Can a Maryland charter county create its own program offering cash grants to individual public schools that hit performance targets, or does the state's control over education law block that kind of county initiative?

Plain-English summary

Harford County Executive Eileen H. Rehrmann asked the Attorney General whether the county could adopt an ordinance creating a program to grant money directly to individual public schools that met performance standards set by a county-appointed commission, rather than routing that money through the school board's regular budget. Three different attorneys had already reached conflicting conclusions on a 1996 version of the bill: the County Council's attorney thought it was preempted by state education law, the County Attorney thought it was not because it created no burden on the school system, and the county's bond counsel thought it fell within the county's home rule powers.

The opinion sided largely with the County Attorney and bond counsel, but with important conditions. It concluded that a charter county's implied home rule authority under Article 25A, §5(S) includes the power to make grants to public schools for a public purpose, and that the State's preemption of the education field, established in McCarthy v. Board of Education, only blocks local action that actually "regulates" within that field, not a purely voluntary, non-binding program that rewards past school performance without imposing new conditions or dictating instructional content. It found the proposed program's core concept was not preempted, but flagged three specific defects in the actual 1996 bill: it improperly required a school board member to sit on the county's commission, it let outside "school improvement teams" rather than school authorities submit funding applications, and it conditioned grants on a commitment about future instructional content rather than assessing only past performance. It recommended the county instead consider the simpler, legally safer route of routing extra funds through the school board under ED §5-103(c).

Currency note

This opinion was issued in 1996. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, program, or preemption analysis mentioned here, particularly since the Maryland School Performance Program referenced in this opinion has since been superseded by different state accountability systems.

Common questions

Could a Maryland county just give money directly to individual schools instead of going through the school board's budget?
Yes, according to this opinion, but only if the arrangement was purely voluntary and noncontractual: a school could not be required to participate, could compete for a grant based only on past performance, and the county could not use the grant to impose future conditions on how the school operated or what it taught.

Why wasn't this considered illegal "regulation" of education, since money and schools were involved?
The opinion explained that Maryland's implied preemption doctrine, as developed in cases like McCarthy v. Board of Education and Allied Vending v. City of Bowie, blocks local governments only from creating enforceable rights or obligations within the education field, not from taking nonregulatory actions like offering optional recognition; since the county could not force any school to apply for or accept a grant, and the school board's own standards would control if there were ever a conflict, the program did not "regulate" education.

What specifically was wrong with Harford County's actual 1996 bill?
The opinion identified three problems: it required a Board of Education member to serve on the county's grant commission, which a local ordinance cannot mandate for someone whose duties come solely from state law; it let "school improvement teams" of teachers and parents apply for funding directly rather than requiring the school's own administration to approve applications; and it conditioned grants on a commitment that the money would be used consistently with a school improvement plan and help increase performance, which the opinion read as impermissible county involvement in future program content rather than a reward for past results.

Background and statutory framework

Harford County's proposed Bill 96-21 would have created a 13-member county commission, including one board of education member, empowered to set performance standards and award incentive funds to individual schools that met them, funded through a $500,000 county budget appropriation and involving applications from "school improvement teams" of teachers and parents. The opinion analyzed the county's implied grant-making authority under the Express Powers Act, Article 25A, §5(S), which Maryland courts have broadly interpreted to authorize county spending for public or semi-public purposes, and weighed it against the State's education preemption doctrine established in McCarthy v. Board of Education and refined in later cases like Allied Vending, Inc. v. City of Bowie, which the opinion read as limiting local governments only from actually "regulating" within a preempted field, not from all activity that merely touches on it.

The opinion also examined specific Education Article provisions that could independently limit the program: ED §§4-107 and 4-205, which vest local educational policy-making authority in the county board of education and superintendent; ED §4-111, requiring county boards to maintain citizen advisory committees (found not implicated here); ED §5-202's complex "maintenance of effort" provisions, which the opinion treated as preempting a county's ability to create a parallel direct-funding system tied to future programmatic conditions; and ED §5-103(c), which lets a county provide funds above the maintenance-of-effort minimum to the school board "to support improved and additional programs," identified as the legally safer, cooperative alternative to a standalone county grant program.

