Special Session Update, 11/6
If there is a message in the goings on in Annapolis it would seem to be that Lady Margaret Thatcher was correct in her defining consensus as the absence of leadership.
Consensus, as we are painfully aware, is what Governor O’Malley has been extolling and now it looks like the leadership vacuum that requires consesnsus is in full bloom.
(A second message would be “don’t depend on the the Baltimore Sun to cover the special session,” their “Special Session Blog” hasn’t been updated in 3 days and then only by an O’Malley press release. Great job Brad, Marty, Andy, and the rest of the relentless newshounds at the Sun.)
The roundup is below the fold
The Baltimore Sun reports that the sales tax bill has set off a round of jockeying for exemption that will probably be settled by the guys who contributed the most to the election of Democrats.
Gov. Martin O’Malley, an exercise enthusiast, has proposed taxing health clubs, tanning salons, saunas, massage parlors and property management. He wants to raise the state sales tax from 5 percent to 6 percent. The added revenue would help close a projected $1.7 billion budget shortfall for the fiscal year that will begin in July.
The across-the-board increase would cost residents far more overall, but extending the sales tax to additional services has drawn the most energetic resistance. Some lawmakers say the proposed taxation of health clubs and property management is among the ideas that might not survive the special session called by O’Malley, a Democrat, to address the budget shortfall.
Some in the Democratic-controlled legislature have come up with their own proposals, including taxing such services as extermination services, golf courses, shoe repair, parking and interior decorating. They argue that broadening the services subject to the tax would make the system more fair.
I swear if I hear the word “fair” used again in the context of taking more money to cram into the ravenous maw of Maryland’s government I will upchuck.
The Washington Post reports some of the tax increases are in trouble.
There will probably be no gas tax, but the 20% increase in the sales tax rate may be earmarked, or put in a “lockbox” to coin a phrase, for transportation. All fine and well, but it is more than a little unclear how earmarking a tax increase for new spending erases a $1.whatever-number-O’Malley-is-flinging-about-today billion “structural deficit” but I’m sure Mike2 will make that clear to us proles in due time.
There is no “consensus” on spending cuts. Probably because without a budget to work with cutting spending is difficult. Other than a few vacant patronage jobs the only item really on the table here is limiting Thornton’s unending raid on the state budget. As we noted before, O’Malley’s changes would have the effect of keeping in place increased funding to those counties, both of them and Baltimore City, that went heavily for O’Malley in 2006. Those slammed would be those counties who voted for the much maligned and now much missed Other Guy.
Baltimore City’s delegation has pledged to vote against any bill that trims education spending. Without stopping the growth of that self-licking ice cream cone it is hard to see how any budget will be balanced in the future.
As we reported a few days ago, the increase in the state income tax rate is really up for grabs. It seems like it will increase but the MoCo delegation really has their knickers in a knot over this. Of course, the MoCo delegation is famous for shooting their mouth off when the press is watching and then falling meekly into the party goose step when it comes time to vote.
There is good news. Senator James Brochin, (D-Baltimore County) has said he will join a Republican filibuster against tax increases.
WBAL reports that Senator Lowell Stotzfus asked a hard question of the O’Malley administration, something the Baltimore Sun is unwilling to do.
Senator Lowell Stoltzfus questioned the proposal to put slot machines at Ocean Downs Racetrack in Worcester County, which Stoltzfus represents.
Stoltzfus argues that slot machines at the track near Ocean City will sap business from the resort town. The governor’s top legislative aide — Joe Bryce — says the location was chosen because there is already horse racing there and there would be no other slots parlor nearby.
Stoltzfus asked whether the governor was — quote — “bought” — unquote — by a political donation coming from track owners. Bryce said it was unseemly for Stoltzfus to question the governor’s motives and said O’Malley ran for office saying he wanted to put slot machines at racetracks.
I don’t know if the governor can be bought, but there is a lot of evidence that he can be rented fairly easily.
Now from our correspondent in Annapois we have the inside baseball story.
There is no session today, the time being devoted to cutting deals, trading horses, parceling out favors, and issuing threats. Tomorrow at 1pm the Budget and Taxation Committee meets to begin voting on parts of the O’Malley tax scheme. Key items that will be considered are limiting Thornton (see discussion above) and raiding the Program Open Space coffers.
Our source says that beneath the radar the corporate tax portions of the O’Malley tax scheme are in real trouble. A lot of key Dem contributors are saying no-non-nein-nyet (or “no, nay, never” in tribute to O’Malley’s March) to these increases and legislators are listening.
The sales tax will hit 6%. It will take in a lot of other business services. And the extension of those services will occur, figuratively, in the dead of the night, so the affected businesses will not have time to organize.
Governor O’Malley is reportedly set to claim victory if the the sales tax is raised to 6%, regardless of what happens to the rest of his scheme.