It was the kind of measure lawmakers dream about voting for: a bill that simultaneously cuts taxes for businesses and increases benefits for the unemployed.
The Maryland House Economic Matters Committee, presented with such a bill yesterday (House Bill 217), voted for it unanimously and sent it to the full House for consideration.
The measure would cut the surtax that every business in the state must pay for unemployment insurance from 1.7 percent of wages to 0.9 percent. The estimated savings to businesses: $112 million.
It also would raise the maximum weekly benefit paid to those who are drawing unemployment insurance from $223 to $265, the first increase in four years.
Members of the House committee said the state's $400 million Unemployment Insurance Trust Fund could afford such largess because unemployment has dropped as the the state's economy has gradually recovered. Maryland's 4.9 percent unemployment rate in November marked a five-year low.
But the proposal has created concern among officials who run the Unemployment Insurance program and with the new chairman of the Senate's Finance Committee, Baltimore County Democrat Thomas L. Bromwell.
Mr. Bromwell said he is worried the House bill goes too far, that it both lowers the tax on businesses and raises the maximum benefits by too much.
"The last thing I want to see, if there is a dip in the economy, is the fund destabilizing or taking a small nosedive and we're right back where we were," he said. "My philosophy is, when things are good is when we should be building the fund; when things are bad, that is when we hit the fund the hardest."
Charles O. Middlebrooks, assistant secretary for employment and training, agreed, saying that while the dual actions may not actually cut into the Trust Fund balance, it will slow the fund's growth. Legislation passed in 1992 established a goal of rebuilding the Trust Fund to $658 million, he said.
Because the bill is intended to be an emergency measure, it would go into effect immediately if passed by three-fifth majorities in both houses and signed into law by the governor.
The changes, however, would remain in effect only one year.
During the summer, legislative committees plan to study the overall unemployment insurance program and recommend changes for the 1996 assembly to consider, including whether the tax on businesses or the maximum benefit levels should be changed again.
"This is a two-for-one bill," said Economic Matters Chairman Michael Busch, an Anne Arundel County Democrat. "It is the ultimate compromise between business and labor."