Citations and references

Statutes:
- ED §4-107 and §4-205, vesting local educational policy-making authority in the county board of education and superintendent
- ED §4-111, requiring each county board to establish at least one citizen advisory committee
- ED §4-113(a)(1), requiring property granted or devised for a particular public school to be held in trust for that school's benefit
- ED §5-103(c), authorizing county governments to provide funds above the maintenance-of-effort minimum to support improved and additional school programs
- ED §5-202 and §5-202(b), §5-202(b)(3)(ii)2, the local maintenance-of-effort funding requirements
- ED §5-203.3, the 1996-enacted State Superintendent recognition award program tied to the Maryland School Performance Program
- Article 25A, §5 and §5(S), the Express Powers Act provision authorizing charter counties to pass ordinances proper to executing their enumerated powers and maintaining the peace, good government, health, and welfare of the county

Cases:
- McCarthy v. Board of Education, 280 Md. 634, 374 A.2d 1135 (1977), establishing implied State preemption of the education field
- De Canas v. Bica, 424 U.S. 351 (1976), cited on the effect of preemptive law even on harmonious local legislation
- Mayor and City Council of Baltimore v. Sitnick, 254 Md. 303, 225 A.2d 376 (1969), and County Council v. Montgomery Ass'n, 274 Md. 52, 333 A.2d 596 (1975), on the purpose and scope of implied preemption
- Howard County v. Potomac Elec. Power Co., 319 Md. 511, 573 A.2d 821 (1990), an example of impermissible local "trespass" through regulation in a preempted field
- English v. General Electric Co., 496 U.S. 72 (1990), the federal preemption analogy on regulating within an exclusively occupied field
- Allied Vending, Inc. v. City of Bowie, 332 Md. 279, 631 A.2d 77 (1993), the leading Maryland implied-preemption case distinguishing regulatory local ordinances from nonbinding local action
- Snowden v. Anne Arundel County, 295 Md. 429, 456 A.2d 380 (1983), and Prince George's County v. Chillum-Adelphi Vol. Fire Dep't, Inc., 275 Md. 374, 340 A.2d 265 (1975), on a charter county's implicit authority to expend funds for a public purpose
- First Nat'l Bank of Birmingham v. Walker County Bd. of Educ., 11 So. 2d 297 (Ala. 1943), cited on a local government's authority to grant funds to a public school
- Pennhurst State School and Hospital v. Halderman, 451 U.S. 1 (1981), cited on contractually conditioned grant programs
- Ramos v. Montgomery, 313 F. Supp. 1179 (S.D. Calif. 1970), cited on preemption not being implicated by a government voluntarily spending more than required

Source

• Landing page: https://oag.maryland.gov/resources-info/Pages/attorney-general%E2%80%99s-opinions.aspx
• Original PDF: https://oag.maryland.gov/resources-info/Documents/pdfs/Opinions/1996/81oag26.pdf

Original opinion text

26 [81 Op. Att'y

                       EDUCATION

P UBLIC S CHOOLS ) C HARTER H OME R ULE C OUNTIES )
A UTHORITY OF C OUNTY TO A DOPT S CHOOL P ERFORMANCE
G RANT P ROGRAM

                    November 15, 1996

The Honorable Eileen H. Rehrmann
County Executive of Harford County

 You have requested our opinion whether Harford County may

adopt, by ordinance, a program to provide grants to individual public
schools as a reward for achieving performance standards set by a
county-appointed commission.

  A county grant program raises a legal issue only to the extent

that the program is administered outside the existing statutory
framework for county financial support of a school system. Under
§5-103(c) of the Education ("ED") Article, Maryland Code, Harford
County may provide additional funds to the board of education "to
support improved and additional programs." This provision surely
contemplates a cooperative effort between the county and the board
to identify criteria for these additional funds. We recommend that
this cooperative approach, which is free of legal doubt, be given first
consideration.

 Nevertheless, should the county wish to pursue a more

independent approach in encouraging improved school performance,
the county may do so in a limited way. In our opinion, a charter
home rule county like Harford County may establish a performance
incentive grant program if the program is a purely voluntary,
noncontractual arrangement that rewards past performance and
neither imposes future conditions on the operation of local schools
nor interferes with the discretion of State and local educational
authorities. Certain features of a proposed 1996 Harford County
ordinance do not satisfy this condition, although we believe that it is
possible to fashion valid county legislation.

