Panels recommended higher Md. taxes, fees

Groups say funds needed for roads, transit, pollution cleanup

October 25, 2011|By Michael Dresser and Timothy B. Wheeler, The Baltimore Sun

Two groups charged with figuring out how the state can pay for new roads, a cleaner Chesapeake Bay and other key functions of government suggested the same basic answer Tuesday: Marylanders should be asked to dig a little deeper into their pockets.

A blue-ribbon commission on transportation and a committee looking at sewage and growth issues both urged Gov. Martin O'Malley and the General Assembly to come up with more revenue. One recommended a 15-cent-a-gallon increase in the state's gasoline tax, while the other called for tripling Maryland's so-called "flush tax" to $90 by 2015.

The transportation panel also backed a series of higher fees that would affect every Marylander who owns a car or rides the bus or subway. It proposed higher transit fares, a 50 percent increase in vehicle registration fees and doubling the emission inspection fee to $28. Advocates contend revenue increases are necessary to deal with a backlog of deferred projects, including roads, bridges and transit systems.

A committee of a 28-member task force appointed by the governor to tackle sewage and growth issues recommended that the state raise in two stages the $30 annual "flush fee" that all Maryland homeowners pay to help clean up the bay. Under the proposal, the annual fee would rise to $60 next year and $90 in 2015.

The first increase would close a looming $385 million gap in funds to upgrade sewage treatment plants. The second would help local officials pay for cleanup work they're being required to perform over the next several years under the federal government's bay "pollution diet."

Any increases in taxes and fees are certain to face determined opposition in Annapolis, but the governor and General Assembly leaders have said they would give the recommendations serious consideration. O'Malley signaled this month that he might support a gas tax increase. He also has said an increase in the flush fee – formally known as the Bay Restoration Fund – deserves consideration.

"We're going to take a look at everything," O'Malley spokeswoman Raquel Guillory said Tuesday, "particularly as it helps address our infrastructure needs, and to create jobs."

Chairman Gus Bauman said the transportation panel decided to spell out proposals to the legislature in detail rather than make general recommendations.

"It's got to be something specific and real and not just a bowl of mush," he said.

Both the transportation and the sewer panels were set up to make recommendations at a time when state revenues aren't growing fast enough to meet the state's needs. .

Senate President Thomas V. Mike Miller Jr. has said he would push for a transportation revenue package during the 90-day legislative session that begins in January, but has called the suggested 15-cent increase too high.

House Speaker Michael E. Busch was out of town Tuesday and couldn't be reached for comment. He has previously expressed skepticism about a gas tax increase, but spokeswoman Alexandra Hughes said he would take the commission report under consideration.

Any increase in Maryland's 23.5-cent-a-gallon gas tax would be the first since 1992. Transportation advocates contend that the buying power of that revenue has eroded seriously in the intervening two decades, leaving the state an estimated $870 million a year short of what it needs to keep up with necessary spending on highways, mass transit and other projects.

"We've got a serious problem. The federal spigot is running dry," Bauman said.

Anticipating complaints that money raised for transportation would be used for other purposes, the commission urged lawmakers to adopt a strict guarantee that those revenues would not be diverted to balancing the state's budget.

The transportation commission did not take a formal vote on its report but adopted its recommendations by consensus.

Not joining in the general agreement was panel member Lon Anderson, public affairs director for AAA. Anderson complained that the commission's recommendations put too much burden on motorists while failing to identify an alternative source of funding for transit systems.

"The way it's going, the commission has found the state's new ATM … for transportation, and it's motorists," he said.

But Bauman insisted the proposed increases represent a fair balance.

"This proposal does not put a burden on motorists," he said. "All transportation users are going to share this burden."

Carl Davis, resident tax expert at the nonpartisan Institute on Taxation and Economic Policy, said a 15-cent gas tax increase would cost the average Maryland driver $77.55 a year. But he said the hike is justified because almost half of the buying power of the gas tax has been eroded by inflation over the years. A 15-cent increase, he said, would just about restore the gas tax to its 1992 level in real terms.

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