Budget bill moves on to the Senate

GOP fails to block plan that raises taxes, fees

March 22, 2003|By Tim Craig | Tim Craig,SUN STAFF

Partisanship splintered the House of Delegates yesterday as Republicans unsuccessfully tried to block a budget plan that includes higher taxes and cuts to many state agencies.

The 94-45 vote sends the budget for the fiscal year beginning July 1 to the Senate, where it is expected to be altered.

Democratic leaders said the $22.6 billion spending plan is a thrifty proposal that will close a shortfall without legalizing slot machines.

"We have a budget that has many things many people will not like," said House Majority Leader Kumar P. Barve, a Montgomery County Democrat. "That is the unfortunate but unavoidable fact in setting a balanced budget."

All but one Republican objected to the plan. GOP lawmakers say the additional taxes and fees will force businesses to cut jobs, plunging the state into a recession.

"This is a very reckless budget," said House Minority leader Kenneth D. Schisler, an Eastern Shore Republican.

Schisler's comments angered Democratic leaders -- who point out that the budget is only slightly different from the one proposed by Republican Gov. Robert L. Ehrlich Jr.

"Republicans can't support their governor. They can't support their governor's revenue increases, and they can't even support budget cuts," Barve said after the vote. "How are they going to balance this budget? Is there supposed to be some kind of budget fairy who waves her wand and magically balances the budget?"

Ehrlich submitted a revised plan last week that further cut state spending and proposed a 50 percent increase in the state property tax. The governor also embraced $85 million in additional corporate filing fees.

House Democrats altered the plan by adding an extra $40 million in filing fees and a tax on HMO policies, raising another $45 million.

The plan -- which includes deep cuts in higher education and eliminates 1,700 vacant state positions -- would leave a small surplus

"We have been fiscally prudent and we have been socially prudent," said Del. Norman H. Conway, vice chairman of the Appropriations Committee.

The plan, however, does little to solve the state's long-term fiscal needs. Legislative analysts estimate a deficit approaching $2 billion within five years unless the General Assembly makes larger cuts or raises taxes.

Ehrlich vowed yesterday not to raise sales or income taxes, despite increased pressure from some legislative leaders. "We were elected to bring fiscal sanity to the state, not to go to the old formula of tax and spend," Ehrlich said.

House Speaker Michael E. Busch said that attitude ignores the state's needs. "It's his responsibility to govern, let them step up to the plate," Busch said, noting GOP lawmakers wouldn't support the cuts and limited taxes in the budget. "I didn't see any from the governor's party offering deeper cuts, and they couldn't support their revenues."

Budget Secretary James C. "Chip" DiPaula said the administration is waiting to see the Senate's version of the budget.

The Senate Budget and Taxation Committee has begun making additional cuts to the budget.

To the dismay of environmental leaders, the committee voted Thursday to save $400,000 a year by eliminating the Maryland Energy Administration. The agency, largely funded by federal grants, administers the state's energy programs.

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