Plans to shore up college system hinge on new taxes Bills would boost college aid, raise gas, utility levies.

November 13, 1991|By William Thompson | William Thompson,Evening Sun Staff Monica Norton contributed to this story.

Maryland's public colleges and universities would receive substantial increases in sorely needed aid under a pair of relief plans. One of the plans calls for an increase in utility taxes and the other could result in an increase in the gasoline tax.

The two plans -- which would earmark new funds for four-year schools and community colleges -- yesterday quickly received the endorsement of the Maryland Higher Education Commission.

But a skeptical Gov. William Donald Schaefer said today the state's budget problems cannot be solved by focusing on particulars.

"We just can't start taxing this and taxing that, shifting money here, shifting money there without looking at the whole picture," he said.

Schaefer also said he sees no widespread support among Maryland residents or their lawmakers for raising taxes.

"I just don't see any sentiment for new taxes," he said. "There's just none."

Bemoaning massive reductions to school budgets that came as part of recent belt-tightening decisions made by lawmakers, Higher Education Secretary Shaila R. Aery said further cuts will jeopardize efforts by the state to reach national prominence in its public university system.

"Higher education cannot take these cuts and be anything near quality," she said.

Cuts imposed by the Schaefer administration sapped $145 million over the past 12 months from higher education budgets. With the state facing a possible $1 billion more in revenue shortfalls over the next 18 months, Aery said higher education could be forced to shoulder up to 15 percent of the deficit in further cuts.

Without new sources of money, she said, four-year colleges may have to increase tuition next year, a prospect she said she wants to avoid.

"As we look at this next year and another tuition increase . . . we would have tuition so high we would have priced out many students," Aery said.

Solutions to some of the money problems could come from two bills being prepared by lawmakers.

A bill Aery said will be sponsored by Del. Henry B. Heller, D-Montgomery, would raise about $38 million a year for community colleges by increasing to 3 percent from 2 percent a state gross receipts tax on gas and electric companies.

Because lawmakers traditionally are opposed to earmarking taxes for funding specific programs, Aery said she would support redirecting revenues from the bill to the general fund after three years.

Another plan that could lead to increased taxes for higher education was announced yesterday by four Prince George's County legislators, who proposed to restore more than $38 million in cuts to the 11 campuses of the University of Maryland system as well as Morgan State University and St. Mary's College.

Sen. Arthur Dorman and Dels. James C. Rosapepe, Timothy F. Maloney and Pauline H. Menes, all Democrats from the College Park area, unveiled their proposal at a news conference at the University of Maryland's College Park campus and later in Annapolis.

The bill would reverse the cuts in higher education for fiscal year 1992, which ends next June 30, and fiscal year 1993. It would take $38,121,000 in corporate income tax revenues this year from the Transportation Trust Fund and move it to the General Fund for public higher education, including all 11 campuses of the University of Maryland System, Morgan State University and St. Mary's College. The $80 million going into the trust fund next year would be used for fiscal 1993.

But some lawmakers believe the plan will encounter obstacles because it hinges on raising new transportation revenues -- probably in the form of a higher gasoline tax -- to replenish money shifted from the Transportation Trust Fund, a special budget set aside for highway construction projects.

Yesterday, Dorman acknowledged that a gas-tax increase might be necessary for the plan to be successful. Yet House Majority Leader Del. D. Bruce Poole, D-W.Md., said there is strong opposition to a gas tax increase.

"I would rate a gas tax as probably the least likely," he said. "There is still a presumption against any tax increase in the House."

David S. Iannucci, Schaefer's chief legislative aide, said the governor is willing to consider ways to protect the higher education system from further budget cuts.

For the first time, Schaefer has agreed to let legislators participate in pre-session talks to assemble a budget package. General Assembly leaders are expected to sit down with Schaefer's fiscal experts this week for what should be at least a month-long series of budget sessions.

Although Schaefer has said he will not take the lead this year in calling for new taxes, Iannucci said legislative proposals to raise revenues will be examined.

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