Unclear On The Concept

Shorter Adam Pagnucco to Kathleen Matthews: here’s all the reasons why your campaign for Congress sucks. You know what would really help? Support meeeee!

That’s some quality persuasion right there. Dale Carnegie would be proud.

But even apart from the “insult her, then suggest she support you” problem, the advice is terrible. Already subject to criticism, as I’ve pointed out, for being a “corporate shill and an out of touch rich white woman,” Adam thinks Matthews should run on making it easier to pick up a case of Chardonnay and enriching private liquor interests? Yeah, that’ll go over really well.

I’m sure the Matthews folks’ll be getting back to Adam any day now.

Purple Line Announcement Fakeout

Turns out the January 15 (i.e., today) deadline was not really a deadline. Bethesda Magazine:

Maryland Transit Administration officials are still evaluating proposals from four teams that are bidding to build the estimated $2.2 billion, 16-mile light rail line.

The MTA, in putting out a request for bids, had set Friday as the date it would notify a team it had been chosen to build the project.

Paul Shepard, MTA spokesman, said in a statement sent to Bethesda Beat Friday that the agency is currently in the evaluation and solicitation process and can’t comment until it reaches a final agreement. An announcement about the selected bid is anticipated to occur in February, according to Shepard.

“Note that the Jan. 15 date in the [request for proposal] for proposer selection, which was reported in local news media, was just a guideline for proposers and not a certain date for the selection of any team,” Shepard said, in the statement.

Also still up in the air: how much is this all going to cost, and how much will Montgomery County have to pay? Another Bethesda Magazine article discusses County Executive Ike Leggett’s just-submitted capital budget, which covers six years.

Montgomery County Executive Ike Leggett on Friday recommended a $4.4 billion capital budget for the next six years, a 3.1 percent decrease from the current six-year capital budget that Leggett said allows room for more spending on the Purple Line light-rail and White Oak redevelopment projects despite the county’s budget difficulties.

“We are still negotiating the final details regarding high priority projects such as the Purple Line and White Oak Redevelopment,” Leggett wrote in a memo delivered Friday to County Council President Nancy Floreen. “Therefore, I have held additional fiscal capacity to allow appropriations when needed. As planning progresses for these two projects, I will submit [capital improvements program] amendments to move these priorities forward.”
Leggett also said officials faced “serious challenges” in developing the budget recommendations, including lower-than-expected revenue estimates and the impact of the Supreme Court’s decision in the Wynne tax case, which could cost the county more than $100 million over the next few years.
* * *

The recommended budget includes $192.1 million for four Purple Line-related projects, including $40 million for the light-rail itself that Leggett promised Hogan last summer as the governor moved to cut the state’s share of the costs for the 16-mile system.
The bulk of the $40 million would be spent from 2019 to 2022. Leggett also requested an appropriation for the fiscal year that ends July 1 to buy land in the project’s right-of-way and said full costs and the funding schedule won’t be known “until the state’s negotiations with the selected concessionaire are concluded this spring.”
The county expects construction of the Purple Line to start late this year or early next year and last five years.

A Position I Didn’t Know I Held In An Organization I Didn’t Know Existed

In response to my after midnight post about Adam Pagnucco’s letter to County Attorney Marc Hansen, Barry O’Connell was sufficiently outraged that he wrote the following Facebook post.

Pure comedy gold. “Explaining how to read a legal case” = “scathing blog based hatchet job.” I had no idea. And would it have been a better or worse “hatchet job” if it hadn’t been “blog based”? I’m wondering.

I’ll bet that nobody in Takoma Park knew about the syndicate, much less my appointment as Snarkster in Chief. But I am so pleased with this moniker that I have just now promoted myself from “Line Cook” to “Snarkster in Chief” here at the worldwide headquarters of Maryland Scramble. Look and see:  

Thanks, Barry. I couldn’t have earned this promotion without you.

Don’t Try This At Home

I’ve been a lawyer for almost (gulp) 25 years now. One of my pet peeves when I was in private practice was when clients would offer their own legal advice or even better – this actually happened – advice from their bartender. Which opened up a whole host of other issues, but that’s a different story.

