Will it mean death to drink it?
Conventional wisdom is that voting for a tax increase in an election year means defeat for a politician. With many Marylanders still smarting over the tax increases the General Assembly voted in the special session a few years ago, that would seem to be the case in Maryland this year. But that hasn’t discouraged members of the General Assembly from proposing a variety of new or increased taxes or fees this year. Let’s take a look.
First up is SB 686 – The Watershed Protection and Restoration Act sponsored by Senators Raskin, Frosh, Harrington, Lenett, Madaleno, Pinsky, Pugh and Rosapepe. The bill would basically require local jurisdictions to establish a stormwater remediation fee and local watershed protection and restoration funds. In 2007, the General Assembly passed legislation to address stormwater runoff from new developments and the Maryland Department of Environment has recently issued regulations implementing that law (which are currently the subject of intense negotiation with developers.) But the act did not address runoff from existing developments.
Back in 1992, localities were authorized to impose fees on property owners and earmark the revenue for stormwater control, but only six have done so – Charles, Montgomery and Prince George’s counties along with Annapolis, Rockville and, of course, Takoma Park. This bill would require every jurisdiction to impose fees. The bill does not specify the amount of the fees. A similar bill failed in the Senate last year and was not considered in the House.
HB 479 and HB 969 would both increase the Motor Fuel Tax rate in Maryland. HB 479 would increase the tax by ten cents a gallon phased in over five years. HB 969 would increase the tax by 1/2 cent a gallon and index the fuel tax to the Construction Cost Index. The current fuel tax in Maryland is 5.5 cents per gallon – considerably lower than the national average of 29 cents per gallon. Both of these bills attempt to address the chronic shortfall in the state’s transportation fund. While the cost of construction has skyrocketed in the past several years, the tax per gallon has remained the same. Indeed, increases in fuel economy have reduced the total tax receipts.
SB 717 and HB 832 would increase the alcohol tax in Maryland from $1.50 to $10.03 per gallon of distilled spirits, from 40 cents to $2.96 per gallon of wine and from 9 cents to $1.16 per gallon of beer. The House bill has 41 sponsors and the Senate bill has 8. The tax on distilled spirits has not changed since 1955 and the tax on beer and wine since 1972. The bill would devote all funds from the increase to helping people with various disabilities and supporting Medicaid coverage for poor adults. Several polls indicate that the majority of Marylanders support these increases. It remains to be seen, however, whether the General Assembly will support the bill. The liquor lobby is strongly opposed and they are a major source of political contributions.
SB 462 sponsored by Senators Raskin, Conway, Forehand, Frosh, Harrington, Lennet, Madaleno, Muse, Peters and Pinsky would require stores to collect a five cent fee for every disposable carryout bag provided to customers. Four cents of the fee would go to the Chesapeake and Atlantic Coastal Bay Trust Fund while one cent could be retained by the store. If the store has a customer bag program, the store could retain two out of the five cents. The bill also provides that bags must be recyclable. The District of Columbia already has such a program. Americans use about 80 billion plastic bags a year and the bags have a significant environmental impact. A hearing is scheduled on the bill today.
Which of these bills has a chance of passage? Conventional wisdom would say none during an election year. We have to remember, though, that a substantial proportion of the State Senate and House of Delegates faces no significant opposition to re-election. I did a quick count and found 29 or the 47 senators won their last election with more than 60% of the vote. A similar proportion of delegates had such margins. It may well be that their support will push one or more of these bills across the finish line. In any case, we can be sure that every one of these will reappear next year if they fail this year.