January 11, 2011

Blog: Franchot preaches “age of austerity”

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Peter Franchot

Comptroller Peter Franchot

Comptroller Peter Franchot told a meeting of nonprofit groups Monday that the government should “take a time out on tax increases” — while the group’s leadership continued to press for more tax hikes.

“If we don’t have fiscal responsibility, we are not going to be able to do what we want socially,” Franchot told more than 100 leaders of Maryland Nonprofits in Annapolis for a legislative preview. “We need to scrub the $32 billion budget.”

Many of the members of Maryland Nonprofits provide health care and other services to people with physical, mental and developmental disabilities.

Peter Franchot

Comptroller Peter Franchot

They are pressing for a dime-a-drink increase in alcohol taxes, and the association’s leadership also wants to expand the sales tax, continue an income tax surcharge on million-dollar incomes, and impose corporate taxes known as combined reporting.

But Franchot said “we’re not confronting the root problems” in state government. He praised the nonprofits for their innovation and effectiveness in providing services, and criticized state bureaucrats faced with budget cuts who were willing to “throw you all overboard” while maintaining the same inefficiencies and ineffectiveness in their own agencies.
Franchot rejected “the draconian cuts” being proposed by “extremists on the right” and people on the left who want “to treat the business community as a bottomless pit.”

Franchot was one of the more liberal members of the legislature during his 20 years representing Takoma Park and Silver Spring. “I’ve voted for more tax increases than [the number of] people in this room,” he admitted. But he said there needed to be “a moratorium on taxes” while the state got its fiscal house in order. He said revenues from new taxes would take the pressure off the need to trim state government as Maryland embarked on an “age of austerity.”

Franchot was a leading opponent of slot machine gambling, but he has been largely quiet on the issue since voters approved it in 2008. But he railed against any attempt to expand gambling as a revenue source.

“People are losing their homes and what are we offering them in Maryland? Slot machines. No thank you. That’s not the Maryland I’m proud of.”

Maryland Nonprofits is not proposing more gambling, but it is backing new revenues in addition to budget cuts.

“A steady diet of cuts,” as Gov. Martin O’Malley has proposed, “will leave us sick, stupid and unsafe,” Neil Bergsman of the Maryland Budget and Tax Policy Institute told the nonprofit leaders.

—Len Lazarick
Len@MarylandReporter.com