Miller proposes new local gas tax

January 24, 2013|By Michael Dresser and Erin Cox | The Baltimore Sun

Annapolis —

As state leaders look for a way to raise cash for much-needed transportation projects, Senate President Thomas V. Mike Miller on Thursday outlined a plan that involves leasing a Maryland roadway to a corporation and a two-tiered increase in gas taxes.

"It's a tough sell," Miller told reporters. "I'm up to it."

In addition to a 3 percent statewide sales tax on gas, which would be paid by wholesalers and felt indirectly by motorists, Miller's plan would give local elected officials authority to increase the price at the pump by up to 5 cents per gallon. The money raised in the counties and Baltimore could be used for local road projects.

Miller also suggested leasing a roadway such as the Intercounty Connector to an "international giant" that would pay upfront for the right to collect tolls – an approach that has been tried in Chicago and in Indiana. He suggested the state could use the lease money to pay for the proposed Purple Line in Montgomery and Prince George's counties and the proposed Red Line in Baltimore.

Miller has taken the lead on crafting a plan that tackles a backlog of road, infrastructure and transit projects that stretches into the billions of dollars. While Gov. Martin O'Malley, House Speaker Michael E. Busch and Miller have all publicly agreed the needs are so great that they must be addressed, the three Democrats have not reach a consensus on the best way to come up with money.

This year O'Malley has floated a possible penny increase in the state sales tax – to be dedicated to transportation – though he has not made it a formal proposal. Last year, he publicly backed a plan to apply the state's full 6 percent sales tax to sales of gasoline.

Miller's suggested 3 percent sales tax – half of what O'Malley suggested last year – would raise roughly $300 million a year of the roughly $700 million the governor has said the state needs to replenish a Transportation Trust Fund that now can pay for little more than maintenance and operations.

Miller has also floated the idea of setting up regional authorities – with so-far unspecified taxing power – in Maryland's urban area to fund transit systems.  The Senate president said such a system would allay the concerns of rural senators that their tax dollars are disproportionately going toward mass transit. Republican senators say Miller has been talking with them about crafting a bipartisan plan that would raise revenue while meeting theiir concerns. 

Busch has been cool to the idea of higher taxes for people in urban areas, pointing out that residents of urban Montgomery County pay a disproportionate share of taxes but receive a smaller percentage of school construction expenses than many rurtal counties.

Miller said he has met with the governor, who "congratulated him" for moving the discussion and with Busch, whom Miller described as "enthused." An aide to Miller said the Senate president's plan is being drafted and should be introduced next week.

"Any gas tax increase is a hard sell," Miller said. "We're going to work hard, the speaker, the governor and I, to find out what we can make happen and commit ourselves to accomplishing it by getting the votes in the House and the Senate."

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