Up the Street
The week that was in Annapolis
Issue of the Week: Dissecting the “Teacher Tax”
Governor O’Malley’s pension proposal counts on generating about $120 million in this budget year, mostly through increased employee contributions to the pension system from 5% of pay to 7% of pay. Our contributions would still go to the pension fund, but instead of the state meeting its recommended contribution, they pass along the “savings” from this increased contribution to relieve the budget deficit pressure on the general fund. This shell game is nothing more than a 2% tax on educators and state employees, which is why it has been dubbed the “Teacher Tax.”
MSEA has launched an online petition to organize opposition to the “Teacher Tax.” Please use the link to add your name and then please share it with your colleagues, friends, and family and help us send a clear message to the governor and General Assembly that we cannot balance the budget on the backs of Maryland’s educators and state employees.
In addition to the online petition, MSEA members have been working the phones and leaving messages for senators on the issue of the Teacher Tax. On Thursday, February 10 alone, MSEA members left over 250 phone messages asking senators to protect teachers’ pensions so that there is no “teacher tax,” and so our modest benefits are protected.
News and Notes
New Pension Bills In the Mix
Several more pension-related bills have been dropped in the House and Senate this week that take varying approaches to change the current pension system. Some address single elements of the pension plan like the vesting period or retirement age. One, sponsored by Senate President Mike Miller, is more comprehensive and addresses most of the recommendations from the Pension Sustainability Commission. Here are the rundown and very quick summaries of the latest threatening pension bills:
- HB 303 (Sponsor: Nancy Stocksdale) – Increases employee contributions from 5% to 7%.
- HB 305 (Sponsor: Nancy Stocksdale) – Increases the vesting period from 5 to 15 years.
- HB 494 (Sponsor: Susan Aumann) – Increases the vesting period from 5 to 10 years.
- SB 6 (Sponsor: Richard Colburn) – Closes the state’s defined benefit pension system.
- SB 628 (Sponsor: Mike Miller) – As noted above, this bill is the legislative vehicle of the Pension Sustainability Commission interim report.
Maintenance of Effort
Proposed cuts in education aid to counties in the governor’s budget could pose a real problem to the state for maintenance of effort (MOE) enforcement. The state typically has the leverage of increased education dollars to ensure counties meet MOE. With the proposed cuts, that leverage could be lost and counties may choose to even forgo the waiver process. In short, the proposed state cuts create an even greater problem when compounded with the local cuts that would follow.
There are several MOE bills in this session. Senate Bill 53 and House Bill 44 are companion bills that advance compromise legislation that was set to pass last year, but the legislature ran out of time. MSEA testified in support of these bills, with amendments, and will continue to fight for stronger MOE provisions that protect local education spending levels.
The Week Ahead
- Today, February 11, is the House Bill Introduction Date. Any House bills introduced after today will be referred to the House Rules Committee.
- Bill hearings are happening in every committee Tuesday-Thursday next week. Here are some bills we are watching Note: this is not a complete list of bills on our "Watch" or "Testimony" list.
BILL # BILL TITLE
HB 249 State Retirement and Pension System – Direct Mailings by Retiree Organizations
HB 159 Public Funding and Small Donor Act for General Assembly Elections
SB 167 Higher Education – Tuition Charges – Maryland High School Students
SB 262/HB 127 State Board of Education – Financial Literacy Curriculum
Keep the Promise Campaign
- An MSEA Action Alert was sent by text on Thursday to urge activists to sign the “Teacher Tax” petition. It read, “MSEA ALERT: Pension proposals under consideration amount to a 2% teacher tax! Sign our petition against the tax & learn more: http://bit.ly/f1sxzS”
What can you do?
- Call your senator and delegates and tell them about the “Teacher Tax.” This is an opportunity to educate them about a provision of the Governor’s proposal, while also speaking out against it as well as any efforts that reduce benefits.
- Keep the pressure on by sharing this link and asking members to contact their legislators.