts, he is a nice guy who never causes trouble.  His defenders describe him as a studious, intellectual workhorse who gets into the weeds and doesn’t claim credit for anything.  But he has little tangible to show for three terms in office.  He has passed no signature legislation.  His website is inactive.  His Facebook page has not been updated since 2014 as of this writing.  And his fundraising is weak.  Consider this: since 2006, Gilchrist has raised a total of $83,217 from others, an average of $27,739 per cycle.  (He has also self-financed $11,120 over that period.)  MoCo has a bunch of candidates who can raise $27,000 in a month.

The search result for Gilchrist’s website less than five months from election day.

So why does he keep winning office?  He has a guardian angel: Barve, who is his committee chair and likes him.  Barve slates with him regularly and appears in joint mailers with him.  Gilchrist would be a goner in most districts, but with Barve helping him, he survives.  And that has caused grumbling in some parts of District 17.

This time, Rockville City Council Member Julie Palakovich Carr decided to run for Delegate in July even when it appeared that all three incumbents (Barve, Gilchrist and Andrew Platt) were running for reelection.  Six months later, Platt dropped out and Barve and Gilchrist quickly decided to slate with Palakovich Carr.  That’s when simmering tensions erupted into the open.

Kagan, who is no fan of Gilchrist, announced that she was not endorsing the Delegate slate, at least not yet.  This is almost unheard of; in virtually all cases when incumbent Delegates form a slate and none of them are challenging the sitting Senator, the Senator participates.  And when Kagan posted her decision on Facebook, the Mayor of Gaithersburg and two Gaithersburg City Council Members voiced their displeasure with the slate.

Open dissatisfaction with the Delegate slate surfaces on Kagan’s Facebook page.

The nominal reason expressed by some for their unhappiness is that with the inclusion of Palakovich Carr, all three slate members are from Rockville and none are from Gaithersburg.  (The two cities are roughly equal in size.)  But lurking underneath is festering discontent with Gilchrist’s performance in office.  Some would prefer open competition in part because it might lead to Gilchrist’s defeat, but instead they got another slate designed to protect him.  Two Gaithersburg House candidates – school board member Rebecca Smondrowski and attorney Julian Haffner (who is married to a City Council Member) – have now entered the race.  Barve is the only Delegate candidate with any real money, so all the others have a lot of work to do.

The Big Questions: will the Gaithersburg grumblers step up and organize for one or more of the House candidates from their city?  Or will they cut their losses and make their peace with Barve and his slate-mates?  And what, if anything, will Kagan do?

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