Law is the only profession where people who have no legal training at all feel free to tell attorneys how to do their job. I don’t know precisely why this happens but it seems to be unique to the legal profession. Can you imagine telling your surgeon “hey, listen, I had a friend who had a situation JUST LIKE THIS ONE, so I really think you should consider doing the surgery a different way”? I’ve heard some variation on that request as a lawyer hundreds of times.

I was reminded of this peeve when I read David Lublin’s post about a letter Adam Pagnucco wrote to Montgomery County Attorney Marc Hansen. Adam decided to try to play lawyer – and government professor Lublin decided to title the post “County (Ab)using Liquor Stores for Political Speech.” He’s wrong, and so is Adam. The County is well within its right to speak on the issue, as I will make abundantly clear.

First, the letter. The County is putting out a flyer defending the current alcohol distribution system to customers at its stores. Adam is upset with this, calling it “political speech” as opposed to what he considers to be more legitimate “commercial speech.”

Hello, Mr. Hansen. This is Adam Pagnucco. I am working with a group of folks who are advocating for Delegate Bill Frick’s legislation to allow competition in the county’s alcohol industry.

I am in receipt of the attached flyer which I understand is being distributed in county liquor stores. The flyer is unquestionably a political communication and not a commercial advertisement.

As you know, the state’s Court of Special Appeals has ruled that the county “may speak to advance its existing policies and programs, to advocate for policy changes, and to advocate against policy changes.” http://www.mdcourts.gov/opinions/cosa/2015/0175s14.pdf However, during the Question B campaign of 2012, the county ran ads for its point of view on Ride On buses and denied the Fraternal Order of Police the same opportunity. ACLU of Maryland protested that and the county decided to allow FOP ads, but it was too late in the campaign for the ads to appear. The ACLU wrote, “When the government privileges one side of a political debate in a forum open to private speakers, as Montgomery County is doing here, it engages in viewpoint discrimination clearly prohibited by the First Amendment.” http://www.aclu-md.org/press_room/82

As the County Attorney, here is my question to you. If the county is using its facilities to distribute political speech, as it did with the Ride On buses, can county citizens with a different point of view use those same facilities to also distribute political speech? In other words, can we request that our flyers be distributed along with the county’s flyers?

Adam Pagnucco

Side note: Adam acknowledges in his letter that he is “working with a group of folks who are advocating for Delegate Bill Frick’s legislation to allow competition in the county’s alcohol industry.” Given the number of posts that David Lublin has handed over to Adam on this issue, this offhand disclosure is one that should have been made a long time ago.

Adam has fundamentally mischaracterized the holding of the case he cites, and he ignores the court’s discussion of a series of Supreme Court and other federal cases that actually answer his question directly – in the negative. Leaving the question open – was this an honest inquiry or a publicity stunt? Read on and decide for yourself.

First off the language Adam recites is by no means the actual holding of the case. He maintains that there is a distinction between impermissible “political speech” by the County and permissible government speech. That distinction was rejected by the Court of Special Appeals in the opinion he recites. The second paragraph of the opinion makes this clear:

We hold that the County acted within its powers and not illegally by spending County funds to campaign in favor of the particular ballot issue; and that Leggett and Lacefield did not violate any laws. Accordingly, we shall reverse the judgment of the circuit court.

In its conclusion on the issue of government speech, the Court wrote:

The County used its website, email newsletter, Ride-On buses, public libraries and recreation centers, and vehicles to promote a message: voting to uphold Bill 18-11’s limits on effects bargaining for MCPD officers is good County governance policy. The County communicated to potential voters its view that effects bargaining was detrimental to the County’s efficient and productive management of its police force, and on that basis advocated in favor of Question B. As in Kidwell, the County’s speech was directly related to its governance, was in an area in which it had expertise, and concerned an issue about which the voters were entitled to hear its perspective in deciding how to vote. The County was engaged in government speech.

