Cumberland Times-News

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January 7, 2014

Legislators ready to fight rain tax, among other issues

Edwards believes Maryland’s structural deficit ‘the biggest problem’ facing state

CUMBERLAND — While it’s an election year, local legislators say they’ll be fighting both for legislation they believe in and attempting to hold at bay legislation they fear could impact District 1 citizens adversely.

The Maryland General Assembly 2104 session opens Wednesday at noon. The session is expected to run until April 7, according to the legislative calendar.

District 1 is represented in the General Assembly by Sen. George Edwards and Delegates Wendell Beitzel, Kevin Kelly and LeRoy Myers Jr.

Legislators have said they will likely need to fight proposals to extend the so-called rain tax to Allegany and Garrett counties. The tax currently applies only to the state’s 10 largest jurisdictions. The fees vary by jurisdiction. The funds are designed to be used to help clean up the Chesapeake Bay. Allegany County officials have also asked legislators to focus on seeking an exemption for counties with little population growth, like Allegany County, from some state laws and regulations linked to the cleanup of the Chesapeake.

“We realize we are essentially preaching to the choir,” said Allegany County Administrator David Eberly at a meeting with delegation members in December. “The real red flag issue we want to talk to you about ... is a one-time fee,” Eberly said. The fee, designed to slow housing growth and, therefore, pollution going into the bay, could be expensive. In some cases, it could add $15,000 to the price of a new home in the county. The cost could be $30,000 for a home on a septic system, Eberly said.

Allegany County commissioners also have asked legislators to make another effort on increasing the monies from highway user funds being returned to local government. Over the years, there has been a sharp decline in those funds, which have been diverted by the state for other purposes, including mass transit in urban areas.

In 2009, Allegany County received just over $4 million in highway user funds from various state revenues for use on county roads and bridges. For fiscal 2013, that number was down to a little over $400,000, county officials said. The Maryland Association of Counties is also backing increases in highway user funds for counties.

Kelly said he’ll continue to fight additional gun control legislation and seek to amend some existing legislation to make it less burdensome on gun owners.

Edwards has said that the state’s structural deficit doesn’t get much attention, but should. “I believe the structural deficit is the biggest problem for the state of Maryland,” Edwards said in December. Much of that deficit occurs via what Edwards called “under budgeting” by the governor. The governor will request an amount of money to fund an agency or project that isn’t sufficient to do so, then at the end of the year, a deficit is left behind.

The structural deficit is created when projected spending has exceeded revenues. This year’s deficit is expected to reach $400 million, Edwards said.

Beitzel said that after thinking the legislature had the deficit under control, it has ballooned again.

One positive expectation, Beitzel said, is that bills reducing the corporate income tax could be coming. Maryland’s current corporate income tax rate is 8.25 percent. While direct comparisons are difficult because of related taxes, that puts Maryland above both Virginia’s (at 6 percent) and West Virginia’s (7 percent) corporate income tax rates. Pennsylvania’s rate though, is nearly 10 percent, according to the Maryland Department of Legislative Services.

At least one local legislator is concerned about Gov. Martin O’Malley’s backing for a minimum wage increase.

“The minimum wage was never meant to be a living wage,” Myers recently said. Raising the wage will hit small businesses hard, especially in areas close to other states where it’s unlikely the minimum wage will be raised above the federal level of $7.25.

About 25,000 Maryland workers earn the minimum wage, according to the U.S. Bureau of Labor Statistics. Another 42,000 in certain industries earn less than the minimum wage.

Bills to raise the wage failed last year but will be back this year, now with the commitment from O’Malley to back the proposals.

Matthew Bieniek can be contacted at mbieniek@times-news.com.

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