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Fiscal Policy &Virginia politics Richard Falknor on 28 Jan 2011 06:58 pm

Fiscal Experts Rate Maryland and Virginia Governors

UPDATE JANUARY 31! Manhattan Institute (MI) senior fellow E.J. McMahon in the New York Post reports – – “On the eve of what could be the biggest state budget showdown ever in New York, Gov. Cuomo has taken a big step toward delivering on the single most important promise he made to taxpayers in his successful 2010 campaign.On Friday, Cuomo sent the state Legislature a bill capping the annual growth in local property-tax levies at 2 percent a year or the inflation rate, whichever is less. The bill was promptly introduced by the Senate majority leader, Dean Skelos (R-LI), and seems likely to pass in that house as soon as today.”. . . . “For the first time, New Yorkers in most school districts outside New York City would have the ability not only to cap growth in property taxes but also to freeze the levy from one year to the next.” Read the entire McMahon article. If enacted, Democratic governor Andrew Cuomo would give many New York state voters some effective elements of a Taxpayer Bill of Rights before either Maryland or Virginia voters gained similar powers.

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Under the respected Manhattan Institute umbrella, Public Sector Inc. (PSI) has this week published their “Experts Rate the Governors” which they explain is

“. . . a series of short articles. PSI contributors and guests evaluate what governors are saying about public employee issues in their State of the State addresses. This week we’ve rated eight governors, mostly in the northeast, plus Mayor Mike Bloomberg of New York City.”

Here are analysts Eileen Norcross on Maryland, and Joseph Henchman on Virginia. (Click on state names for entire evaluation.)

Maryland

“Despite all the ‘cutting’ from the projected budget baseline, the budget is slated to grow by 3 percent in FY 2012. And the Governor continues to rely on fiscal sleight of hand–moving money to the general fund from the capital budget, and replacing capital funds with new bond issues–a maneuver that will fill $251 million of Maryland’s budget gap. While these small reforms to the state’s pension system are a move in the right direction, they don’t go far enough. Maryland’s pension shortfall isn’t the $19 billion it officially reports; using honest accounting, it’s several times larger, with the system slated to run out of assets by 2024. While bolder reforms are needed, O’Malley has taken a move to defined-contribution pension benefits off the table. O’Malley’s budget is the archetype of an effort to ‘muddle through’ with a patchwork of narrow cuts and accounting gimmicks, instead of real reform to unsustainable compensation practices. As a result, O’Malley earns a grade of D.”

Virginia

“Bob McDonnell came into office in Virginia at the same time as Governor Chris Christie in New Jersey. Conventional wisdom at the time was that McDonnell would achieve great things while Christie would be crippled by an opposing Democratic legislature. Somehow, the opposite has happened: Christie has risen on the national stage after remarkable achievements in his state, while McDonnell has struggled to play a much easier hand in a fiscally conservative manner. Republican legislators have already begun criticizing the pension underfunding, along with plans to borrow against future transportation receipts and to reallocate sales tax revenues. McDonnell’s plans outlined in his speech consequently may have a tough time winning approval. Altogether: C.”

And don’t miss the Josh Barro-moderated podcast on four states: New York, Michigan, Washington, and New Jersey.

Faithful readers know we have written at some length about the “getting and spending” policies of Maryland and Virginia governors — most recently here and here — from a conservative perspective.  

Of course, we shall continue to track these crucial matters — but this evening we wanted you to have the “right take” from the experts for your weekend consideration!





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