A financial tug-of-war is unfolding in the Maryland General Assembly. On Friday, leaders from the House revealed a bold $1.3 billion strategy aimed at generating new state funds. These funds are earmarked for future education and transportation expenses. However, Senate leaders are expressing concerns, labeling the plan as overly ambitious given the current economic situation of the state.
The House’s financial strategy is comprehensive, encompassing increases in taxes, fees, and tolls. Additionally, it proposes the introduction of online gambling. This move would allow for casino games to be accessed and bet on via the internet.
At a press conference, House Speaker Adrienne Jones, representing Baltimore County and a member of the Democratic Party, took the stage alongside fellow Democrats. She emphasized the need for long-term solutions over temporary fixes. “We can no longer rely on quick fixes or short-term approaches,” Jones stated, highlighting the necessity for sustainable revenue sources.
The focus of the plan is on addressing the escalating costs associated with the state’s K-12 education funding scheme, known as the Blueprint for Maryland’s Future. This initiative, approved in 2020, is set to gradually increase funding to enhance early childhood education, raise teachers’ salaries, and support underperforming schools.
While the Senate has approved a budget that fully funds the blueprint for the upcoming fiscal year, the challenge of managing rising costs in subsequent years remains unresolved.
The House’s solution involves funding from internet gambling. However, expanding gambling would require amending the state constitution, a process that demands a three-fifths majority vote in both legislative chambers and the approval of voters in November. The plan also includes corporate tax reform to support the funding of the blueprint.
House Speaker Adrienne Jones, a Democrat from Baltimore County, announced a plan to raise over $1 billion in revenue for K-12 education and transportation. This announcement was made during a news conference with other House Democrats on March 15, 2024, in Annapolis, Md.
To tackle the state’s transportation funding issues, the House proposes increasing the vehicle excise tax from 6% to 6.5%. It also suggests modifying a vehicle trade-in exemption to only apply to zero-emissions or hybrid vehicles. Additionally, the plan calls for adjusting vehicle registration fees based on new weight classifications and implementing a statewide ride-sharing fee of 75 cents. An increase in toll revenue is also part of the proposal.
Del. Marc Korman, a Democrat from Montgomery County and chair of the House Environment and Transportation Committee, noted that tolls have not been raised for a decade and were reduced for political reasons by the previous administration.
So far, the Senate and the governor have not shown support for the House’s proposal. The governor’s $63 billion spending plan, which was approved by the Senate, aims to balance the budget while maintaining a substantial rainy day fund.
Senate President Bill Ferguson, a Democrat from Baltimore, expressed his concern for Marylanders facing the challenges of persistent inflation. He emphasized the importance of not imposing additional burdens on them.
Gov. Wes Moore, also a Democrat, has been cautious about endorsing tax increases. His budget plan, submitted in January, did not include tax hikes. Carter Elliott, the governor’s spokesperson, stated that any discussions with the General Assembly regarding taxes would need to focus on fostering fiscal discipline and economic growth.
Del. Ben Barnes, chair of the House Appropriations Committee, argued that the state’s current budget is not sustainable enough to address the identified priorities. “We are facing a high bar. We are facing shortfalls in our Transportation Trust Fund that are not sustainable, so we believe we’ve met the high bar,” said Barnes, a Democrat from Prince George’s County.
Negotiations between the House and Senate must be concluded before the General Assembly adjourns on April 8 at midnight.
Both legislative chambers are nearing an agreement on new revenue sources to support the rising costs of the state’s medical trauma system. They are advancing measures to increase revenues from vehicle registration fees to support emergency services. Additionally, both the House and Senate are moving forward with bills to tax guns and ammunition to fund emergency services for gunshot patients.