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More gambling is not the answer for Maryland

State Income TaxIncome TaxCasino and Gambling IndustryBusinessPersonal Income

Less than three months after the Maryland General Assembly met in a special session to raise the state income tax on many middle-class families, there is a growing likelihood that lawmakers will soon descend on Annapolis again. This latest special session would pave the way for the construction of a new casino inPrince George's County and, in all likelihood, result in a much lower tax rate for Maryland's private casino operators.

With all due respect to Gov.Martin O'Malleyand Senate President Thomas V. Mike Miller — the principal architects of this proposal — I believe this represents the wrong approach to our state's fiscal challenges and sends the wrong message to the working people of our state.

Awarding tax breaks to the national gambling industry, after we have repeatedly raised taxes on Maryland families and businesses, would represent the most profound misplacement of priorities that I have seen in my 25 years in public life.

The state has raised personal income taxes, business income taxes, sales taxes, alcohol taxes, vehicle titling taxes, bridge tolls and many other fees at a time when too many people are struggling. Watching their leaders move with such alacrity to do favors for gambling magnates, one could understand why they would feel betrayed by a state government that is supposedly one of the nation's most progressive.

Maryland is in fiscal danger. Despite the steady diet of higher taxes, and despite legalizing slots four years ago, we are still carrying a structural budget deficit of $548 million. We are responsible for about $35 billion in unfunded pension and retiree health care obligations, and we are on track to near, if not exceed, the state's debt ceiling in 2017.

Despite increasing state spending by 20 percent over the past five years, which was supposed to accelerate Maryland's economic recovery, the state has been one of the nation's leaders in job losses for the past two months and was one of only eight states that experienced a decline in average private-sector hourly earnings last year. Our current approach just isn't working.

It's time to put our obsession with slots back on the toy shelf where it belongs. Gambling isn't the answer to our problems, and it never was. Instead, we owe it to Maryland's working people to have a serious and overdue discussion about how we can get our fiscal house in order without resorting to new taxes, spending and debt.

That discussion should include opportunities to deliver better public services at a lower cost and to generate more government revenue without higher taxes, by making better use of technology. In my agency, we have worked aggressively to encourage record numbers of Marylanders to file their taxes electronically, which has saved the state millions while ensuring that most Marylanders will receive their refunds in three business days. We have also applied the innovative concept of "data warehousing" to our tax collection efforts, and in less than three years have already recaptured nearly $170 million in once-uncollectable tax debts.

I firmly believe that similar opportunities exist within every agency of state government, if only we summon the will to find them and capitalize accordingly.

The discussion should also include ways to make Maryland a more attractive destination for private-sector job creation. In addition to holding the line on higher taxes, we must offer employers a consistent and predictable regulatory environment while providing them with responsive customer service. Government cannot always provide businesses with the answers they're looking for. However, we must do a better job of answering their questions in a friendly and timely manner while doing everything in our power to help them navigate the government process and achieve their objectives — to succeed in a competitive marketplace while creating good-paying, family-supporting jobs.

If the governor and legislature insist on coming back to Annapolis this summer, I suggest they make it worth the time and expense by taking up these issues instead. Otherwise, the national gambling industry will simply reap another undeserved windfall while the rest of us will be left holding the bag.

Peter Franchot is the comptroller of Maryland. His e-mail is pfranchot@comp.state.md.us.

Copyright © 2014, The Baltimore Sun
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