State's cities and towns push to get highway funds back

Wednesday, Nov. 3, 2010

ANNAPOLIS — For the last two fiscal years, Maryland cities and towns have seen millions of dollars set aside for local road maintenance and improvements all but vanish.

As Maryland Municipal League officials last month tabbed the restoration of those funds as their top priority for the 2011 General Assembly session, there might be reason for optimism.

State Transportation Secretary Beverley Swaim-Staley told officials at the Maryland Municipal League fall conference Oct. 22 that titling tax revenues have begun to tick upward, potentially signaling the state's ability to restore some highway user aid in fiscal 2012.

Titling tax revenue, which is the levy collected on vehicle registrations, declined by 21 percent in fiscal 2009, Swaim-Staley said. But a summertime double-digit growth in car sales helps explain a 5.6 percent increase in titling tax receipts in fiscal 2010, which, in turn, could lead to a partial restoration in highway user revenues.

"We were certainly hoping for some growth, so I don't want to set the expectation that because these revenues seem to have stabilized there's going to be a lot of money," she told about 200 attendees. "What I hope it continues to mean is that we can support the program and gradually begin to build back up to the kinds of things that we'd like to do."

Municipal officials are keeping their fingers crossed that the state soon might be able to put more money toward highway user revenues after cutting roughly 95 percent of the funds previously allocated to local governments in the last two fiscal years.

What was once $42.4 million shared by 157 cities and towns across Maryland is now down to just $1.6 million, MML Executive Director Scott A. Hancock said, describing the cuts as "devastating."

That's particularly so for small municipalities that depend on the highway user revenues for basic maintenance like filling potholes and snow removal. They have very few, if any, alternative revenue streams to make up the revenue loss, Annapolis Mayor Joshua J. Cohen said at Friday's conference.

Anne Arundel County saw the largest five-year decline in highway user revenues between fiscal years 2006 and 2011, according to a state budget analysis. In fiscal 2006, Anne Arundel received $30.7 million. This year, it's down to about $585,000, a 98.1 percent decrease, just more than several other counties.

Aberdeen Mayor Michael E. Bennett, who is MML's president-elect, agreed that the smaller municipalities are hardest hit. He visited several in Western Maryland earlier this year and was struck by the impact that state cuts have on towns like Accident in Garrett County, which has a population of about 350 and has few places to turn when state aid is slashed.

The town has been forced to halt all paving projects, and reduce staff hours and salaries, Bennett said.

Both major party gubernatorial candidates have said they intend to restore the highway user money as soon as possible.

Gov. Martin O'Malley (D) has said it will be one of the first things that is returned to prerecession levels once revenue collections rebound. Former governor Robert L. Ehrlich Jr. (R) has promised to restore at least 25 percent of the local transportation aid in his first year in office, saying that he would use money O'Malley has allocated for two big light rail projects to do so.

And with September revenue estimates showing modest economic growth, municipalities have some hope that the worst is over, Hancock said.

"We're hoping that the December revenue estimates when they are released are also going to have good news and if that's true, the monies should be there for this," he said.

abrody@gazette.net