This is so even though Bill 18-11 had not gone into effect at the time the County engaged in the campaign. As noted, Bill 18-11 was passed during the 2011 County legislative session by unanimous vote and was signed into law by Leggett. A government may speak to advance its existing policies and programs, to advocate for policy changes, and to advocate against policy changes. See Kidwell, supra; Page, supra. As the Page Court emphasized, the check on government speech is that the individuals elected to office whose views the government is then espousing may be voted out of office. See also Sutliffe v. Epping School District, 584 F.3d 314, 331 n.9 (1st Cir. 2009) (“If the voters do not like those in governance or their government speech, they may vote them out of office”). Like the school board in Page, which was comprised of elected board members, the County was led by Leggett, an elected official. OPI is the mouthpiece of the County Executive’s office and Lacefield is a political appointee. If County voters disagreed with the County’s message on Question B or if they disagreed more generally with the County’s choice to engage in a political campaign, they were free to vote out of office those they deemed responsible.

It really couldn’t be more clear. The County is free to spend money on espousing its views on a ballot question, and voters are free to vote the responsible officials out of office.

So what about Adam’s question: must the County allow the use of its facilities to its opponents? The answer, legally speaking, is no. Which is equally clear from the Court of Special Appeals’ discussion of several Supreme Court and other federal cases. 

Let’s look first at a 2005 Supreme Court case called Johanns. Here’s how the Maryland court described the case.

That case was a challenge to the Beef Promotion and Research Act of 1985 (“the Beef Act”), in which Congress announced a federal policy of promoting beef products and funded that promotion through an assessment on cattle sales and importation. Two associations whose members paid the assessment sued, arguing, inter alia, that the Beef Act violated their First Amendment rights by compelling them to subsidize speech they found objectionable. The Supreme Court rejected that argument, opining:

  • Our compelled-subsidy cases have consistently respected the principle that “[c]ompelled support of a private association is fundamentally different from compelled support of government.” “Compelled support of government”—even those programs of government one does not approve—is of course perfectly constitutional, as every taxpayer must attest. And some government programs involve, or entirely consist of, advocating a position. “The government, as a general rule, may support valid programs and policies by taxes or other exactions binding on protesting parties. Within this broader principle it seems inevitable that funds raised by the government will be spent for speech and other expression to advocate and defend its own policies.” We have generally assumed, though not yet squarely held, that compelled funding of government speech does not alone raise First Amendment concerns.

Id. (citations omitted). The Court held that the Beef Act did not violate the association members’ First Amendment rights.

 Two subsequent federal cases are also instructive. The first was a 2006 decision by the Sixth Circuit called Kidwell. Again, from the Maryland opinion cited by Adam Pagnucco.

The city council was using public funds to support a “Vote No” campaign on an issue referred to the voters — whether to overturn a city council resolution establishing a fire department for the city. The city charter expressly authorized expenditures by the city council to inform voters about election issues affecting the municipality, so long as the issues did not involve the election of particular candidates. The taxpayers filed suit, alleging that the city’s use of public funds to advocate (not merely give information about) its position on a ballot issue amounted to compelled speech, in violation of their First and Fourteenth Amendment rights.

Noting that government speech in the context of an election presents “unique constitutional issues,” the Sixth Circuit, in a split decision, held that First Amendment concerns did not justify a “bright-line rule barring such speech, at least where the government speaks within the scope of its governance functions.” Id. at 625 (footnote omitted). It opined:

  • Governments must serve their citizens in myriad ways, including by provision of emergency services, and these activities require funding through taxation. [The city council’s] speech related to emergency service and tax initiatives thus fits squarely within its competence as governor and was made in the context of “advocat[ing] and defend[ing] its own policies.” The issues on which the city advocated were thus germane to the mechanics of its function, and are clearly distinguishable from the hypothetical cases of government speech in support of particular candidates suggested by the dissent. . . . .
  • In this case, Ohio’s home rule system made [the city’s] policies subject to acceptance or rejection by ballot. In this context, a limit on government speech during elections would allow hecklers to silence the government on issues in which it has an interest and expertise-and on which citizens have an interest in hearing their government’s perspective. See Ala. Libertarian Party v. City of Birmingham, 694 F. Supp. 814, 817 (N.D. Ala.1988) (upholding promotional campaign relating to levies where the subject of the campaign was “related to the common needs of all citizens”). Because [the city’s] speech in this case was germane to its role as governor, plaintiffs have failed to show that democratic legitimacy is threatened or that [the city’s] compelled subsidy of its speech violates the Constitution.
  • The natural outcome of government speech is that some constituents will be displeased by the stance their government has taken. Displeasure does not necessarily equal unconstitutional compulsion, however, and in most cases the electoral process-not First Amendment litigation-is the appropriate recourse for such displeasure. See Johanns, 544 U.S. at 563, 125 S.Ct. 2055 (noting the importance of political accountability of decisionmakers). The needs of effective governance command that the bar limiting government speech be high. The plaintiffs in this case have failed to show that the [city’s] expenditures crossed the line separating a valid compelled subsidy from an unconstitutional one, and valid advocacy from prescription of orthodoxy.

