The preliminary approval of an extension and increase in Baltimore's bottle tax is a welcome sign that the city is committed to addressing one of the most significant long-term drains on its vitality: a system of decrepit school buildings desperately in need of renovation, modernization and replacement. But as important a step as the City Council is taking, it must not be the last one for the city. The bottle tax by itself is expected to raise about $10 million a year — a pittance compared to the system's estimated $2.8 billion in needs. The city's leaders are demonstrating a commitment to taking politically difficult steps to address this problem. Now they and their counterparts in the State House need to demonstrate a willingness to take some creative steps to maximize that effort.
The enactment of a new tax, particularly in Baltimore, is no cause for great celebration. Residents here already suffer disproportionately from poverty and high taxes, and this levy is bound to have at least some negative effect on city grocers and other retailers. It is not something to be taken lightly. But the tax the council is poised to enact as early as Monday is unusual in two ways.
First, it is an entirely voluntary tax. The city's poor are not forced to buy soda, bottled water or sports drinks in containers smaller than 2 liters. In fact, proponents of school construction are seeking to make the elective nature of this tax into a selling point for city retailers; rather than seeking to hide the tax, they are suggesting to make it a point of civic pride for residents to buy their drinks in the city and fund new schools.
And second, it is unlike the many other tax increases MayorStephanie Rawlings-Blakeand her predecessors have enacted in that residents will get something new and concrete for their contributions. All of the other tax increases in the last decade have been aimed at avoiding steeper cuts in already diminished city services. This one amounts to a real investment in growing the city once again.
To keep that faith, Ms. Rawlings-Blake, the council, school officials and the city's legislative delegation need to bring some urgency to their efforts to find alternative means to finance improvements for the school buildings. During this year's General Assembly session, city schools CEO Andrés Alonso pitched an ambitious plan to leverage the bottle tax and existing state and local construction funds to back a bond issue of more than $1 billion. The idea was modeled after similar efforts in other states, but it represented a significant departure from the way school construction has been funded in Maryland, and the matter was set aside for a summer study. A group examining the issue is set to hold an organizational meeting on Monday.
At the very least, the General Assembly needs to enact legislation that will allow the city to dedicate the revenue from the new bottle tax — which would not go into effect for a year — to school construction. Such a law would facilitate the use of the money to back bonds and allow the city to leverage its new revenue stream to do more construction work up-front. The study group is also required to consider the creation of an independent school construction authority to manage the projects. Such a structure could help create economies of scale in construction projects and could clear up confusion about how responsibility for repaying any bond issues is divided among the city government, school system and state.
Meanwhile, Mr. Alonso needs to release the results of a survey he commissioned of the city's school facilities. The $2.8 billion estimate is based on a study conducted by the ACLU and others, but Mr. Alonso's survey is expected to include proposals for closing and consolidating underutilized schools or ones whose conditions have deteriorated so far that they are beyond repair. School closings in the past have typically been fraught — communities tend to prefer that someone else's school be closed — but this time, the system can legitimately hold out the promise that parents and students will really get something new and better.
Above all, city and state leaders need to make sure the bottle tax leads, as quickly as possible, to shovels in the ground. Years of decline have led to general cynicism about Baltimore's ability to improve itself, but the sight of a new school rising in the city could begin to change that. Baltimore's high taxes are generally a disincentive to city living. But this one, if handled properly, could make Baltimore attractive to a whole new generation of families, and that would more than overcome the cost of a few more pennies on a bottle of soda.