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News Opinion Editorial

If not the bottle tax, then what?

Baltimore City has a serious problem with run-down, antiquated school facilities. They represent a major impediment to progress in improving the education of Baltimore children and a drag on the city's efforts to shake off decades of decline. MayorStephanie Rawlings-Blake's plan to fund a new school construction and renovation program through an extension and increase in the city's bottle tax may not be the perfect solution, but it is a good start.

The beverage industry has mounted a campaign of opposition to the proposal that borders on the hysterical. Its advertising campaigns cast sugary sodas, teas, fruit drinks and bottled water as necessities of life that the city would cruelly put out of the reach of Baltimore's working families. And the industry has issued dire warnings of job losses and spreading food deserts if the current 2-cent bottle tax is extended past its expiration next year and increased to 5 cents.

The industry has produced evidence to back up its claims, but not all of it is convincing. It points to the closure of a Pepsi bottling plant in Baltimore, but the tax is levied on the sale of bottled beverages, not their manufacture. And it commissioned a study from the Sage Policy Group that labels the tax as "economically destructive" in its executive summary but concedes later that "there is not a considerable body of additional data regarding the impacts of the [current] bottle tax." Rob Santoni Jr., the chief financial officer of Santoni's Supermarket in Highlandtown, offered more specifics: His total sales have dropped by $437,000 since the bottle tax went into effect, with more than a third of the decline from beverage sales. That amounts to about a 2.7 percent decline in his overall volume.

The laws of economics suggest that increasing the tax for a given product, particularly for a discretionary purchase like bottled beverages, will reduce sales. Members of the City Council need to weigh that as they consider Mayor Stephanie Rawlings-Blake's bottle tax proposal. But they also need to consider the economic drain on the city caused by its dilapidated, outmoded school facilities. Which is more likely to hold the city back? The beverage industry warns that the bottle tax could send some city residents across the county line to shop for groceries. The condition of the schools sends them across the border for good.

It's true that Ms. Rawlings-Blake's bottle tax would not be a comprehensive solution to the city schools' facilities crisis. But it could be an important start in the effort to amass the cash flow that will be necessary to support hundreds of millions, and perhaps billions, of dollars in bond issues for school construction and renovation. By itself, the measure would contribute $10 million a year, and in combination with a re-dedication of $12 million in other school funds plus 10 percent of the city's proceeds from its as-yet unbuilt casino, the mayor estimates she could support $300 million in borrowing. Put another way, the bottle tax, by itself, could be enough to build 10 new elementary schools.

Perhaps more significantly, it would demonstrate to state legislators that the city is serious about tackling its school facilities problems and could encourage them to take more aggressive steps to assist in the effort. City schools chief Andrés Alonso pitched an ambitious plan to give the city more certainty and flexibility in its school construction funding in the years ahead so that Baltimore could emulate some other cities that have undertaken comprehensive construction and renovation programs. State lawmakers were intrigued but skeptical, and a study of the concept is due to be completed in time for next year's legislative session. But it became clear during this year's debate that state lawmakers want to see a sign that Baltimore is willing to make a sacrifice to move forward with a school construction program before it considers the city's more ambitious proposals.

That said, there is no reason to short-circuit extensive council debate on the subject — as Ms. Rawlings-Blake's chief floor leader, Council Vice President Edward Reisinger, is trying to do by suggesting the bill go to the full council for a vote even without approval of the Taxation and Finance Committee. That panel includes some skeptics of the mayor's plan, including its chairman, Carl Stokes, and there is no reason not to allow them the opportunity to consider whether the mayor's goals for school construction could be achieved through other means. But they should make no mistake: If they don't think the bottle tax is the right way to kickstart Baltimore's school construction program, the onus is on them to find a viable alternative.

Copyright © 2014, The Baltimore Sun
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