Mitchell wins key support Governor, MACO like balancing act

February 20, 1992|By John W. Frece | John W. Frece,Annapolis Bureau

ANNAPOLIS -- The Schaefer administration and the Maryland Association of Counties formally threw their support yesterday behind the House speaker's budget-balancing plan.

The move could begin to break the General Assembly's deadlock on budget and tax issues.

The plan put together by House Speaker R. Clayton Mitchell Jr., D-Kent, attempts to address a current budget year deficit estimated as high as $270 million. Its two most controversial provisions call for another $88.5 million reduction in state aid to Baltimore and the 23 counties, plus a temporary shift of $80 million from the state's Transportation Trust Fund to the general treasury.

While the plan is not formally linked to pending legislation to raise Maryland's 18.5-cents-a-gallon gasoline tax by a nickel, supporters and opponents alike conceded any plan that would take so much money from transportation purposes would make a gas tax increase almost unavoidable. "I think there is great sentiment on both sides [in the House and the Senate] for the gas tax," Mr. Mitchell said.

Senate leaders said the plan hit local jurisdictions too hard and that the state's cash-poor transportation fund cannot afford to bail out the debt-ridden general treasury. "They're not going to buy Clay's plan over here," predicted Sen. Laurence Levitan, D-Montgomery, chairman of the Budget and Taxation Committee.

Nevertheless, the effect of yesterday's testimony by county officials and Schaefer administration budget officials was to nudge into motion the session's first piece of budget legislation. House leaders said the Appropriations Committee could vote on Mr. Mitchell's fiscal 1992 budget reconciliation plan as early as tomorrow.

Mr. Levitan replied that the Senate also hopes to complete its budget and tax alternative by week's end, a plan that would address both the 1992 and 1993 deficits.

That plan is expected to include a proposed increase of at least half a percentage point in the sales tax, as well as increases in alcohol and tobacco taxes, all effective May 1, he said. It also could include a shift of about $40 million from the transportation fund to the general treasury.

MACO's support for the speaker's budget plan came after Mr. Mitchell personally pleaded for backing in an appearance yesterday morning before MACO's legislative committee. David Bliden, MACO's executive director, and other county officials told the Appropriations Committee that even though they have no appetite for more state-aid cuts, they backed the speaker's plan.

They want to know now how much more spending they must trim from their current year's budgets. The closer they get to June 30, the end of the budget year, the harder it is to achieve cuts, they said.

"We need an answer as early as possible," said Murray D. Levy, a Charles County commissioner and chairman of MACO's legislative committee. He added that Mr. Mitchell promised counties that if they accept the $88.5 million figure, it will be the last cut in state aid to local jurisdictions this fiscal year.

Mr. Levy also called the plan "fair," noting that state aid to local jurisdictions accounts for about a third of the state budget, which is approximately their share of covering the deficit.

But some local officials said privately that despite the outward appearance of support for the House plan, their hope is that they will be hurt even less by a Senate plan.

Sen. John A. Pica Jr., D-Baltimore, said city senators would not support the speaker's plan or any other budget and tax package that does not address their central concern: the creation of a permanent source of state aid to help the city.

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