Loophole

I read with interest the article about the Do Not Call Registry ("Government cracks down on robocalls," Feb. 16). It suggested that the Federal Communications Commission is clamping down and closing many of the loopholes in the telemarketing rules. Unfortunately, the FCC will not close one of the most egregious loopholes - namely the one allowing "political" robocalls. When the original law was passed creating the Do Not Call list, the politicians, in their typical arrogant way, exempted themselves from the ban. At election time, we are all bombarded with these intrusive calls as a result.

Congress may soon finalize the 2012 Farm Bill, and that hefty document should concern all of us in Maryland - especially when it comes to clean water. As we all know, the Chesapeake Bay is the nation's largest and most productive estuary. However, the bay is threatened by pollution from its major tributaries, including fertilizer-laden waters from farmlands. Each summer, nutrient runoff leads to algal growth, resulting in oxygen depletion as the algae decays. The loss of dissolved oxygen causes more than a third of the Chesapeake Bay to become a "dead zone.

- In a victory for people with cancer and other serious medical problems, the White House agreed Friday to help close a loophole in the Senate health care bill allowing annual dollar limits on their care. "The president has made it clear that health insurance reform legislation should prevent insurance companies from placing annual limits on health expenditures that can force families into financial ruin," said White House spokesman Reid Cherlin. The move was applauded by the American Cancer Society Cancer Action Network, which first called attention to the problem.

This afternoon, Gov.Martin O'Malleyplans to sign what may be the most significant step toward increasing transparency in Maryland's system of campaign finance in years: a requirement that those who contribute more than $500 to a single candidate during an election cycle list their occupation and employer. That's a good thing; it will give the public a much better idea of who is backing candidates for office and why. However, the fact that this step only brings Maryland up to some semblance of the standard the federal government has employed since the 1970s, and a majority of other states have long held as well, shows just how far the state has to go if voters are to have confidence that the entire campaign finance system isn't just a means for special interests to buy influence.

LAWMAKERS SHOULD be outraged -- but, predictably, they don't seem to be. Reports show Edward A. St. John of MIE Properties has poured $160,000 into the state's 2006 election. To accomplish this feat, he had to bypass the state's law restricting donations to $4,000 for individuals and $10,000 per company. How did he do it? By funneling the money through more than 50 companies he runs out of his Baltimore County office. And why would Mr. St. John have so many subsidiaries? Because property-holding firms such as MIE typically sort their holdings into LLCs and LLPs -- limited liability corporations and limited liability partnerships.

LIMITED LIABILITY companies are smart business. LLCs and the similar LLPs (limited liability partnerships) were created as a hybrid between corporations and partnerships in the early 1990s to help shield small-business owners from personal liability. But a funny thing happened. Investors started taking advantage of a tax loophole. And now that loophole needs to be filled. Here's the problem. Sometimes, LLCs are used purely as a way to invest in a piece of commercial real estate. That's fine.

The average taxpayer should be fuming over the recent legislative audit of the Maryland Department of Assessments and Taxation. Not because of the various oversights or recordkeeping problems the auditors uncovered. Those are correctable. Not so the legal loophole that has allowed owners of multimillion-dollar commercial properties to dodge taxes that the rest of us routinely pay. And the problem is getting worse. Here's how it works. Back in the 1990s, lawmakers decided to allow commercial property to be held in limited liability partnerships or corporations as a way to protect individual investors from personal liability in the event of civil actions.

Republicans in the General Assembly said yesterday they want to close a loophole that Senate Democrats hope to exploit to steer unlimited amounts of campaign money to candidates they support.The 31 incumbent Democrats, led by Senate President Thomas V. Mike Miller, have created the Maryland Democratic Senatorial Committee -- a so-called "slate" -- in an attempt to raise and shift hundreds of thousands of dollars to candidates who might need it, particularly nine incumbents targeted by the GOP.Under Maryland election law, a candidate is limited to transferring $6,000 through his or her campaign committee to any other committee.