The last case is the most relevant, both because it is from the 4th Circuit (of which Maryland is a part) and because it actually answers Adam’s question directly. It’s a 2008 case called Page.

In Page v. Lexington County School District One, 531 F.3d 275, 277 (4th Cir. 2008), the Fourth Circuit reached the same result in a case challenging a South Carolina school district’s use of its website, email, and “other forms of communication” to oppose a bill pending before the state legislature that would grant tax credits to families who home- schooled their children or enrolled them in private school. The school district, which was a “body politic and corporate” under South Carolina law, took the position that the proposed law would undermine the public education system. Id. A citizen who supported the proposed law demanded equal access to the school district’s “‘informational distribution system’” to advocate in favor of the measure. Id. When the school district refused his request, he filed suit, alleging that the school district was engaging in unconstitutional viewpoint discrimination in violation of the First Amendment. The district court granted summary judgment in favor of the school district.

The Fourth Circuit affirmed. Citing Johanns, it opined that it is “well-understood” that “[e]ven though government is supported by the taxes of all, its policies are not supported by all. It follows therefore that the government may advocate in support of its policies with speech that is not supported by all.” Id. at 280. The court emphasized that the government is “‘accountable to the electorate’” for its speech. Id. at 281 (quoting Bd. of Regents of Univ. of Wisconsin Sys. v. Southworth, 529 U.S. 217, 235 (2000)). As relevant here, the plaintiff citizen also argued that “as a general matter . . . the government speech doctrine should . . . never apply when the government attempts to influence legislation.” Id. at 287. He maintained that advocacy of that type is unique because it is not “checked by the ‘ballot box.’” Id. The Fourth Circuit disagreed. Citing Kidwell, it noted that the school board members were elected and were subject to removal in the next election “if the voters disagree[d] with the manner in which they have exercised their discretion.” Id.

Seems pretty clear, huh? So back to my question – was this an honest inquiry or a publicity stunt? Maybe we should ask Adam’s bartender. I bet he has an opinion on the subject. Everyone else seems to have one.

Outsourcing The Liquor Argument

Councilmember Roger Berliner, the lone member of the Montgomery County Council supporting privatization of the county’s liquor monopoly, has a Facebook post up about some of the problems that the Department of Liquor Control had over the holiday season.

There’s a number of comments, but this one is particularly instructive. Until some of the many good questions raised by the commenter are answered, and the suggested actions tried, there is no remotely good reason to do away with the current alcohol distribution system. I agree with the sentiments expressed wholeheartedly and without reservation. We have a first rate county government – if some part of it needs improvement, then do it.


George Leventhal Responds To Franchot Report 

From Facebook:

I like and respect my old friend Comptroller Peter Franchot but I wish he would exercise more due diligence and help Montgomery County government figure out means to mitigate the damage that would be done to our operating and capital budgets by giving away a profitable asset (liquor sales) to private interests and getting nothing in return. It seems imprudent for the state comptroller to pay so little heed to severe consequences for local government’s bottom line. There is a valid discussion underway about whether county control of liquor sales is a good idea and the County Council, with Hans Riemer in the lead, has proposed an approach that would address the legitimate complaints of restauranteurs and aficionados of fine and rare wines and craft beers. If our approach isn’t successful, we can continue to look at how to address consumer complaints but we must also balance our budget, meet our taxpayers’ needs and fulfill our obligations to bondholders. These are real issues that the state comptroller should take seriously.