                             I


                       Background

A. The 1996 Proposal

  On April 2, 1996, Bill 96-21 was proposed by the Harford

County Administration and introduced in the County Council to
establish a "school-based performance incentive program."
Although this measure was not enacted, we understand that you hope
to resubmit similar or modified legislation for the Council's
consideration.

  The 1996 bill would have created the Harford County

Commission on School Board Performance Incentive Program ("the
Commission"), a county body of 13 persons, including one member
of the Harford County Board of Education. The Commission would
be authorized to establish objective performance standards for local
public schools and to provide a program of incentives to individual
schools in the county that are meeting, exceeding, or making
significant progress toward meeting these standards. The legislation
contemplated the submission of funding proposals by individual
"school improvement teams," composed of teachers and parents, that
were obliged to demonstrate that the funds spent "will help increase
school performance," be consistent with the school's improvement
plan, and not be used to supplement ordinary operating costs. Had
this measure passed, it would have been funded through a $500,000
appropriation in the county's budget ordinance.

B. Conflicting Opinions

 The issue of the county's authority to establish a school-based

performance incentive program has been the subject of three
opinions: one written by the attorney for the County Council, one by
the County Attorney's Office, and one by the county's bond counsel.

 The Council Attorney concluded that Bill 96-21 was

preempted by State law:

           The bill, in effect, establishes a
       commission which will promulgate policy
       regarding how schools will receive additional
       monies above and beyond that which is
       provided for within the State mandated budget
       scheme. In other words, Bill 96-21 appears to
       create an additional category not authorized
       by state legislation and not included in the
       board of education's budget.

Memorandum to Council Members from Council Attorney (May 27,
1996).

  By contrast, the County Attorney opined that the legislation

was not preempted, because "the program creates no requirement or
burden on the school system [and] because the program is no more
than an additional 'prize' or 'award' for which the schools are free
to compete - subject only to the direction of the school system
hierarchy." Opinion of the County Attorney (May 24, 1996). The
County Attorney also concluded that grants under the program
would be "one-time money" exempt from maintenance-of-effort
requirements imposed by ED §5-202.

  Finally, the law firm of Miles and Stockbridge, the county's

bond counsel, concluded that establishment of the grant program
was within the county's home rule powers under Article 25A, §5(S),
and was not in conflict with or impliedly preempted by any
provision of the Education Article. Memorandum to County
Executive (May 28, 1996). Specifically, this opinion noted that the
incentive program was not part of the budgetary process and that
State law did not prevent alternative sources of school funding
outside the mandatory budget process.

                             II

          County's Authority to Make Grants

  Although the Express Powers Act for charter counties, Article

25A, §5 of the Maryland Code, makes no specific mention of a
county's power to make a grant or a gift to public agencies or
institutions, we believe that this authority is implicit in the Act.
Specifically, §5(S) provides, in relevant part, that a charter county
is authorized:

       [T]o pass all ordinances, resolutions or
       bylaws, not inconsistent with the provisions of
       this article or the laws of the State, as may be
       proper in executing and enforcing any of the
       powers enumerated in this section or
       elsewhere in this article, as well as such
       ordinances as may be deemed expedient in
       maintaining the peace, good government,
       health and welfare of the county.

            Provided, that the powers herein granted
        shall only be exercised to the extent that the
        same are not provided for by public general
        law....

 This provision has been interpreted broadly to authorize the

expenditure of county funds to private or semi-private entities as
long as a public purpose is served. See Snowden v. Anne Arundel
County, 295 Md. 429, 435, 456 A.2d 380 (1983) (indemnification of
county police and fire department personnel); Prince George's
County v. Chillum-Adelphi Vol. Fire Dep't, Inc., 275 Md. 374, 381,
340 A.2d 265 (1975) (grants to volunteer fire companies).[1] In our
view, this authority includes the power to make a grant for a public
purpose to a public entity, such as a public school located within the
county, to the extent that the grant is not inconsistent with or
preempted by State law. See First Nat'l Bank of Birmingham v.
Walker County Bd. of Educ., 11 So. 2d 297 (Ala. 1943); 15 Eugene
McQuillen, Municipal Corporations §39.25 (3d ed. 1995).

