.04 Waiver of Maintenance of Effort Requirement.

A. Waiver Requests.

(1) In order to qualify for a maintenance of effort waiver, a county shall make a request for a waiver in writing to the State Board of Education by the earlier of April 20 or the 7th day following the end of the legislative session of the fiscal year prior to the waiver year. The county shall send to the local board of education a copy of the waiver request.

(2) There are three types of waiver requests:

(a) Impeded Ability Waiver;

(b) Agreed on Waiver; and

(c) Rebasing Waiver.

(3) The State Board shall inform the county whether the waiver is approved or denied in whole or in part 30 days after receipt of an application or May 20 of the fiscal year prior to the waiver year, whichever is earlier.

B. Public Hearing.

(1) Upon receipt of the waiver request, the State Superintendent of Schools shall provide a preliminary assessment of the waiver request to the State Board.

(2) Upon receipt of the waiver request, the State Board shall schedule a public hearing.

(3) Notice of the public hearing shall include the time allotment for oral presentation.

(4) The State Board may identify and call upon expert witnesses.

C. Standards for Granting Waivers.

(1) For an Impeded Ability Waiver for a fiscal year, the county shall address whether the waiver request is contested and submit the amount of the waiver request and a full explanation of how each of the following factors impact and support the request for this waiver:

(a) External environmental factors such as a loss of a major employer or industry affecting a county or a broad economic downturn affecting more than one county;

(b) A county’s tax base;

(c) Rate of inflation relative to growth of the student population in the county;

(d) Maintenance of effort requirement relative to the county’s statutory ability to raise revenues;

(e) The county’s history of exceeding the required maintenance of effort amount;

(f) An agreement between a county and a county board that a waiver should be granted;

(g) Significant reductions in State aid to the county and municipalities of the county for the fiscal year for which a waiver is requested;

(h) The number of waivers the county has received in the past 5 years;

(i) The history of compensation adjustments for employees of the county board and county government; and

(j) Other factors, upon request by the State Board.

(2) For an Agreed on Waiver based on an agreed-on reduction in recurring costs, the county must submit:

(a) The amount of the agreed-on reduction in recurring costs by line item in the local board’s budget;

(b) The amount of the waiver request;

(c) A comparison of the requested appropriation level to the amount required by Education Article, §5-202(d)(1)(i), Annotated Code of Maryland;

(d) The document that sets forth the mutual agreement between the county and the local board; and

(e) If the reduction in recurring costs includes reductions in personnel or personnel costs, the document that reflects the agreement of the exclusive employee representative.

(3) For a Rebasing Waiver to rebase maintenance of effort permanently, the county shall:

(a) Have obtained a waiver for a fiscal year under §C(1) of this regulation;

(b) Submit the amount requested to be permanently rebased;

(c) Demonstrate that the county education appropriation under Education Article, §5-202(d)(1)(ii), Annotated Code of Maryland, for the waiver year exceeds 100 percent of the Statewide 5-year moving average of education effort times a county’s local wealth; and

(d) Submit a full explanation of whether and how:

(i) The county is at its maximum taxing authority under the law;

(ii) The county’s education appropriation is commensurate with the county’s wealth;

(iii) The county’s history of exceeding the required maintenance of effort has made meeting the maintenance of effort requirement in future years unsustainable;

(iv) The county has or has not received a rebasing waiver in the past 5 years; and

(v) The factors set forth in §C(1)(a)—(i) of this regulation affect the county’s ongoing ability to meet the maintenance of effort requirement.