Speaking for myself, I think there’s a reason the issues raised by Councilmember Leventhal aren’t being discussed. To do so is to acknowledge – which Franchot’s report does not – that there are real financial costs to alcohol privatization that muddy the issue for most voters. It’s far more fun – and simple – to simply grab a bullhorn and yell “cheap hooch for everyone” than it is to engage in a serious dialogue. Montgomery County deserves better.

The Inigo Montoya Alcohol Report

“You keep using that word. I do not think it means what you think it means.”

The word in this case being not “inconceivable,” but “revenue.” Yesterday, Comptroller Peter Franchot held an event to tout his new “report” about all the “revenue” that will be gained by doing away with Montgomery County’s alcohol monopoly. I kept hearing Inigo Montoya’s voice over and over again as I read the report and watched Franchot’s press conference. Franchot and other “reform” advocates like Delegate Bill Frick are acting without apparent concern for the financial and economic well-being of the county. Either they don’t know what they’re talking about or they’re not telling the whole truth. Neither one being a stupid guy, I’ll let you draw your own conclusion. Here’s some facts to help you out.

First off, the “report” was done by Franchot’s own staff. Make of that what you will. More importantly, the “report” sets forth a series of assumptions and then makes calculations about the revenue bonanza that will happen if those assumptions come true. How good are the assumptions? No idea – they didn’t bother to justify them other than by stating – another assumption – that the entirety of the lower alcohol consumption in Montgomery County is due to the evil monopoly. How good is that assumption? Pretty crappy as a matter of logic – how often is any observed variance due solely to one factor? Pretty much never.

But let’s put aside our qualms about the assumptions in the “report.” If all the unicorns and puppies come to fruition, the “report” claims that 1,364 jobs will be created by 2021 (principally in the wholesale liquor industry, which we’ll come back to in a bit), with a net increase in economic activity of $193.4 million. The “revenue” to the state and county will be $56.5 million. That sounds good, doesn’t it?

No, not at all. That’s over four years. So it’s $14 million per year. Remember, the terrible monopoly generates $35 million per year in revenue to the county, right now. That doesn’t include the income taxes paid to the county and state by the workers at the county facilities, nor does it include sales taxes, and excise taxes paid by consumers at Montgomery County liquor outlets as we speak. All of that will go up in smoke, and should in any reasonable projection be counted as an offset. But it isn’t, because the department doing the “report” works for the guy advocating for change.

Second point: talking about revenue to the “state and county” is an obfuscation of the highest order. How much to the state and how much to the county? It’s in there, but neither the Comptroller nor Bethesda Magazine wants to focus on it. Of the $56.5 million in revenue generated by the unicorns and puppies, a whopping $4.28 million will go to the county. Yes, you read that right. Even under the most rosy, “sure, go ahead and piss on my leg and tell me it’s raining” scenario that the Comptroller could concoct, the county’s $35 million in revenue under the current arrangement will be reduced to just over 1 MILLION DOLLARS (ooh, another chance to drop in a movie reference) per year. The state, on the other hand, will garner a nice windfall of $52 million, or around $13 million per year.

There’s more, but you get the idea. What this pie in the sky “report” does, taken on its own terms, is to effect a massive revenue transfer from the county to the state. Maybe somebody should ask why that’s a good idea at a time when the state has an over $700 million surplus, while the county is looking at property tax increases in order to keep pace with its current obligations as a result of the Supreme Court’s decision in the Wynne case and lagging revenues from real property transactions and income tax returns. Plus destroying over 300 middle class jobs that already provide a significant amount of revenue right now.

Final point: Delegate Frick is quoted in the article as follows:

“I think there’s a lot of support from the public, from consumers, from voters,” Frick said. “They need to let their opinions be heard because if all the members are hearing from are special interests, that’s a skewed vision.”

I guess by “special interests” Frick means “labor unions.” What a terrible thing they’re doing – fighting for their members’ jobs and the interests of the county. I’m looking forward to Frick swearing off any labor endorsements in his next campaign. As if. Better question: will any labor union continue to endorse him now?