                                III

               Preemption and Conflict Issues

A. Implied Preemption and the Education Article

  In McCarthy v. Board of Education, 280 Md. 634, 374 A.2d

1135 (1977), the Court of Appeals held that a charter county lacked
the power to require a board of education to provide bus
transportation for parochial school students. This holding was based
on a finding of implied preemption: State legislation in the field of
education, the Court concluded, "demonstrates the occupation of that
field by the State." 280 Md. at 651. Therefore, a charter county
"was without power to legislate in this field and to place additional
duties upon" the board of education. Id. The force of this implied
preemption would invalidate even local legislation that is
"harmonious" with State law. Cf. De Canas v. Bica, 424 U.S. 351,
356 (1976) (describing effect of preemptive federal law). Thus,
because the proposed county incentive program relates to the field
of education, the question arises whether McCarthy precludes this
particular exercise of county power. In our view, it does not.[2]

  The subject of the incentive program, financial aid for schools,

falls within the core of the "field" occupied by the State.[3] Yet, this
determination does not end the analysis. In Opinion No. 94-019
(March 31, 1994) (unpublished) and later in court, this office
suggested that the implied preemption doctrine only limits the
authority of a local subdivision to "regulate" by legislation.

The implied preemption doctrine safeguards the General

Assembly's decision "to occupy a specific field of regulation ...."
Mayor and City Council of Baltimore v. Sitnick, 254 Md. 303, 323,
225 A.2d 376 (1969) (emphasis added). The doctrine prevents
"future local government trespass in [an] area of exclusive
legislative authority...." County Council v. Montgomery Ass'n, 274
Md. 52, 60 n. 5, 333 A.2d 596 (1975). Local "trespass" occurs if a
local government purports to create enforceable rights or obligations
within the preempted field - in other words, attempts to regulate
within that field. See, e.g., Howard County v. Potomac Elec. Power
Co., 319 Md. 511, 573 A.2d 821 (1990) (local requirement that
utilities obtain special exception status under local ordinances for
siting of certain transmission lines). Local regulation creates a "dual
system of regulating" the field, a duality inconsistent with the
legislative goal. Montgomery Ass'n, 274 Md. at 64. Cf. English v.
General Electric Co., 496 U.S. 72, 79 (1990) ("[S]tate law is pre-
empted where it regulates conduct in a field that Congress intended
the Federal Government to occupy exclusively.") (emphasis added).

  In its most recent implied preemption case, Allied Vending,

Inc. v. City of Bowie, 332 Md. 279, 631 A.2d 77 (1993), the Court
of Appeals again emphasized the regulatory character of the local
law. The case involved two municipal ordinances that regulated the
location of cigarette vending machines through a licensing
requirement. The Court held these local requirements to have been
preempted by State law. In describing the factors to be examined in
determining whether preemption by implication exists, the Court
asked "whether the local ordinance regulates an area ..., whether the
State law expressly provides concurrent legislative authority to local
jurisdictions or requires compliance with local ordinances, ...
whether the particular aspect of the field sought to be regulated by
the local government has been addressed by the State legislation, ...
and ... whether a two-tiered regulatory process existing if local laws
were not pre-empted would engender chaos and confusion...." 332
Md. at 299-300 (emphases added, citations omitted).

 We construed this language in Allied Vending to mean that,

although a charter county could not legislate to regulate the location
of cigarette vending machines, nevertheless a county was not
precluded from passing a nonbinding resolution encouraging
businesses to remove those machines from their premises. Our
understanding of the scope of preemption was affirmed by the
Circuit Court for Howard County in Allied Vending, Inc. v. Howard
County, Case No. 94-CA-24895 (March 19, 1996) (Sweeney, J.):

           While the Council may not legislate to
       regulate cigarette vending machines, ... the
       Council may pass a non-binding resolution
       expressing its opinion on this issue.
       Resolution 48-1994 does not create liability or
       create a new rule of general application, and
       therefore it is not legislative in the nature of an
       ordinance or law.

