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The Baltimore Sun

No income tax hike, no pension cost shift likely temporary as legislature fails to enact budget

Legislators failed to approve a bill raising some state income tax rates by the time the Maryland General Assembly's regular session ended midnight Monday.

While the failure of this and another budget plan involving a shift in teacher pension costs to the counties will be welcome news among most Harford County residents, any euphoria locally is likely to be short-lived.

With the legislators failing to enact a new budget, a so-called "doomsday" budget with $500 million in cuts will be put in place at the beginning of the next fiscal year on June 1. At least it will stand that way until the governor decides to call a special legislative session, which most legislators say is almost certain.

The last time the legislature did not complete work on the state budget by the end of the legislative session was in 1992.

Besides the income tax measure, which would put individuals who earn more than $100,000 a year and couples who make more than $150,000 annually in a higher tax bracket, the assembly also didn't vote on a related bill that would allow a casino inPrince George's Countyand table games at all Maryland casinos, including at Hollywood Casino Perryville.

The last minute budget hold-up was "highly unusual," Western Harford Del. Kathy Szeliga said Monday.

"The only job we have to do in Annapolis is to pass the budget," she commented.

Monday afternoon before it became clear that work would not be completed by the midnight deadline, Szeliga had said: "I will be extremely disappointed with the leadership in Annapolis if they don't get it done tonight."

She was just that.

Gambling fever

The delay on Monday that led to the budget fiasco, Szeliga said, was the result of "Senate President [Thomas V.] Mike Millerholding it [the budget] hostage until he can put gambling in National Harbor," the resort along the Potomac River south of Washington.

The budget was "virtually finished," she explained, but the measure to expand the state's slots venues and to allow table games was the big sticking point.

"I think we haven't even fully implanted the slots measure that was passed," Szeliga said.

She called the measure "hasty" since not all gambling venues, such as Arundel Mills Mall and in Baltimore City, haven't even opened yet.

Even though the gambling bill essentially died, Western Harford Del. Pat McDonough believes it will come back if a special session is called. Several local delegates also think the issue will go to referendum for a vote in November.

House SpeakerMichael E. Buschalso blamed the lack of budget action on the Senate.

"I think it is pretty evident that our counterparts in the Senate slow-played all the revenue bills," Busch to The Baltimore Sun.

Teacher pension shift

A huge component in helping to balance the state's $35 billion budget was to shift a portion of teacher pension costs over a period of four years from the state to the counties. The shift was expected to cost Harford County as much as $9 million annually to start.

This change also did not pass.

Shifting the responsibility to the local level is one Southern Harford Del. Mary-Dulany James agrees with, although some of her fellow Harford delegates don't.

The Havre de Grace Democrat said the way things are now with teacher pensions is an "unsustainable system," and she believes the counties have the resources to support the shift.

Special session

Though Gov.Martin O'Malleyhas yet to request a special session, legislators believe it's only a matter of time.

"Lord knows what anything is going to look like at the special session," James commented.

She clarified that while the governor can specify what measures he wants to be addressed, like the regular session, any bill can be put on the table.

When a special session would happen, Northern Harford Sen. Barry Glassman isn't sure, but he thinks it could be in June, with just weeks or even days to go before the end of the fiscal year on June 30.

Some of his fellow legislators, however, have said it they could be back in Annapolis as early as next week.

Glassman says the income tax and gambling bills could be dropped, though only to be taken up again for the 2013 session.

Higher flush tax

Despite the failure in approving several finance measures, the session did bring about the passing of many that were on O'Malley's agenda.

The so-called "flush tax," formally called the Chesapeake Bay Restoration Fund, will be doubled from $2.50 per household per month to $5, passing the House 89 to 48. That means an annual bill of $60 for Harford home owners, double what they pay now.

Funds from the tax go to upgrading sewage treatment plants in the state, though critics say the tax is self-defeating, promoting more development.

The tax bill excludes areas in the state that are not part of the Chesapeake Bay watershed, such as Garrett County and parts of the Eastern shore.

O'Malley's other green initiative to lessen the use of septic systems also passed, though in a supposedly watered down form.

While counties will be the ones to make decisions on land use, the measure requires them to mark certain areas off-limits for septic systems.

Same-sex marriage

One of the most controversial bills to be passed this session was the same-sex marriage bill, which made it through the House and Senate by a slim margins.

Even though O'Malley already signed the bill, which would go into affect January 2013, many believe the issue will go to referendum and be voted on by the public in November.

Passage of same-sex marriages wasn't a highlight of the session for any of Harford's legislators. All eight of the county's delegates and its three senators voted against the legislation.

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