Increase taxes, officials asked Many speakers at hearing represent state programs.

December 03, 1991|By William Thompson | William Thompson,Evening Sun Staff Laura Lippman contributed to this story.

Speakers testifying in Annapolis last night at a public hearing on state spending said that a Maryland without new taxes would be much like the weather outside the hearing room -- dark and dreary.

"Educate the children now or incarcerate them later," pleaded James A. Shearer, a Forestville resident who said further cuts in aid to public education will have negative effects on children later in life.

Mental health services that took decades to set up are being dismantled because of budget cuts, warned Beatrice Rodgers, president of the Mental Health Association of Maryland.

Money problems mean that many of the state's 134,000 children and adolescents with mental health needs will receive substandard care, Rodgers continued.

"I'm not painting a pretty picture for you," she said. "Nor am I exaggerating."

One after another, mostly dismal predictions were laid before a special legislative panel at the hearing, the first of five meetings scheduled across the state by lawmakers who spent the summer studying the state's system of taxing and spending.

After rejecting a Schaefer administration plan last session to raise $800 million in new taxes, legislators vowed to look into the state's tax structure and come up with their own plan to solve Maryland's money woes, either by raising new revenues, reducing government or a combination of both.

Last night's kickoff hearing drew testimony from more than 50 individuals, mostly representing state programs that had suffered under five rounds of cuts this year in order to keep the general fund in balance.

And further feeding their fears about money problems is a looming sixth round of cuts -- totaling as much as $200 million -- that could come this month.

Yesterday, Gov. William Donald Schaefer said the state's Medicaid rolls increased by more than 6,000 in October, adding to the growing deficit in the program that provides health care for the poor.

"It's taking a terrible toll," the governor said. The growth in the number of people eligible for Medicaid will add about $45 million more to the deficit in this year's budget.

Schaefer said he does not expect the special joint House of Delegates and Senate budget panel to learn anything new as it travels around the state soliciting taxpayer comment on government spending.

"They're going to find what they already know," he said, adding ** that he also does not anticipate a great outcry in favor of raising taxes.

"That sentiment of no new taxes is still very heavy," Schaefer said.

If the governor is right about the conclusions the legislative "road show" may draw in general, at least last night may have been an exception.

Except for a handful of speakers representing taxpayers' groups, most of the speakers endorsed raising new revenues through higher tax rates and closing tax loopholes.

Service organizations asking for higher taxes to support education and health programs were joined by state employee union officials and highway contractors.

"We need significant amounts of revenue and we need it quickly," said Bill Hudson, president of the state chapter of the American Federation of State, County and Municipal Employees, who noted that state workers received no cost-of-living pay increases this year.

Without a 10-cent-a-gallon increase on the state gasoline tax, Maryland motorists could face terribly congested highways in the future, said Pierce Flanigan, a builder and spokesman for Marylanders for Efficient and Safe Highways.

Amid the calls for new taxes to support state programs came one suggestion for cutting the budget -- eliminating the legislature's personal $6.4 million scholarship fund.

Phil Andrews, executive director of the Maryland chapter of the citizen group Common Cause, said a study of how scholarships are distributed, though incomplete, revealed that many grants are given to students from families showing no need for financial assistance.

Andrews said Maryland remains the only state which allows its lawmakers to hand out scholarships. The money could be cut from the budget entirely or redistributed to other programs, he suggested.

"We ask not that you reform the program, but that you get rid of it," he said.

Advocates for Children and Youth Inc., in coalition with an array of advocacy groups, released its proposed budget for fiscal year 1993 in Baltimore yesterday.

The budget included proposals to close some tax loopholes and increase the corporate tax and "sin" taxes on cigarettes, as well as broaden the sales tax. Speakers at the news conference encouraged citizens to testify at the public hearings.

"Some people may say, 'This is a little crazy, the state is in an economic crisis,' " said Susan P. Leviton, president of Advocates for Children and Youth. "You have to look at a crisis and look at the opportunities it provides."

Leviton's group, along with organizations including the Maryland Alliance for the Poor and the Maryland Food Committee, wants to put more money into preventive services, such as prenatal care and immunizations, in return for long-term savings.

Volunteers working with the groups will distribute thousands of paper badges, to be fastened to lapels with diaper pins and bearing the legend: "Stick up for kids! Give them a voice. YOURS."

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