Bottled-up dispute erupts at container tax debate

November 06, 1990|By Martin C. Evans

A dispute over whether to end the container tax in Baltimore, which simmered for more than a week in private conversations throughout City Hall, boiled into public view during last night's meeting of the City Council.

Council members, some of whom engaged in a testy exchange on the council floor, were divided over whether to support either of two plans that would repeal the tax.

One of the two plans, which were introduced as bills before the council yesterday, would end the tax by the end of next month. The other bill would repeal the tax on June 30, which is the end of the city's fiscal year.

The tax, which adds 4 cents to the cost of a 16-ounce can of soda or beer and 2 cents to smaller beverage containers, has been criticized by beverage distributors and store owners who say it will be a particularly unfair burden now that a similar tax is scheduled to end in Baltimore County Dec. 31.

But neither of the repeal bills has the support of Mayor Kurt L. Schmoke, whose administration has come to depend on the tax as a way of generating badly needed revenue for the financially strapped city.

The container levy, part of a package of so-called nuisance taxes passed last year as a way of balancing the city's budget, is being counted on by the Schmoke administration to generate roughly $6 million during the current fiscal year, according to Douglas E. Brown, the city's deputy budget director.

Mr. Brown said the tax generated $3,477,000 for the city treasury between Jan. 1 and June 30, which was the last half of the 1990 fiscal year. Ending the tax in December would produce an unexpected shortfall in the budget and probablyforce the city to cut expenses, he said.

"If you undo your revenue sources, that means you have to undo expenditures," Mr. Brown said. "I'm not sure they've addressed that."

Councilman Joseph T. "Jody" Landers, D-3rd, who fought in favor of the tax in 1989, yesterday introduced the bill that would kill the tax by Dec. 31.

Mr. Landers, who is said to have the support of at least five of his colleagues, said to allow the tax to remain in force after the county tax expires would encourage consumers to drive to Baltimore County to do their shopping, placing store owners in the city at a disadvantage.

Mr. Landers said he and others voted in favor of the city tax in 1989 on the belief that Baltimore County lawmakers eager to find alternatives to property tax revenues would be reluctant to repeal their container tax bill.

"For me, it's a question of who will pay for our error of judgment and miscalculation," Mr. Landers said.

But 11 other council members backed the other bill -- one introduced by Councilman John A. Schaefer, D-1st -- which would allow the city to continue collecting the container tax until June 30.

Mr. Schaefer, who is chairman of the Budget and Appropriations Committee, said that while he and others eventually would like to see the tax repealed, it would be too much to ask the city to give up a key source of revenues on such short notice.

"To do anything prior to that time [June 30], as much as everyone in this council would like to, would be fiscally irresponsible," Councilman Schaefer said.

He even went out of his way to chide a council freshman who is also from the 1st District, Nicholas C. D'Adamo, for supporting an early repeal of the tax.

"What my colleague from the district doesn't realize, and I know he is a freshman, is this could have ramifications in our district and other districts," Mr. Schaefer said.

The fight over repeal of the city container tax apparently came despite the best efforts of some council leaders, who apparently wanted to forestall the issue of tax repeal until after today's elections in Baltimore County.

Members of the Baltimore City Council had hoped to work with county officials to come up with an alternative package of taxes on a broad range of items that end up in the municipal waste stream. City and county officials then could use those taxes to make up for revenues lost with the repeal of the container tax.

But several Baltimore County elected officials, who face constituent concerns over high taxes, apparently wanted to defer any talk of alternative taxes until after today's election, according to a key member of the Baltimore council, who asked not to be quoted.

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