Impending federal sequestration could damage the fiscal stability of Maryland’s metro counties and leaders of those counties are urging congressional action before the hammer falls on March 1.
With little more power than the bully pulpit, county executives Isiah Leggett, Rushern L. Baker III and Kenneth S. Ulman gathered Tuesday to call on Congress to compromise and stop sequestration.
“It is time to put partisan politics behind us, do the right thing for the country and really for the world,” Leggett, Montgomery County executive, said. “Please do not hold everyone hostage. ... We need Congress to act and to act decisively to pass a long-term budget plan that will provide us much needed stability.”
In an 11th-hour deal last December, Congress temporarily delayed to March 1 the deep cuts that would come with sequestration.
If Congress does not compromise, defense and domestic spending face approximately $1 trillion in cuts over the next 10 years.
In his speech Tuesday morning, President Barack Obama said sequestration was intended to motivate lawmakers to craft a smarter compromise of cuts.
“And here’s the thing: They don’t have to happen. There is a smarter way to do this — to reduce our deficits without harming our economy,” he said of the cuts. “But Congress has to act in order for that to happen.”
Sequestration would affect nearly every aspect of life in metro Maryland, the executives said.
“These are not just numbers on a paper. This is not just petty politics between people down on Capitol Hill. These are actual folks who will not be able to pay their mortgage, pay their rent, or teachers who won’t get grants, or housing vouchers that will go unfilled,” Baker, Prince George’s County executive, said.
“We’re here to say we need a balanced approach and we’ve got to get it done soon,” Ulman, Howard County executive, said.
In Montgomery, the federal job loss piece alone could cost the county as much as $500,000 a day in local income tax revenue, Leggett (D) said. Twenty days of sequestration could mean a loss of $10 million to Montgomery, he said.
Leggett said his estimate only included federal employees, it did not factor losses to the county’s many federal contractors. Comparable estimates were not available for Prince George’s and Howard Counties.
But Baker (D) said about 10 percent of Prince George’s jobs are federal, so if even 10 furlough days are issued, it would mean a loss of $120 million in wages for those residents. Ulman (D) said almost 50,000 Howard County residents have jobs tied to or with the federal government meaning sequestration would bring similar devastation to Howard.
Uncertainty surrounding sequestration has forced the county executives to do their jobs with “one hand tied behind our back,” Ulman said.
Baker said the executives cannot push off when they submit their proposed budgets for fiscal 2014 and sequestration could have significant impact on revenue and spending locally.
Howard County hired an economist to help it analyze the potential effects of sequestration but Ulman said there is so much uncertainty — including where agencies will make reductions, what program will be cut, will those agencies lay off workers and if so how many or will they use furloughs — that he looks to prepare a number of budget scenarios.
For businesses, lack of action by Congress to date threatens to devastate Maryland’s innovation economy, said Gigi Godwin, president and chief executive officer of the Montgomery County Chamber of Commerce.
“Sequestration is nothing less than an assault on small business,” Godwin said.
“It’s just as bad as the fiscal cliff,” said Ginanne M. Italiano, president and CEO of the Greater Bethesda-Chevy Chase Chamber of Commerce.