MD Lawmakers Ask for Federal Help to Solve Dam Problem
Farm and Conservation Sense

Governor's Proposed Budget Undermines Critical Land Preservation Program

Open space beside Bay Roberta ZapfIn 1969, Maryland lawmakers created a simple but ingenious system that protects at least a portion of the state’s forests and fields as suburbia rolls like a tide across the landscape.

Lawmakers approved a real estate transfer tax.  A half of one percent of any real-estate transaction is directed into a special fund that, by law, must be spent buying land to create parks and nature sanctuaries. The fund also protects family farms through conservation easements, and pays for urban playgrounds and recreation.

Program Open Space, as it is called, makes logical sense.  Environmental harm from real estate development helps pay for environmental protection.  About 6,100 parks and wilderness areas across Maryland exist today because of the real estate transfer tax, according to the Maryland Department of Natural Resources.  About 19 percent of the state’s land has been protected, while about 20 percent has been developed. 

But over the last three decades, governors and lawmakers have diverted money from this so-called “dedicated fund,” often just to pay for the general operations of government during budget crises.  So far, state officials have diverted more than a billion dollars that should have been used for parks and land preservation, according to Partners for Open Space, an advocacy organization.

Maggie McIntosh at Environmental SummitDuring a February 11 Environmental Summit meeting of conservation organizations in Annapolis, state Delegate Maggie McIntosh, Chair of the House Environmental Matters Committee, raised an alarm about  Governor O’Malley’s proposed budget for the year starting July 1. 

“The governor’s  budget has absolutely not one dime for new projects in Program Open Space,” McIntosh said.  “It’s all debt payment.  And that is stepping over a line that I don’t want to step over.  And I don’t think any of you should.” 

O’Malley’s spending plan for next fiscal year would divert 98 percent of the real estate transfer tax from its intended purpose, land preservation, and instead use the cash to help balance the state budget, according to numbers from the state Office of Budget and Management.

During his campaign for governor in 2006, O’Malley pledged to fully fund Program Open Space.

Some of Maryland’s governors have been better than others about honoring the intended purpose of the real estate transfer tax.  Back in the 1970s, for example, Governor Marvin Mandel used 100 percent of the transfer tax for parks and open space, as did Governor Parris Glendening during the 1990s, according to state figures.

But during a recession in 1981, Governor Harry Hughes started the practice of governors occasionally diverting money from the program to help balance the budget.  Governor William Donald Schaefer followed suit during a budget crisis in 1993.  Governor Robert Ehrlich diverted more than 90 percent of the real estate transfer taxes during the development boom of 2004 and 2005, according to state figures. 

When O’Malley took office in 2007, he kept his word to fully fund Program Open Space, for his first two years.  Then the recession of 2008 hit. O'Malley -– like Schaefer and Hughes -- dipped into the open space fund to help solve a state fiscal crisis.

“When you get in really tough times, you have to begin to make choices to get you through those times,” said Joseph Gill, Maryland’s Secretary of Natural Resources, who was appointed by O’Malley. “In this past year, when the governor put the budget together, he was facing a nearly $600 million budget deficit. … There were not a lot of places to go.”

Gill noted that the state government is still trying to recover from worst economic downturn since the Great Depression.  “We had furloughs,” Gill said in a public radio interview. “There were 5,000 positions that have been eliminated in state government to help to balance the budget. It was just tough. It was tough across the country.”

Since the recession of 2008, O'Malley has redirected 92 percent of the state's real estate transfer tax money (or $693 million) that was intended for land preservation, according to numbers from the state Office of Budget and Management.  The O’Malley administration has replaced some of those missing funds by borrowing $494 million, and the legislature has promised to replace more in future years.

To O’Malley’s credit, the state continued to purchase and preserve land during the depths of the recession.  For example, his administration took advantage of low real estate prices in 2010 to buy and protect more than 4,000 acres of land along the Potomac River in St. Mary’s County.

And the governor has borrowed money to replace some of the funds taken from Program Open Space -– a step that past governors often did not take when they dipped into the fund.

However, the paucity of real estate transfer tax money being used for land preservation in the governor’s proposed budget for next year creates a risk that a bad precedent could carry over into the term of the next governor.

A lack of dedication to the state’s dedicated open space fund undermines the most successful land conservation program in the state’s history -– and one of the premier programs of its kind in the nation.

By Tom Pelton

Chesapeake Bay Foundation

(Photo by Roberta Zapf)


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Why bother preserving it if you plan to let deep pocket corporations set up industrial manufacturing plants on it in the middle of rural residential communities. That's the sort of changed use introduced just last year. Leaves me wondering if there's a connection.

Where exactly did this land preservation happen, Brian? And what corporation built a manufacturing plant in the middle of it?

And yet CBF supports the Rain Tax. How many times is CBF going to be duped into raising funds for politicians to rob?

Developers Rain Tax...subsidized by Tax Payers...robbed by net pollution abatement.

Why not just require developers to address their own runoff and be done with it? It's not like a swale or rain garden at the edge of a parking lot is much to ask of a developer.

You've bought into some propaganda, Paul, and are repeating falsehoods.

The polluted runoff fees are not, in fact, a "rain tax." They are a tax (or fees, more accurately) on blacktop and other impervious surfaces that contribute oil and other toxic chemicals to streams and the Bay.

To say that there is "no net pollution abatement" from the projects funded by runoff pollution control fees is factually wrong. There are decades of solid evidence and scientific studies that prove runoff pollution control systems reduce nitrogen, sediment, and other pollutants. One 2012 report that presents hard evidence of the pollution removal rates is "Recommendations of the Expert Panel to Define Removal Rates for Urban Stormater Retrofits," by Ray Bahr and colleagues working with the EPA Chesapeake Bay Program. You can read that report here:

Developers in many areas are already required to install pollution control devices like rain gardens and swales for new projects.

The pollution control fees are needed for the construction of runoff control systems on existing, older parking lots, and roads and driveways that lack them today.

There is no evidence that politicians are "robbing" (a word that means a criminal taking of money) the stormwater control funds. If you can direct me to any criminal charges filed against elected officials for improperly taking these funds, please do so. Stormwater control fees exist across the U.S. in more than 1,400 counties and cities, with the first approved 40 years ago. If there was criminal theft from these funds, a criminal charge would have surfaced sometime in the last four decades. To my knowledge, no such criminal charges or even allegations have arisen.

So please refrain from making accusations that are not supported by facts.

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