Subject:
State union calls for more taxes, fewer layoffs
To:
Governor Martin O'Malley
Del. Mary Love
Del. Theodore Sophocleus
Del. Pamela Beidle
Sen. James DeGrange
October 16, 2009
Storytime folks,
There once was a State called Maryland.
Maryland had a balanced budget!
Maryland had a great AAA Bond Rating.
Along came an election and a Pied Piper became Governor, not paying attention to the economy, or to his constituents who warned him, he made a lot of promises to a lot of folks. His budget the first year took off like a Rocket, he was spending money right and left, he WAS the money man. The only problem was that Maryland was on the verge of a recession, loss of revenues, loss of taxes, its people could not afford new taxes to support the Governor's budget. The Nation was in the same bind and could not help out either. Woe to the Governor and the people of Maryland. What to do, how to keep the promises, does the Maryland Government make up the massive spending budget with layoffs and limited funding, or does the Government "Bleed" more taxes from people who are losing their jobs, on limited income, or trying just to stay in their homes? What about the oncoming inflation that will soon be a factor in everyone's life?
What will this Governor do?
State union calls for more taxes, fewer layoffs
By LIAM FARRELL, Staff Writer
Published 10/16/09
A top state union yesterday called on Gov. Martin O'Malley and lawmakers to consider raising revenue rather than continuing to slash spending to solve Maryland's worsening money woes.
Members of the Maryland branch of the American Federation of State, County and Municipal Employees outlined their own proposed solutions during a news conference in Annapolis.
The AFSCME plan includes politically volatile proposals for the General Assembly's election-year session, such as increasing the gas tax, hiking alcohol taxes, drawing down the state's rainy day fund, and expanding the sales tax to more services.
The proposal would also remove the sunset provision on the state's highest income tax bracket and establish "combined reporting" to prevent large corporations in Maryland from shifting profits to out-of-state branches to avoid corporate income tax.
Patrick Moran, the group's executive director, said politicians need "to show that their true priority is to make the tough decisions necessary to keep our state running."
"These cuts are putting at risk our public health, safety, security and our children," he said. "We cannot cut our way out of this."
The extent of Maryland's budget problems was highlighted again later yesterday during a fiscal briefing with the legislature's financial committees.
Although a $2 billion deficit projected for fiscal 2011 is based on some things that likely will not happen, such as cost-of-living increases for state employees, only about $400 million to $500 million of that can easily be siphoned off, said Warren Deschenaux, the chief analyst for legislative services.
"This number can be worked down but it can't be assumed away," he said.
How far AFSCME's proposal will get is questionable, however. Legislators and O'Malley have cast a skeptical eye at any new revenue measures and anything that could affect the state's AAA bond rating, such as dipping into the rainy day fund.
Del. Ted Sophocleus, D-Linthicum, a member of the House Appropriations Committee, said the first priority in the next session is still going to be budget reductions.
Sophocleus said he recognizes the tough position state employees are in, but hurting the state's bond rating would cost the government millions by raising its interest rates.
"You have to take a look at the dominoes," he said. "We got to get serious about accountability and cost-effectiveness."
Despite the growing gap between the State House and organized labor, Moran said his communications with O'Malley's administration remain "healthy." He did not speculate about the effect more budget cuts would have on where AFSCME throws its support in the next election.
"November (2010) is a long time away," Moran said.
Glen Burnie , MD
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