Religious leaders protest tax plan

City has proposed expanding 8 percent energy levy to nonprofits

May 08, 2001|By Neal Thompson | Neal Thompson,SUN STAFF

Beneath signs reading "Say no to church taxes," Baltimore religious leaders and congregants rallied outside City Hall yesterday to protest city plans for an energy tax on churches and other nonprofit organizations.

"We consider a vote for this measure as a vote against us," said the Rev. Gregory B. Perkins, president of the Interdenominational Ministerial Alliance, a group of predominantly African-American clergy. Perkins organized the rally.

About two dozen church leaders and an equal number of church members gathered around Perkins as he spoke with reporters for about 15 minutes.

Afterward, the group crowded into the chambers of the City Council, where Perkins confronted Council President Sheila Dixon and warned her that a vote in favor of the energy tax would be held against her at election time.

Dixon, who supports taxing nonprofits, told the church leaders they could not address the council, but she agreed to read aloud during the meeting a statement they had prepared.

The energy tax proposal, introduced before te City Council last week, would expand the city's existing 8 percent tax on energy consumption -- which now affects only commercial businesses -- to include nonprofits, such as churches, schools and hospitals. It would raise a projected $4.6 million next year.

Mayor Martin O'Malley has said the tax and a 20 percent increase in the city income tax, are needed to help close a projected $21.3 million budget shortfall. The council is scheduled to vote on the tax plan in the next few weeks.

The Rev. William A. Au, pastor of SS Philip and James Roman Catholic Church in Charles Village, said the tax would be especially hard on churches because, unlike nonprofit schools and hospitals, churches can't charge their customers more. He said the Johns Hopkins University and its hospitals, for example, could raise fees to pay for the new tax.

"But where do the congregations go?" Au said.

Some religious leaders said the tax would hurt churches that provide social services the government can't afford. And it would come as energy costs have risen. Perkins, pastor at St. Paul Community Baptist Church in East Baltimore, said his monthly bill from Baltimore Gas and Electric recently tripled to $3,300.

"Many of us have pressure on us to leave the city, but we have chosen to stay in the city to help the poorest of the poor," said the Rev. Johnny Golden, pastor of the New Unity Baptist Church. "Don't hurt the helpers. We are the helpers."

Other religious leaders -- fearful that the energy tax represents a first step toward chipping away their institutions' tax-exempt status -- have written letters to O'Malley or met with him.

O'Malley said yesterday that Perkins' group does not represent all of the city's churches nor does it speak for all nonprofit organizations. He said he was surprised to see them rallying against a "slight" tax increase "instead of rallying against the homicide rate in the city."

O'Malley also said it was unlikely that last week's news of a $9.3 million windfall headed for Baltimore's coffers -- due to a processing glitch by the state comptroller's office -- would alter his plans for an energy tax. City officials said Friday that the $9.3 million would likely be used to pay for capital projects or set aside in a rainy day fund but would not eliminate the need for tax increases or layoffs.

Michael D. Golden, spokesman for Comptroller William Donald Schaefer, said yesterday that it was unclear whether Baltimore would receive the money in a lump sum or spread over time. Golden said an internal audit was being conducted to determine exactly how much money was involved.

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