State Senate budget panel approves teacher pension shift
County school districts eventually would have to bear $337 million
ANNAPOLIS The Senate Budget and Taxation Committee on Friday approved a plan to shift some of the cost of pensions for teachers, librarians and community college faculty to counties beginning with the 2011-2012 school year.
Under the plan, which must be approved by the full General Assembly as part of the fiscal 2011 budget, counties would assume 1 percent of the wage-based pension costs in fiscal 2012, which begins on July 1, 2011.
The cost would then shift to the counties at 3 percent in fiscal 2013 and at 5 percent in fiscal 2014 and fiscal 2015, when the cost to the counties would be $337.5 million.
"In the end, it makes both the state and the counties financially responsible for the cost of those benefits," said Warren G. Deschenaux, the chief fiscal analyst for the nonpartisan Department of Legislative Services.
The committee also approved cuts of 500 positions from executive departments for the coming fiscal year and of $60 million in state aid to K-12 schools under the Thornton funding formula.
School funding previously had been considered off limits because it was tied to federal stimulus money that was contingent on maintaining education spending.
"We've appropriated more than necessary to retain all the federal funds under the stimulus legislation," Deschenaux said.
Stimulus funding is still an issue, said John Woolums, a lobbyist for the Maryland Association of Boards of Education.
"Boards of education would hope that there would be a more comprehensive discussion of implications for the funding cliff beginning in 2012 when the federal funding through stimulus goes away," he said.
Education advocates said they were surprised that the committee approved the pension shift and then delayed it by a year. The shift has been long discussed, but the proposal was never before acted upon.
"For us, the implications are huge," Woolums said.
Without increases in state aid for schools, school systems will be forced to make cuts, he said, adding that every $100,000 in pension costs means one-and-a-half to two teacher positions.
"It means cutting our existing bottom line, which means cutting positions," he said.