Educators Call Gov. Hogan’s Grandstanding “Incredibly Disappointing”

Thursday, April 9, 2015
Steven Hershkowitz
(410) 353-0755

Annapolis, Maryland – Earlier today, Gov. Larry Hogan proposed his third supplemental budget without restoring funding for Maryland’s public schools. Betty Weller, president of the Maryland State Education Association (MSEA), made the following statement:

“Gov. Hogan is growing increasingly out-of-touch with the people he is supposed to represent. Educators, students, and parents have been pleading with Gov. Hogan for weeks to release the nearly $70 million in school funding restored by the General Assembly so we can avoid increased class sizes, educator layoffs, and critical program cuts. But he refuses to listen despite overwhelming, bipartisan support in the General Assembly. 

“His third supplemental budget proposal continues to ignore the General Assembly’s work to craft a better budget for Maryland that strengthens the pension system while also ensuring strong funding for public schools today. Gov. Hogan’s apparent eagerness to focus more on 11th hour political grandstanding than on compromise is incredibly disappointing, demonstrates a fundamental misunderstanding of the state’s pension system, and further jeopardizes critical funding for our public schools and students.”

Facts on the pension system:

For the last 13 years, educators have watched their pension system go continually underfunded due to the flawed “corridor” funding method that allowed the state to avoid the full, actuarially recommended annual payment. Bond rating agencies and MSEA have long urged state officials to exit corridor and opt for the actuarial method. The bipartisan plan passed by the General Assembly will finally make this switch a reality in next year’s budget—seven years ahead of schedule.

Despite what Gov. Hogan may believe, the General Assembly did not cut 50 percent of this year’s state pension contribution. Such a statement suggests the governor is unaware that the $75 million supplemental payment is on top of the $1.6 billion that the state is already required to contribute by law this year. He is also apparently unaware that the Senate included a sweeper amendment in its version of the budget that says 50% of state funds not spent in FY2016 go directly to the pension fund. 

The General Assembly’s budget plan will have no impact on the retirement benefits of educators, and it takes zero dollars from the existing pension fund. In fact, Maryland will be the only state in the nation to make supplemental payments in addition to the full actuarial pension contribution—and have an AAA bond rating to boot. The state pension fund remains a reliable source of retirement security as it continues on a sustainable path to full funding.

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