The Baltimore City Council voted to lift the controversial container tax last night -- effective May 31 -- leaving City Hall to find other revenue to fill a resulting $6.9 million budget gap for the next fiscal year.
One proposed alternative: Reimpose the bottle tax at half the current rate.
That suggestion was part of a $5.5 million revenue-raising package introduced last night by Councilman Anthony J. Ambridge, D-2nd, that would also place a tax at the wholesale distributor level on non-recyclable items such as cars, car batteries and tires, motorcycles, and major kitchen and laundry appliances.
Already, legislation is pending before the council that would place a 16 percent tax on fees charged for the pickup of trash generated bybusinesses in the city. That measure could raise as much as $4.5 million and, combined with proposed tax on non-recyclables, hold out the hope that the council could grant an election year cut in the property tax.
"I think we could lower the tax rate as much as 4 cents," Mr. Ambridge said. "It's not much, but we must give them [property owners] some relief."
The current bottle tax -- 2 cents on bottles 16 ounces or less and 4 cents on larger bottles -- has been unpopular since its passage two years ago in the wake of a similar tax's enactment in Baltimore County. The county repealed its tax in December, increasing the pressure on the City Council to do the same.
Last night's vote to end the tax was 13-6. The issue now goes to Mayor Kurt L. Schmoke, who has said he would not support such a repeal unless the council had devised some way to replace the lost revenue.
"Let the container tax rest in peace. Amen," said Councilman Martin E. "Mike" Curran, D-3rd.
Its rest may be short, however. The tax proposed by Mr. Ambridge last night would reimpose the bottle tax at a lower rate -- a penny on bottles of 16 ounces or less and two cents on larger bottles. That, Mr. Ambridge said, would reduce the bottle tax from about 13 percent per bottle to 6 percent or 7 percent.
But what may make the reduced bottle tax more palatable to bottlers, Mr. Ambridge said, is that other businesses selling non-recyclable goods would be taxed as well.
"The bottle industry has said that they wouldn't oppose a tax if other distributors were included," Mr. Ambridge said. "And under my bill, the tax would be cut in half."
Other taxes would include $1 for every tire and automobile battery sold by distributors, $5 on each car and motorcycle and $2 on each major kitchen or laundry appliance.
The revenue raised by the combined, proposed new taxes would more than make up for the $6.9 million that will be lost by the repeal of the current bottle tax, according to the council members. With that extra money, some council members hope to be able to lower property taxes and others say they would like to beef up the Police Department.
"We need more officers walking the streets and cleaning up the neighborhoods," said Councilman Carl Stokes, D-2nd. "The Police Department has 104 positions vacant, and we should look for ways to fill those."
However, Mr. Stokes and other council members had hoped to stall the repeal of the container tax until the new taxes could be approved.
"This is not the General Assembly," Mr. Ambridge said. "We cannot be so easily cajoled and intimidated by special interest groups. Before we repeal the container tax, we should have a pretty good idea how we are going to replace it."
Councilwoman Vera P. Hall, D-5th, who had asked that the repeal of the container tax be postponed until June 30, said the city would benefit by the additional "cushion of funds" generated by such a postponement.
However, supporters of the repeal were adamant.
"We are not succumbing to lobbyists and special interests," said Councilman Wilbur E. "Bill" Cunningham, D-3rd. "This repeal is fair to our constituents and to our small businesses."
"There's been too much emphasis on this $6.9 million shortfall," said Councilman Joseph J. DiBlasi, D-6th. "There are many ways to meet the projected budget."
For example, Mr. DiBlasi said, the city could defer capital spending and pass the proposed tax on garbage pickup for businesses.
Mr. Cunningham expressed concern about Mr. Ambridge's proposal, which has been sent to the Policy and Planning Committee for study. "Everything is crisis management," he said. "We need to step back and take time to study these issues before we rush to adopt these taxes."