Counties Told to Brace For Cuts and Look For Revenue Alternatives

Maryland’s counties were sent a pretty clear message by Senate President Mike Miller and House Speaker Mike Busch at the Baltimore Business Journal and WEAA Radio 88.9 Annapolis Summit hosted by Marc Steiner, “Maryland’s city and counties are going to feel lots of pain as the state looks for ways to slash a $1.6 billion budget deficit.”

Local governments will have to make tough choices and even raise local taxes if they aren’t able to handle cuts expected from Annapolis.Miller made it clear that taxes at the state level aren’t likely. “The power to tax is the power to destroy,” he told WEAA radio host Marc Steiner at the Governor Calvert House.

But he also pointed out that local governments, specifically rural counties like Frederick County, will have to look at long neglected sources of tax revenue to offset cuts in education and other services. In the past, these counties have relied on the state’s piggyback taxes to keep property tax levels low and to avoid other revenue-raising efforts, he said.

“There will be significant pain at the local level,” Busch said.

During the same Summit, Governor O’Malley reiterated that his proposed budget will include significant budget cuts to bring it in line.

The governor said he will work to preserve education, public safety and other essential services for Marylanders. But that, along with everything else — the arts, environment, transportation — could be on the table.

Meanwhile, the Baltimore Sun reports, counties are being looked to for alternatives to the Governor’s budget, including options to raise taxes.

In a session where the state’s freshly reelected 188 lawmakers and O’Malley must close a $1.6 billion deficit, the legislative leaders made it clear that lobbying by the counties will play a key role, particularly if the governor continues defer to others on the tax debate.

The Democratic leaders said they will look to Baltimore and the 23 counties to reject O’Malley’s budget and propose alternatives to lawmakers. Options could include increases to state taxes on millionaires, gasoline and alcohol. Or county officials could hike local property and income taxes, they said.

When they see what’s in store, Busch said, county leaders might want to make their case to lawmakers.

“If there is some kind of reaction from county executives and city governments to come to Annapolis and say, ‘This is not palatable for us. We have to look at some alternative,’ ” Busch said, “I think many members of the General Assembly and the governor will get together and find if there is some way to increase revenues.”

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