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Public Statements

O'Donnell Statement on Teacher Pension Shift


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On Monday Annapolis passed a bill to shift the cost of teacher pensions to local governments giving the legislature another $250 million to spend on other programs. This will force local governments to raise $250 million taxes to cover the pensions the first year, and $1.5 billion over five years --in some cases forcing counties to break their own tax laws to support Annapolis priorities.

The full ramifications of unfunded liabilities have not been fully examined yet. As taxes rise, jobs are lost. As businesses and jobs move to a better business climate, tax revenues shrink -- just ask California. In addition, Senate Bill 848, Education -- Maintenance of Effort, mandates yearly increases in county spending which will force local tax increases and forces county governments to ignore property tax caps. This means the 1978 Tax Reform Initiative by Marylanders (TRIM) is effectively dead in Prince George's county, and no one is protected from excessive property tax increases.

On top of this, in January the current federal tax rates are set to adjust upward -- the largest tax hike in American history.

It's time Annapolis keeps its promise to the teachers and fully fund their pensions. The State should not be allowed to run up a county's debt, nor should Washington run up the State's debt. It's time for a tax and spending freeze in government, and for the legislators to look beyond this year's budget to see the full impact on citizens.

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