GOV. ROBERT L. Ehrlich Jr. announces periodically that he's been up in Delaware visiting his money. We get the joke: Delaware has slots. Marylanders cross the state line with gambling dollars that could be collected in their home state. Wouldn't it be better, he's saying, if that money stayed in Maryland? Maybe, but no one has figured out how to make that happen. And there's even more Maryland scratch across the border -- at least $55 million goes there every year as various businesses transfer their profits to shell corporations legally situated in Delaware.

ANNAPOLIS -- The House of Delegates passed a bill yesterday that closes a corporate tax loophole and dedicates most of the money to school construction. A leadership priority, the bill would require corporations to pay transfer taxes and recording fees when they sell real estate. The bulk of the money raised, about $45 million a year, would go back to the counties for school construction. An amendment approved this week dedicates the state portion of the money, about $12 million annually, for land preservation.

No sooner had Anne Arundel County Executive John Leopold unveiled his proposed budget for next year than Superintendent Kevin Maxwell was complaining that the schools were being shortchanged by $12 million. It was the latest salvo in a long-running feud between the two men over what it really means for the county to maintain its state requirements for school funding. It's not entirely clear which one is right about the law. But what is clear is that the General Assembly was right to approve legislation this year adding specificity and teeth to its maintenance of effort law. The argument between Messrs.

Annie Linskey 's recent article regarding Maryland tax revenue estimates ("State reduces estimates of 2 years' tax receipts," March 8) failed to identify a major problem draining our state of revenue - corporate tax loopholes. When large corporations abuse loopholes and skirt paying the taxes they otherwise would owe, small and mid-sized businesses are forced to shoulder the burden of higher taxes or deal with a decline in the public infrastructure and services that help businesses thrive.

Maryland's General Assembly faces another year of "difficult choices" as it takes up the governor's budget. So it's surprising to me that lawmakers don't turn more readily to what should be an easy choice: closing loopholes in the corporate income tax (CIT). Federal and state governments have faced declining corporate tax revenue for years, mainly thanks to increasingly aggressive use of legal tax avoidance techniques. At the state level, this generally means shifting income from higher- to lower-taxed jurisdictions.

I read with interest the article about the Do Not Call Registry ("Government cracks down on robocalls," Feb. 16). It suggested that the Federal Communications Commission is clamping down and closing many of the loopholes in the telemarketing rules. Unfortunately, the FCC will not close one of the most egregious loopholes - namely the one allowing "political" robocalls. When the original law was passed creating the Do Not Call list, the politicians, in their typical arrogant way, exempted themselves from the ban. At election time, we are all bombarded with these intrusive calls as a result.

Once again, lawmakers have created a self-serving loophole regarding Do Not Call lists ("Government cracks down on robocalls," Feb. 16): Charities and political organizations are exempt. Charities are organizations whose mission is to serve the needs of others, whereas political organizations tend to be self-serving. I personally cannot recall ever receiving a robocall from a charitable organization. Laws to restrict junk mailings also provide exemptions to political organizations.

Gov. Martin O'Malley appealed to lawmakers Tuesday to adopt his "moderate" and "reasonable" proposal to curb development on septic systems, warning that unless sprawl is reined in the state's "Christmas future" would include loss of farmland and forests and a lifeless Chesapeake Bay. As expected, his bill, SB236 , has drawn flak from developers and some rural politicians who charge it would stifle growth and cripple local economies.  But...

Disclosure of possible conflicts of interest is crucial to maintaining public trust in government and in ensuring that elected officials maintain the highest standards of conduct. But Baltimore has managed to render something so important a near total waste of time. Sun reporters Luke Broadwater and Julie Scharper found plenty of questionable actions by elected officials when they investigated how often Baltimore politicians avail themselves of free tickets to cultural and sporting events.

What's most troubling about the Baltimore Police Department's new rules regarding the public videotaping of police is that any new rules were required in the first place. The notion that some cadre of uniformed officers - perhaps even a majority - mistakenly believed until recently they have every right to confiscate the cell phone and delete the recordings of someone who did nothing more than tape an arrest in a public place is chilling to say the least. Not that one expects a city police officer to be a Constitutional scholar, but this isn't a Harvard Law School moment.