Busch, Democrats gambling on sales tax issue

House lawmakers hope to win support because it would fund education

March 23, 2004|By Michael Dresser | Michael Dresser,SUN STAFF

House Speaker Michael E. Busch is no fan of slot machines, but he's making a calculated gamble that he can make a nuanced case in favor of higher taxes in an age of bumper-sticker politics and 30-second attack ads.

Flanked by more than 40 fellow Democratic delegates, Busch unveiled his program for raising $600 million in net revenue to help close a budget shortfall and funding public education at a news conference yesterday; $70 million more would be raised for transportation.

Republicans are gleefully hoping Busch's decision to press for a 1-cent-per-dollar increase in the sales tax in the face of a certain veto by Gov. Robert L. Ehrlich Jr. will ensure that many of those Democrats and perhaps their speaker will not be back after the 2006 elections.

"It's putting a lot of good Democrats in a very, very bad position," said John M. Kane. chairman of the Maryland Republican Party.

Busch's supporters in the Democratic Party insist their tangible financing plan for the Thornton education funding formula, even if it means asking people to pay more, will trump the Republican anti-tax message. But not everyone in his party is convinced.

"I am concerned that we are leading with our chin," said freshman Democratic Del. Neil F. Quinter of Howard County. "But it is the responsible thing to do, to offer a revenue package to fund Thornton."

Keith Haller, president of the Bethesda-based political polling firm Potomac Inc., called Busch's plan "very strategic."

"Of all the taxes available, the sales tax appears to be the most politically palatable," Haller said. He noted that a poll his company conducted for The Sun early this year found that 65 percent of Marylanders would support a 1-cent sales tax increase tied to Thornton.

The same poll found that voters preferred a sales tax increase to a property tax rise by almost a 5-1 margin: "You've got people all over the Maryland landscape that are upset at the latest property tax increases."

Politically, the Republican message has the advantage of simplicity: Busch wants to raise your taxes.

The speaker has a more complicated case to make. He is telling voters that while he's proposing tax increases, the revenue will go for education. He will have to explain that while sales and auto titling taxes would go up, property taxes would go down. And he's trying to paint Ehrlich as a tax-raiser, too.

The speaker is likely to win praise in some quarters for becoming the first of the state's top leaders to propose a plan to fund Thornton for the school years that begin in 2005 and 2006. As Busch pointed out yesterday, Ehrlich's plan to open the state to large slot machine operations is not certain to generate sufficient money to pay for Thornton in those years.

But Busch's plan faces one of the chief complaints made of Ehrlich's slots proposal: It doesn't raise enough to cover the $1.3-billion-a-year cost of Thornton when it is scheduled to be fully implemented in the 2007-2008 school year.

In reality, Busch's plan faces steep hurdles to becoming law. First, he would likely need a veto-proof majority of 85 votes out of 141 in the House to win consideration in the Senate. Even then, it would face a rough ride and possibly a filibuster in that chamber. And Ehrlich made it crystal clear yesterday that he would veto any sales or income tax increases.

But even if Busch's plan isn't enacted, it could define where he and House Democrats stand - for education even at the cost of raising taxes.

"We think it's the most important thing we can do for the children of Maryland and the citizens of this state," Busch said.

Whether such an act of self-definition is an advantage to his party is debatable. Clearly, Republicans don't think so.

The state GOP quickly put out a news release seizing on an off-the-cuff Busch remark in The Sun that "we're going to have some fun" this week. "Democratic Leader Calls Raising Taxes `Fun'" read the headline.

"If this is what he considers fun, I'd hate to see what he considers exhilarating," said Kane.

If not having fun, Democrats were enjoying a measure of satisfaction in proposing a $320 million cut in the state property tax - or 8 cents per $1,000 of a home's value. That allowed them to shine a spotlight on a tax increase Ehrlich approved.

Kane dismissed the notion that the property tax decrease would make the Busch package, which would raise $665 million from the sales tax increase and $355 from other taxes, any more palatable.

"That is a pimple on the rear of an elephant relative to the total size of the package," he said.

The Democrats also used yesterday's news conference to remind voters of the fee increases Ehrlich has supported.

"Guess what, they're raising taxes also, but their taxes are higher and more unfair, and they're not paying for education," said House Majority Leader Kumar P. Barve of Montgomery County.

Donald F. Norris, professor of public policy at the University of Maryland Baltimore County, said Busch might have a good political message but might have difficulty getting it across:

"The governor's on message all the time. The Democrats in the General Assembly are not necessarily singing from the same page in the hymnal."

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