April 01, 2003

IDEALLY, GOV. Robert L. Ehrlich Jr. and the General Assembly would have agreed on a substantial tax increase this year.

Instead, the governor's no-new-taxes campaign promise and the legislators' own aversion to the same subject may push the Assembly to the brink of an extended session.

Overtime legislating ought to be avoided: It would merely fray tempers, offer another picture of governmental failure and, possibly, result in real mischief.

A far better solution is at hand.

The governor, the House of Delegates and the state Senate are not that far apart on the one matter that could keep them in Annapolis - the budget. With whatever fine-tuning is needed, the Senate should accept the House-passed budget and the governor should sign it.

It's a compromise all parties should be able to accept. The House bill does not legalize slots at the racetracks as Mr. Ehrlich desires, but it puts off the major tax increases he opposes.

The governor had hoped slots revenue would safeguard his promise to avoid new taxes. But his bill to legalize the machines at four Maryland tracks ran into considerable questions revealing many deficiencies.

The House of Delegates has shown there is another way, balancing this year's $22.6 billion budget without a quarter from slots. It uses revenue from a state property tax increase and increases in corporate filing fees. The House plan is a stopgap designed to buy time - time for a study of the state's financial structure and time to consider the wisdom of going into business with the gambling industry via slots.

The first 83 days of this year's session in Annapolis proved that none of the slots proposals offered was ready for prime time. If slots are to come - and they should not come, ever - they need far more study.

House Appropriations Committee Chairman Howard P. Rawlings of Baltimore appropriately laments the failure of the Assembly - so far - to provide a major new source of revenue. Billion-dollar budget deficits projected every year for the next four years won't suddenly disappear.

This imbalance between spending and income could have been addressed responsibly in a variety of ways: by imposing a surtax on higher-income Marylanders, closing corporate tax loopholes, adding a penny to the sales tax and making various services subject to the sales levy.

But Mr. Ehrlich wanted to honor his campaign promise, fearing the political repercussions if he were to allow any increase in the sales or income taxes. He might well have modified his position: He inherited the deficit he must now address from a Democratic administration and a Democrat-controlled Assembly. Tax receipts fell after he moved into the governor's mansion.

But it's his problem to solve. If higher taxes are inevitable - and they probably are - delay could make the tax medicine harder to swallow. Governor and legislator alike should remember this: They were elected to govern in the best interests of Maryland, not to protect their political futures.

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