Senate warned not to change House tax plan $250 million boost is all that will pass, Mitchell cautions

March 28, 1992|By John W. Frece | John W. Frece,Annapolis Bureau

ANNAPOLIS -- With a little more than a week to go before adjournment, support in the General Assembly for a tax plan passed by the House of Delegates was shakier than ever yesterday.

House Speaker R. Clayton Mitchell Jr., D-Kent, took the unusual step of warning the Senate that if the House plan is substantially changed, he probably cannot keep together the narrow majority that passed the bill, 78-61, Tuesday night. In the House, 71 votes are required for passage.

Mr. Mitchell also cautioned the senators not to propose raising more than $250 million in new taxes to balance the budget and pay for programs that individual lawmakers want. He and other delegates will not support a larger tax plan, he said.

The situation seemed so uncertain that lawmakers in both houses began speculating on whether the 90-day session might have to be extended beyond its midnight April 6 adjournment -- a rare event that would kill any legislation still pending.

As it stands, the tax plan would raise about a half-billion dollars for the state and give local jurisdictions authority to raise nearly as much themselves. But yesterday, the plan was buffeted as lobbyists attempted to change individual components in ways that could threaten passage of the entire package:

* Some wanted to reduce a 20-cents-a-pack cigarette tax increase,but face the prospect of a gubernatorial veto if they dTC succeed.

* Frito-Lay, the corn-chip maker, warned that it may not be able to open a 300-employee manufacturing plant planned for Aberdeen if a proposed extension of the state's 5 percent sales tax to snack foods stays in the bill.

* A politically connected truck stop owner personally pushed for as much as an 18-month postponement of a higher tax on diesel fuel for trucks, even though regular motorists would be hit with a nickel-a-gallon gas tax increase May 1.

* Environmentalists found themselves defending a proposed "gas guzzler" titling tax that would reward the purchase of

fuel-efficient cars against a "buy American" faction that claimed -- incorrectly, the environmentalists say -- that foreign cars would benefit from such a policy.

* Lobbyists for utilities, county governments, alcoholic beverages companies, newspapers, cable television and just about any segment of society affected by the broad tax package hovered in the wings, waiting for a chance to change the part of the tax bill that affects them.

Senators were divided over whether the plan raised taxes too high, thus jeopardizing their respective re-elections in 1994, or did not raise them high enough to pay for the programs they want to take home to please their constituents.

Sen. Ida G. Ruben and other Montgomery County Democrats demanded changes in state aid programs for education that would give their county as much as $10 million more than it received under the House plan.

Baltimore lawmakers, already worried that their financially troubled city had been shortchanged by the House, debated whether it was worth the risk of losing what the city had won there by trying to obtain more in the Senate. Two major pieces of legislation were at issue yesterday: the state's $12.5 billion budget for the fiscal year that begins July 1, and the tax package that includes increases in the gas tax, a new income tax bracket for wealthy taxpayers, an expansion of the sales tax base and the cigarette tax increase.

A House-Senate conference committee worked last night on the budget, and a separate conference committee was expected to begin work on the tax legislation once some $70 million in budget differences were resolved. But the obstacles were obvious, as budget analysts briefed the Senate's Budget and Taxation Committee on details of the House proposal.

Senate President Thomas V. Mike Miller Jr., D-Prince George's, said he was uncertain if the conference committee could reach agreement, and even if it did whether he would have the votes to pass that agreement.

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