  To be sure, the Harford County's school performance incentive

program was proposed to be enacted legislatively as an ordinance.
The County Attorney, however, characterized the measure as a
purely voluntary plan that imposes no burden on the school board:
"The County realizes and accepts the fact that it can neither require
a school to participate in the voluntary program nor require the
Board to order a school to participate." The proposed program,
therefore, hardly amounts to an attempt to "regulate" education. The
proposal is not preempted merely because it touches the field of
education.

 We doubt that any serious legal objection would be raised if

the county's program rewarded schools that performed well, by
county criteria, with a plaque or other form of non-monetary
recognition. The overall preemption issue is no different, however,
simply because the recognition takes the form of a monetary grant.

B. Specific Preemption or Conflict with the Education Article

 Even if Harford County is permitted some nonregulatory

authority in the field of education, the question remains whether the
proposed grant program is preempted by or conflicts with specific
provisions of the Education Article.

      1.    Education policy-making authority

  Undoubtedly, the county board of education and the county

school superintendent make local educational policy in each
subdivision. ED §§4-107 and 4-205. Nevertheless, the County
Attorney has characterized the performance incentive program as
one conferring a prize or award on schools subject to the direction
of the board of education. Accepting this characterization of the
intent of the proposal, we believe that the program will not operate
like many grant programs, under which a recipient is contractually
bound to adhere to various conditions. See, e.g., Pennhurst State
School and Hospital v. Halderman, 451 U.S. 1 (1981). If the
program were one in which county educational policy standards
were imposed by contract on a school receiving county funds, we
would question its validity.

  Rather than impermissibly establishing educational standards

that a school must meet in the future, the county incentive program
is more properly viewed as setting eligibility requirements for a
grant for which a school may compete on the basis of its past
performance. A school is not obliged to seek or accept a grant, and
local education authorities remain free as a matter of policy to direct
a school not to apply for or accept a grant or to accept only with the
approval of the board or superintendent. Indeed, if there were a
conflict between board-imposed performance standards and county-
determined standards for an incentive grant, a school would be
obliged to adhere to the board's standards. As long as this non-
binding, non-contractual program does not interfere with the
discretion of local educational authorities or place conditions on a
school that receives a grant, however, it would not be preempted by
or in conflict with ED §§4-107 and 4-205.

      2.    State School Performance Program

  At its 1996 session, the General Assembly established a

program under which the State Superintendent of Education would
annually distribute recognition awards to elementary and middle
schools that show substantial improvement toward meeting
standards of the Maryland School Performance Program. ED §5-
203.3. We do not view the creation of the State-funded and State-
administered program as barring a county from establishing a
voluntary, non-binding grant program that also rewards school
performance, as long as the program does not infringe on the
discretion of State or local educational authorities. If the two
programs turn out to be incompatible in practice, those in charge of
the school system can simply decline to participate in the county's
program.

        3.   Advisory committees

  Under ED §4-111, "[e]ach county board shall establish at least

one citizen advisory committee to advise the board and to facilitate
its activities and programs in the public schools." This provision
would bar a county from interfering with a school board's duty to
establish an advisory committee. The commission contemplated for
the grant program is not an "advisory committee," however, for it
has nothing to do with advising the school board.

      4.    County appropriation requirements

  It is rare for an enactment to raise a preemption issue when a

local government proposes to spend more than is required for a
mandated program. See Ramos v. Montgomery, 313 F. Supp. 1179
(S.D. Calif. 1970), aff'd, 400 U.S. 1003 (1971) (rejecting federal
preemption challenge to state policy of making higher welfare
payments to foster parents than birth parents).

  The manner in which a county appropriates funds for the

annual budget of the local board of education, however, is controlled
entirely by State law. See 68 Opinions of the Attorney General 236,
238 (1983). The extremely complicated "maintenance of effort"
provisions in ED §5-202(b) reflect a legislative decision to preclude
independent county decision-making about the requirements for
"appropriat[ion of] local funds to the school operating budget ...."
ED §5-202(b)(3)(ii)2. See generally 76 Opinions of the Attorney
General 153 (1991). In our view, State control extends to both
mandatory appropriations to the school budget and discretionary
amounts provided pursuant to ED §5-103(c), which authorizes
county governments to "provide funds that are more than the amount
required by [maintenance of effort provisions] to support improved
and additional programs."

