Reluctantly, Busch backs extra session for legislators

House speaker voices hope for budget solution

General Assembly

April 08, 2004|By Howard Libit | Howard Libit,SUN STAFF

Frustrated by the governor's unwillingness to discuss significant sources of revenues other than gambling, House Speaker Michael E. Busch suggested yesterday that keeping all 188 lawmakers in session beyond the General Assembly's scheduled adjournment Monday might help forge a compromise to Maryland's budget needs.

The speaker's reluctant endorsement of a special session to focus on taxes and legalized slot machines came after another fruitless meeting between Busch and Ehrlich's budget secretary. Senate President Thomas V. Mike Miller has also said in recent days that he's willing to work beyond Monday's scheduled conclusion of the General Assembly if it will push through a gambling bill.

"If there is no movement in the last four days, it might not be a bad idea to focus just on this issue rather than listen to the same rhetoric for 270 days," Busch said. "In many respects, it might be best to have a special session; then the general public knows what's at risk. ... It might need the light of only having one issue out there."

Busch revealed that - should the governor agree to a package of taxes or other revenues in excess of $500 million - he has a virtually completed slot machine bill for consideration by the House Ways and Means Committee and, if the committee approves it, by the full House of Delegates.

The measure would rewrite much of the governor's heavily amended slots plan passed by the Senate in February. That bill permits 15,500 slot machines at three racetracks and three privately owned nontrack locations. The nontrack sites would be kept to just three jurisdictions - Baltimore City and Cecil and Prince George's counties.

The speaker declined to discuss many of the specifics of the plan, but others familiar with parts of it said it will also include six locations, though perhaps with fewer than 15,500 total machines. Discussions are under way as to whether all, or only most, of the gambling facilities would be state-owned.

House Democratic leaders were privately discussing locations yesterday. Places under consideration include the Rocky Gap resort in Allegany County, Frederick County, Prince George's County, Cambridge in Dorchester County, Harford or Cecil counties, Timonium in Baltimore County, Laurel Park in Anne Arundel County, and possibly a new racetrack envisioned for downtown Baltimore.

Some of those locations are in the districts of Republicans who back the governor on slots but oppose slots in their communities. They could be included as "poison pills" in a bill designed to fail in a House vote.

But the speaker and his House leadership insist that unless Ehrlich is willing to back some type of a major revenue package in addition to slots, they won't move on his top legislative priority.

The House has passed a tax package that raises a net of $670 million per year. Ehrlich's slots plan would generate more than $800 million a year, but most of those dollars wouldn't come for at least two years, until the machines are up and running.

The governor rejected yesterday virtually every element of a tax package quietly put together this week by Senate Democrats. The plan included increasing a tax on sales and transfers of cars, and diverting existing money from transportation and land preservation programs.

Virtually the only new revenues backed by the governor are closing a corporate tax loophole and making changes to how federal tax cuts would affect Marylanders' state returns. These would generate far less than the $500 million sought by House Democrats. The governor also indicated support for diverting land preservation dollars to help pay for general state programs. That idea was rejected by Busch as "not new revenues" that would "eliminate all Open Space programs for 20 years."

While both the House and Senate have approved balanced budgets for next year, many Democrats in both chambers argue that additional dollars are needed for the fiscal year beginning July 1, 2005, when revenues are projected to be $830 million short of spending even if slots are adopted.

"Nobody wants to vote for taxes, but it's the responsible thing to do if you want the services," Busch said. He warned that next year's cuts will affect state support for pharmaceutical drugs for the elderly and nursing homes, and will dig into local government aid so deeply that "it's going to bankrupt a couple of the smaller counties."

Ehrlich's budget secretary, James C. "Chip" DiPaula Jr., declined to speak to reporters after seeing Busch.

The speaker's statements yesterday that a special session might be needed to resolve the stalemate over slots and taxes mark a change for Busch, who previously questioned "what magic will happen" if lawmakers meet beyond the 90 days.

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