Council shelves bingo tax rise

Members want to see Leopold's spending plan before increases in any fees

April 08, 2007|By Phillip McGowan | Phillip McGowan,sun reporter

About two weeks after his proposal to tax rental cars crashed at the State House, County Executive John R. Leopold faces a challenge to keep his bid to raise the commercial bingo tax from stalling.

The County Council shelved the bingo bill until Leopold announces his first spending plan in May, suggesting that the county executive's call for "revenue enhancements" has lost steam, some business leaders, lawmakers and observers say.

"Apparently [the council] would like to see the shape of the budget to see if it's worth taking the political hit, depending on where the money could go in the budget," said Dan Nataf, director of the Center for the Study of Local Issues at Anne Arundel Community College.

Council members said they needed more time to weigh the merits of the bill, which was introduced a month ago.

With Councilman Edward R. Reilly, a Crofton Republican whose district includes Wayson's Bingo, absent from Tuesday's council meeting, five members voted to postpone a vote until at least May 7.

Councilman Daryl D. Jones, a Severn Democrat whose district includes another of the county's three bingo halls, made a motion to hold the bill as a "legislative courtesy" to Reilly.

"I've heard from the county executive and I understand we need revenue, but I'd like to hear what some of the alternatives are," said Council Chairman Ronald C. Dillon Jr., a Pasadena Republican. "Right now I'm sitting neutral, waiting to get more information."

Still, the Leopold administration remains confident that the initiative to raise the commercial bingo tax from 7.5 percent to 10 percent - a move that would generate $300,000 to $500,000 annually for the county - will be passed by the Republican-majority council.

The money would do little for a county whose budget exceeds $1 billion, but Leopold has said that the bill would bring into alignment the tax being charged on most other admissions and amusements and add to his arsenal of revenue options. Leopold has said that he will not promote an expansion of gambling.

The county's chief lobbyist, Alan R. Friedman, said the council's consideration of the budget and the bingo bill "can move along parallel tracks." Leopold will announce his budget May 1.

Friedman acknowledged that in tax-averse Anne Arundel, some elected officials don't want to vote for any tax increase.

"We will continue to talk," he said. "Everyone showed their good faith by holding the bill."

Leopold fared worse when he sought state authority to impose a rental car tax, which would generate up to $5 million a year. The county's senators approved a watered-down version of that bill, allowing the creation of a task force to weigh revenue ideas. The Anne Arundel delegates voted down a study to consider the feasibility of a rental-car tax.

Leopold said last week that he will soon introduce county legislation to raise developer impact fees on home construction to pay for extensive improvements of roads, schools and other projects.

The county faces numerous challenges brought on by a flurry of labor contractors, a school maintenance backlog and transit improvements around Fort Meade. County officials said those costs could add $200 million annually to the operating budget.

Having run for county executive last year on a no-new-taxes pledge, Leopold has tried to focus his calls for taxes on visitors and new residents. Like the council, he opposes raising property or income taxes, and he has called on his department heads to cut their budgets by up to 10 percent.

Nataf said Leopold is following the theme of fellow Republican Robert L. Ehrlich Jr., who as governor raised fees, not broad-based taxes, to help balance the state budget.

"There's no way he's going to push along a very big tax increase," Nataf said. "He knows he's got a mission impossible."

Bob Burdon, chief executive of the Annapolis and Anne Arundel County Chamber of Commerce, said he wonders how many times the council will support "piecemeal" tax proposals "before they stop raising their hands." He repeated the business community's call for Leopold to delay any raises in taxes or fees until a county panel completes a comprehensive review of its revenues by next year.

"All of what he is doing is premature," Burdon said of Leopold's proposals.

County officials said the $15 million bingo industry in Anne Arundel can afford to pay more, but bingo establishments worry that higher taxes will make them less competitive with halls in Calvert County, where the tax rate on gross receipts is 0.5 percent.

Michael G. Leahy, an attorney who represents the Maryland Bingo Coalition, said there are ways of boosting revenue from bingo halls without raising their taxes.

According to tax figures he provided, the county garnered $516,000 in taxes from bingo establishments in fiscal year 2002. The number jumped to $877,000 in fiscal 2006. Some of that boost has been attributed to a 2005 county law that expanded the variety of bingo games and increased the jackpot size.

phill.mcgowan@baltsun.com

Sun reporter Dan Lamothe contributed to this article.

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