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Council Gets in the Way of Schuh’s Goals

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For elected chief executives, legislators are at best a rubber stamp, but more often they are annoying second-guessers. And, at worst, they are roadblocks to policy and political goals.

Anne Arundel County Executive Steve Schuh, a former two-term Republican delegate, was clearly expecting his Republican-majority county council to be fully onboard with his program to trim property taxes, but yet spend more on targeted areas, such as schools and public safety. He had promised these moves throughout last year’s campaign.

Prince George’s County Executive Rushern Baker, a former two-term Democratic delegate, was anticipating much the same sort of cooperation from his totally Democratic council as he sought to raise taxes to fund schools.

Neither got what they wanted.

Both were stymied by members of their own parties, though in Schuh’s case three out of the four GOP council members were happy to go along with Schuh’s plans.

It was Republican Council Chairman Jerry Walker who got in the way of Schuh’s ambition, just as Walker had sided with council Democrats to choose Laura Neuman as county executive over Schuh and other Republicans who had put themselves forward in 2013 as potential replacements to replace John Leopold.

Schuh Gets a Little

By the end of the process in late June, Schuh got just a little of what he wanted in slight cuts to property taxes and the local income tax rate. The council did not accept his more dramatic shift in policies, including a change in the term of county bonds from 20 years to 30 years. This would have allowed more borrowing for projects, as Schuh wanted, but more interest payments in the long run.

Schuh pressured, negotiated and cajoled the council and urged residents to lobby for his program. Ultimately, he lashed out at the council’s “liberal majority” that included Republican Walker, despite their votes for small tax cuts.

“I’ve found that when people resort to name calling, it’s because they’ve lost the policy debate,” Walker posted on his Facebook page. “If name calling worked, then I wouldn’t have won re-election … sticks and stones.”

Supporters of Schuh had hoped to defeat Walker in last year’s Republican primary, but Walker got 55% of the vote against Michelle Corkadel.

Tax Cuts, Bond Rating

Schuh’s push for tax cuts was consistent throughout his campaign.

As he told a breakfast gathering of businesspeople put together by various local chambers of commerce, “Anne Arundel is a relatively high-taxed county in a very high-taxed state.”

Schuh said Maryland was the fourth highest taxed state in the nation, Anne Arundel County was the ninth highest taxed county in the state, putting it lower than all of its neighbors on the Western Shore of the Bay. Then he said he was committed to making “at least one significant tax or fee reduction each year of my term.”

While lower taxes might attract more businesses and stimulate economic growth in the long term, they reduce revenues in the short term, making it harder for Schuh to achieve his other goals. These include aggressively improving stormwater management to improve the health of the bay, reducing the size of county high schools and building public boat ramps — the county has the most trailered boats in the state of Maryland and yet only one public boat ramp.

To fund these and other capital projects, Schuh wanted to extend the terms of the county bonds.

“Our capital program is hamstrung, straight-jacketed,” Schuh told the business folk. He made the analogy with extending a car loan from five years to six, allowing a buyer to get a more expensive car with the same monthly payment.

But extending the loan terms forces both the county and the car buyer to pay more interest in the long run.

Schuh said he was even willing to accept a AA bond rating from the credit rating agencies. Standard & Poor’s has given the county a AAA bond rating for at least eight years, while Fitch and Moody’s offered AA+ and Aa1, respectively.

The state of Maryland views its AAA rating from all three rating agencies as almost sacrosanct. The AAA bond rating helps lower the interest rates Maryland pays on its general obligation bonds. The agencies frequently cite Maryland’s “prudent” fiscal management, that includes selling bonds for 15 years, rather than longer periods.

Despite that, Schuh said most states and counties have AA ratings, as do most corporations. “That’s the way I intend to run the railroad,” said Schuh. “I told the bond rating agencies of my plans, and they didn’t bat an eye.”

It was an unusual move for a fiscal conservative in a conservative county, and the council refused to go along.

Quiet on the Council

There was a big media flap and a ton of Democratic angst about Michael Peroutka during the campaign after he won the GOP primary for Anne Arundel County Council District 5 with heavy personal spending. He did the same in the general election in perhaps the most Republican of council districts, which is centered in Severna Park.

Peroutka is a constitutionalist, a former nominee for U.S. president of the Constitution Party, and a fervent believer in God and the Bible as the basis for all our rights and our constitutional system. He was also associated with the secessionist League of the South.

A recent talk he gave to the North Anne Arundel County Republican Club showed he hasn’t changed his views one bit. But he’s been remarkably quiet on the county council, choosing to listen and learn.

“There’s a massive amount of new data I’ve had to get my hands around,” he told about 35 people, most of whom seemed very much on his wavelength.

“My life on the council has been very, very collegial,” Peroutka said. To his surprise, “People have been very gracious to me.”

That doesn’t mean he’s been going along with the three Republicans and three Democrats on the council. Oftentimes, he is the lone vote against what might considered fairly routine legislation.

Peroutka uses a 10-question template for deciding whether to support council bills. The questions are topped by whether the legislation “comports” with the U.S. Constitution, the Maryland Constitution, the county charter and “Is the legislation in accordance with biblical standards for law and government?”

While Peroutka supported Schuh in his proposal to cut property taxes, along with colleagues Derek Fink and John Grasso, he was the lone vote against the entire county budget, which passed 6-1.

“There are a lot of 6-1 votes,” Peroutka said.

On the budget, “a lot of what we do, we don’t have the authority to do,” he said, estimating that was about three-quarters of the Anne Arundel County budget.