Comptroller, budget secretary concerned about cuts to pension payments

Comptroller Peter Franchot and Gov. Larry Hogan’s budget secretary are both raising objections to a proposal reducing state pension payments, saving money that may be used to increase education aid and state employee salaries.

“It is a bait and switch on rank-and-file teachers and state employees,” said Franchot, as well as “bait-and-switch” on the state’s rating agencies and taxpayers.

Hogan, business groups favor small business property tax break

Part of Gov. Larry Hogan’s promise to make Maryland “open for business” is a bill exempting many small businesses from the personal property tax collected by the counties.

The exemption would be given to businesses with less than a $10,000 property value, on items such as equipment, furniture, computers, tools and inventory. It applies to more than half of Maryland’s small businesses and will result in an estimated $7 million in tax relief.

Health advocates want state to stop taxing bottled water

Health advocates moved to make water the “default drink of Maryland” by submitting a bill that would repeal the 6% sales tax on bottled water.

Some health foundations spoke before the Senate Budget and Taxation Committee in support of SB 574 on Wednesday, where legislators identified the elephant in the room — a possible general fund loss of $20 million annually.

Major change in pension funding proposed, eliminating extra payments

The legislature’s staff is recommending that lawmakers make another major change in pension funding, eliminating extra payments into Maryland’s underfunded pension system and returning to full actuarial funding.

The proposal would save $70 million in next year’s budget and $2 billion over the next 10 years. But it would ultimately cost taxpayers $2.5 billion more than current plans for pension contributions in the following 13 years.

Bill restricts governors from shifting special funds to other programs

Lawmakers are moving to restrict the ability of future governors to shift money between special and general funds during the operating budget creation process.

The Dedicated State Funds Protection Act (HB 787) would amend Maryland’s constitution to prohibit the governor from relocating special funds to the general fund, which is often done during the budget-balancing process and then often not repaid.