Curiously absent from those who Frick believes might have an interest in this fight is the liquor industry. Look back again at Franchot’s charts. There’s a lot of growth in jobs in the liquor industry – with those jobs come increased sales, and increased profits. But they’re not “interested”? Intriguing.

Stay tuned. This is only going to get more interesting as we move forward.

New Board Of Education Candidate?

Reliable sources indicate that a new candidate is considering a run for the MoCo Board of Education, most likely in District 2 but potentially in the at-large race. Oscar Alvarenga is the president of the Summit Hall Elementary School PTA, and he was recently voted the PTA President of the Year by the Montgomery County Council of PTAs. Here’s a video of Alvarenga’s reaction to winning the award from earlier this year.

In District 2, the incumbent is Rebecca Smondrowski, while the at-large incumbent is Phil Kauffman. Both have indicated their intention to run for reelection.

Peak Ad Hominem

As attentive readers of this establishment know, there’s a big fight going on over the issue of alcohol distribution in Montgomery County. The chief advocate for change has been Comptroller Peter Franchot, who is advocating for a bill to open up the County’s monopoly on alcohol distribution. Among the many opponents of such a change is MCGEO, the union representing the Department of Liquor Control’s over 300 unionized employees.

There are arguments on both sides of the issue – I’m squarely on the side of retaining the current system, with modifications to allow for private distributors to be part of the special order process. The County Council, the County Council, the union, and others agree. On the other side are several state legislators and the Comptroller who are pushing different versions of a privatization bill in the state legislature, as well as some restaurant and bar owners.

Peter Franchot’s chief of staff, Len Foxwell, decided yesterday that he wasn’t interested in a debate on the issues. He launched an attack on Gino Renne, the head of MCGEO, regarding an incident from more than five years ago that had and has no bearing whatsoever on the alcohol issue.


Ad hominem

An ad hominem (Latin for “to the man” or “to the person”, short for argumentum ad hominem, is an attack on an argument made by attacking the character, motive, or other attribute of the person making the argument, rather than attacking the argument directly. When used inappropriately, it is a logical fallacy in which a claim or argument is dismissed on the basis of some irrelevant fact or supposition about the author or the person being criticized.

Foxwell’s Facebook post is one of the purest forms of ad hominem attack that I’ve seen in many years of state and county politics.

Let’s note that Foxwell isn’t some guy on the street – he’s Peter Franchot’s chief of staff. So this was an attack authorized by one of Maryland’s four statewide elected officials on the leader of a union who represents more than 300 workers with a personal stake in the outcome of this debate. Foxwell thinks it’s OK to marginalize the interests of workers with good jobs and good pay by scoring cheap and irrelevant political points. Moreover, he clearly believes that discussing the merits of the issue isn’t as important as a good ad hominem assault.

Not sure if Foxwell is a lawyer or not, but I am, and I recognize a guy with a bad argument – and who knows it – when I see one. Old trial lawyer saying: “When the facts are on your side, pound the facts. When the law is on your side, pound the law. And when neither one is on your side, pound the table.”

Len Foxwell pounded the table yesterday. Remember that when you’re told what a great idea alcohol privatization is. If the primary proponent of an idea abandons the merits of that idea when the conversation has barely begun, that ought to tell you something.

ICYMI: Post Summary Of Alcohol Issue

Over last weekend, Bill Turque of the Post had a very good writeup of some of the basic questions surrounding the alcohol privatization issues currently being considered by the county’s legislative delegation. I missed it – if you did too, here you go. A snippet to whet your appetite:

Montgomery’s monopoly in the alcohol business — as the county’s exclusive wholesaler of beer and wine and retailer of hard liquor — is under fire.

Two bills due to be considered by state lawmakers early next year would bring big changes to a system that has been in place, in one form or another, since Prohibition ended in 1933.

One measure, sponsored by Del. C. William Frick (D-Montgomery), would ask voters to place a question on the 2016 ballot asking voters whether restaurants, bars and stores can bypass the county’s Department of Liquor Control and purchase directly from private distributors.

The other, more limited proposal, backed by the County Council, would allow businesses to buy “special order” products — fine wines and craft beers — privately. Proponents of both bills say the DLC is not a reliable supplier of special-order items, making deliveries that are sometimes late or incomplete.