  This provision, as well as others related to county funding of

a school system, may be said to reflect State preemption of a smaller
field within the field of education - namely, fiscal relations between
a county and a board of education. ED §5-103(c), in particular,
might well preempt a county's effort to create a parallel system of
direct funding of individual schools, outside appropriations to the
school board, linked to future "improved and additional programs"
to be supported with those funds. In other words, a county may not
condition eligibility for a grant on a school's agreement to pursue a
particular program of instruction. If a county government, for
example, thinks that more intensive teaching of phonics would
improve reading performance, the county can seek to support its
preferred instructional program through additional funds to the
school board under ED §5-103(c). The county may not attempt to
control instructional content by means of grants to individual
schools.

  Yet ED §5-103(c) does not, in our view, implicitly prohibit a

different county grant program, one that offers individual schools
monetary recognition for successful past performance without any
attempt to specify program content, to interfere with the school
system's prerogative to decide on programs, or to alter any aspect of
the State-regulated budgetary process. The General Assembly itself
recognizes that particular schools might receive grants apart from the
ordinary funding process. "All property granted, conveyed, devised,
or bequeathed for the use of a particular public school ... [s]hall be
held in trust for the benefit of the school ... by the appropriate county
board ...." ED §4-113(a)(1).

   As we see it, the objection to the Harford County proposal is

one grounded in policy concerns, not preemption doctrine. If the
county offers a substantial amount of extra money to schools that
meet the county's performance standards, the school board will find
itself under intense pressure to allow schools to pursue the money.
Even if the county's standards are complementary to those set by
school officials, the pursuit of the county's money might in practice
result in a perceived shift of power away from the school board to
the county.

  Nevertheless, we cannot transform policy concerns into a legal

veto. As long as a county performance grant program remains
within the confines discussed above, it is not preempted by or in
conflict with the budgetary provisions of the Education Article.

C. Defects in Bill 96-21

   Although we conclude that a charter county may establish a

grant program along the lines you have proposed, we do find legal
defects in certain features of Bill 96-21. First, the proposal appears
to require a member of the local board of education to serve on the
Harford County Commission on School Performance. In our
opinion, a local ordinance cannot require such service by a member
of a board whose duties derive solely from State law. Second, the
bill apparently requires funding proposals to be submitted by "school
improvement teams" composed of teachers and parents, rather than
any officer of the school. Because a grant application will make
certain representations as to use of the funds by the school, and
because a school has the absolute discretion to accept or reject a
grant, any application for funding should be made expressly subject
to the approval of school authorities. Third, a school seeking a grant
must agree that use of the grant money will "help increase student
performance and be consistent with [the] school improvement plan."
This requirement suggests impermissible county involvement in
future programmatic content, as distinct from an assessment of past
performance.

                            IV

                       Conclusion

  In summary, it is our opinion that a charter home rule county

may establish a school performance incentive grant program as long
as the program is a purely voluntary, non-contractual arrangement
that rewards past performance and neither imposes future conditions
on the operation of local schools nor interferes with the duties of
State or local education authorities.

                                 J. Joseph Curran, Jr.
                                 Attorney General

                                 Jack Schwartz
                                 Chief Counsel
                                 Opinions and Advice

                                 Robert A. Zarnoch
                                 Assistant Attorney General

[1] On the basis of this authority, a charter county presumably could
establish a similar school performance program if the grant were made, for
example, to a private, non-profit foundation, which in turn donated the
funds to a particular school under criteria developed by the foundation.
We need not consider this alternative, however, given our conclusion
about direct county grants to schools that choose to seek the grants.

[2] Our conclusion is limited to the particular proposal in question, as
construed by the County Attorney. This opinion does not address any
other potential legislative action by a county relating to education.

[3] The boundaries of the preempted field were not drawn by the
Court with precision. In 68 Opinions of the Attorney General 236, 237
(1983), Attorney General Sachs, after focusing on post-McCarthy cases,
noted that "[i]t is by no means entirely clear whether the Court ... intended
to hold that local authority had been wholly preempted in every matter
relating to education."