Maryland retailers are again pushing for the state to collect sales taxes from online merchants not based in Maryland, helping them and potentially raising hundreds of millions for the state. Brick and mortar stores are struggling to compete with online sellers in other states, retail business interests testified in Annapolis on Wednesday in support of the Main Street Fairness Act of 2017.
A bill to pre-fund future pension and health insurance liabilities for state workers passed overwhelmingly in the House of Delegates last week in a 130-5 vote — and now waits in the Senate Budget and Tax Committee for a hearing. The bill, HB28, sponsored by Del. Carol Krimm, D-Frederick, would require 50% of the general fund balance in excess of $10 million be split equally between the pension system and the Postretirement Health Benefits Trust Fund, up to $25 million for each fund.
Several hundred rallied in Annapolis Thursday in support of the Keep The Door Open Act, a bill that would increase funding for mental health and addiction treatment and tie the reimbursement rate for service providers to the Consumer Price Index. A few hours later, the Senate Finance Committee voted to send the bill, SB 476, to the full Senate after 16 groups representing hospitals, service providers and nonprofits spoke in support of the bill. Opposition from two cabinet officials at the hearing won a small concession from Finance Chair Thomas “Mac” Middleton, D-Charles, who added an amendment that would sunset the act in five years.
In his State of the State speech Wednesday, Gov. Larry Hogan worried about the state’s pension system’s $20 billion unfunded liability, and urged legislators to pass a new pension option like a 401(k) for new employees. But in his fiscal 2018 budget, the governor withholds a mandated $50 million supplement to the State Retirement and Pension System due to declining revenue estimates that have left a slim $70 million surplus in fiscal 2017.
Through no fault of his own, Maryland Gov. Larry Hogan’s slimmed-down, $43.5 billion budget could implode at any moment, depending on actions in Washington by President Trump and a Republican-controlled Congress intent on slashing federal domestic spending.
Maryland’s legislative leaders are getting pressure to fix their approach to spending not just from Republican Gov. Larry Hogan but from their own top budget expert, Warren Deschenaux. In his analysis of the $43.5 billion state budget Hogan sent to the legislature last week, Deschenaux told legislators Monday, “This is another kick-the-can-down-the-road budget,” putting off hard choices about future spending.
The budget Gov. Hogan rolled out Wednesday is short on mandatory funding increases for workers serving Marylanders with developmental disabilities — putting providers in direct competition with fast food chains, said Senate Finance Chair Thomas “Mac” Middleton in a press briefing Wednesday. Hogan’s budget cuts the mandatory 3.5% wage hike to the Developmental Disabilities Administration to 2%. The legislature needs to make up the 1.5% reduction before the end of the session, said Middleton, a long-time advocate for DDA caregivers.
Maryland taxpayers could save $11 million annually if 127 of the current 1,426 uniformed positions in the Maryland State Police were replaced with civilian employees, according to a report released by the Office of Legislative Audits. The audit found the positions were not involved in daily law enforcement activities. The savings would be found in lower salaries and fringe benefits attributed to civilian employees, which would include a $7.8 million reduction in annual pension costs.
Maryland is dealing with another revenue shortfall and a budget that must be trimmed to make the state’s books balance. Yet to hear Gov. Larry Hogan tell it there’s no revenue problem –only “a spending problem” caused by Democrats in the General Assembly. Let’s get the facts straight on this one: If there’s a problem with spending the buck stops on Hogan’s gubernatorial desk, writes columnist Barry Rascovar. Editor Len Lazarick offers a counterpoint on four key issues.
Maryland tax revenues are expected to be down $365 million this fiscal year and another $418 million in fiscal 2018, a $783 million drop in what the state can spend, eating up all this year’s projected budget surplus. The estimate revision is the largest projected write-down since 2010, when the state was in the midst of recession recovery and the panel was off by 5%. “These are significant reductions in our estimates, and reflect the volatility that Maryland’s economy continues to experience,” Comptroller Peter Franchot said.