Miller says higher gas tax is coming

State Senate President Thomas V. Mike Miller predicted Thursday that the General Assembly would approve an increase in Maryland's gas tax, putting his considerable influence behind an issue that is likely to be divisive in the coming legislative session.

"There's going to be a gas tax," Miller said flatly in an address to Maryland business leaders meeting here. "Is it popular? No, [but] it is going to have to get done now."

Miller and House Speaker Michael E. Busch spoke at the Maryland Chamber of Commerce Business Policy Conference. Busch described the outlook for a tax increase differently, saying that lawmakers in Annapolis are looking at ways to fund a large-scale public works program. But he did not specify how.

"How do we come up with an aggressive funding source to improve our capital infrastructure and put the labor force to work?" Busch asked. "That is what we have to go back to Annapolis and do."

Their remarks were largely in step with a theme set by Gov. Martin O'Malley last month when he asked legislators to support finding new revenue to pay for public works projects and thus create construction jobs. All three are Democrats, though they do not always agree on policy.

The governor made his pitch again Tuesday evening when addressing a conference of leaders from Maryland's towns.

"I think that the mayors of the towns and cities of Maryland understand better than most elected officials how important our infrastructure is," O'Malley said later.

Maryland Republicans have made clear they are opposed to raising taxes.

"There is something illogical about raising taxes to create jobs," said Sen. Nancy Jacobs of Harford County, who recently stepped down from a leadership post because she is considering a run for higher office.

Del. Anthony J. O'Donnell, the House Republican leader, said his caucus would not support a gas tax increase.

"When people are banging on the door for a tax increase, think about the little guy," he said, telling business leaders that consumers already are strapped and can ill afford more taxes and fees.

Busch's comments suggest that if legislation to increase the gas tax is introduced, the bigger fight is likely to be in the House of Delegates.

"I don't see anyone here standing in line to vote for a gas tax," Busch said. "They are not."

A state task force has proposed raising the state's 23.5-cents-per-gallon gas tax by 15 cents as a means of bolstering the Transportation Trust Fund and paying for a backlog of road repair and construction projects. Miller, while supporting an increase, has said 15 cents would be too high.

Miller said the legislature would have to pass a constitutional amendment to limit use of gas tax revenue to transportation projects, even though he thinks state officials need budget flexibility. Such an amendment would have to be approved by voters on the 2012 ballot.

Maryland business advocacy organizations have been supportive of raising the gas tax if the revenue is walled off from the rest of the state budget and could be used only for transportation projects.

In fiscal year 2009, the General Assembly diverted about $218 million in sales tax revenue intended for the Transportation Trust Fund to other parts of the budget. This year, the Assembly transferred $100 million out of the trust fund, though the state has repaid $40 million of that.