House panel approves $67 million in new fees

Would double cost of land records, motor vehicle titles, vanity plates

March 18, 2011|By Annie Linskey, The Baltimore Sun

A House committee went to work Friday on rewriting portions of Gov. Martin O'Malley's $14 billion budget proposal, rolling back the governor's most significant cuts by chopping elsewhere and raising roughly $67 million in fees.

Lawmakers worked into the night on a plan produced by the Democratic House leadership that would increase the cost of titling cars and trucks, registering land records and getting a vanity license plate.

The extra revenue would go to three groups that have objected most to O'Malley's spending plan: the counties, state workers and school systems. Each group would get a little more in the House version of the budget, though the plan also would put the state on a path to withdraw longstanding support for pension costs in future years.

"I think it is a very conservative budget. It does not raise taxes," House Speaker Michael E. Busch said. "There was a lot of give and take."

Busch, a Democrat, said the proposal would reduce the so-called structural deficit by 40 percent, meaning that it would pare back continuing costs. The speaker acknowledged that some will not distinguish between raising fees and raising taxes.

"Those who will say it will say it," he said.

House Republican Leader Anthony O'Donnell said the new fees only enable the state government to fund superfluous programs.

"These shifts are just increasing spending that the state cannot afford," he said.

The committee voted to double the cost of of a title for a car or truck from $50 to $100. The Motor Vehicle Administration issued 971,000 new titles last year.

The panel also voted to double the fee for a vanity license plate from $25 to $50, which are paid every other year. In 2010, 81,000 Maryland motorists had such tags, according to the MVA.

Those two increases would raise about $50 million in additional revenue for the state. Most of the proceeds would go to the transportation trust fund, a $1.6 billion pot of money used to maintain state highways, local roads and Baltimore department of transportation.

The committee recommended setting aside $13 million as a onetime grant for counties and towns to fix their roads.

"We are giving them a little survival money," said Del. Tawanna Gaines, a Prince George's County Democrat who chairs the transportation subcommittee on the House appropriations panel.

Committee members voted to double fees paid by property owners when they register land records, from $20 to $40. That would raise $17 million for the state, money that would help pay for the House plan to give nearly $60 million back to K-12 education funds cut by O'Malley.

Howard County Executive Ken Ulman, the president of the Maryland Association of Counties, said the House plan would return tens of millions of dollars to the counties. He said he "appreciates" that House leaders "understand the tough times that the counties are going through."

But he is worried about a proposal to shift $17 million of teacher pension costs to the counties. This is the first time that a House committee has agreed to shift that burden to local governments — an idea offered by the House Republican caucus, which opposed the concept in previous years.

David E. Helfman, the executive director of the 71,000-member state teachers union, said his group would fight that change.

"What we are seeing at the county level is cuts in positions," Helfman said. "We know that local systems are going to be paring back staffing levels, kids are going to be hurt."

He said the pension shifts would "take dollars out of the classroom and give it to a state agency. We expect the dollars to flow in the opposite direction."

The committee approved $8 million in cuts to the state's university system, and reductions to the judiciary system and a tax credit created by the General Assembly last year for "sustainable communities."

Members voted to change the state employment retirement system. Under the proposal, most state workers would have to increase their pension contribution from 5 percent to 7 percent. But it would provide a prescription drug plan that is far more generous than the one that O'Malley suggested.

annie.linskey@baltsun.com

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