OCEAN CITY -- Gov. Martin O'Malley announced yesterday that he will seek a major infusion of transportation funds next year, an indication that he will propose more new taxes than the minimum needed to eliminate the state's projected $1.5 billion budget shortfall.
The governor offered no specifics of how much he would seek to raise or how he would do it, though higher gasoline taxes are a likely possibility. Local leaders gathered here for the Maryland Association of Counties warmly embraced O'Malley's commitment, saying they suffer from years of under-investment in roads and mass transit, leading to some of the longest commuting times in the nation.
The governor said the recent collapse of an interstate bridge in Minnesota underscored the need for Maryland to increase its infrastructure investments.
"I'm sure that all of you thought, as I did, when the bridge collapsed on Interstate 35 in Minnesota: 'Can it happen here?'" O'Malley said. "It can happen here. It can and will happen in every state in the union unless we recover our future preference and make investments."
Maryland hasn't increased its gas tax since the early 1990s, and because the tax is calculated on a per-gallon basis and not as a percentage of the cost of fuel, the recent increase in gasoline prices has not resulted in a windfall for the state. The Department of Transportation estimates the state has a $40 billion backlog in road and mass transit projects.
"Unless we address that, we are going to risk our quality of life," said Montgomery County Executive Isiah Leggett, a Democrat. "We're seeing people stuck in congestion ... and we're in denial if we think it's going to get better."
O'Malley's transition team recommended a gas tax increase, and Senate President Thomas V. Mike Miller pushed for one during this year's General Assembly session. His plan would have added 12 cents per gallon to the tax and would have made further increases automatic as the price of gasoline rises. That proposal would have raised about $425 million a year, which could be leveraged through bond sales into billions for transportation projects in the coming years.
Maryland's gas tax is now 23.5 cents per gallon, which is lower than Pennsylvania and West Virginia but higher than Virginia, Delaware and the District of Columbia. Miller's proposal would have made Maryland's rate one of the highest in the nation, but it is not clear that O'Malley would push for so large an increase. He could also use other mechanisms to raise funds, such as higher taxes on the sales of cars.
The gas tax is the one levy that receives support from major business groups in the state, such as the Greater Baltimore Committee. Those groups have argued that an inadequate transportation system threatens the state's prospects for economic growth.
Wayne Cooper, the president of the Charles County Board of Commissioners, said O'Malley has clearly been listening to the needs of local leaders.
"We have got about a $150 million transportation program going on with county funding, and it's having a pretty major impact," said Cooper, a Democrat whose county is one of the fastest-growing in the state. "We're trying to keep up with all the growth in our public education system and public safety system. ... We need to find the money. We're neglecting our future if we don't."
But not everyone is sure a tax increase for transportation is necessary --not now, when the governor is also planning general tax increases to help solve the budget deficit. Because transportation funding is kept separate from the funds that pay for schools, environmental protection and other state programs, more funds for roads and mass transit would not directly affect Maryland's budget problems.
Sen. Allan H. Kittleman, the minority whip from Howard County, said he thought the governor gave local leaders unrealistic hope for what he will be able to accomplish. In his speech, O'Malley also reiterated his goal of maintaining aid to local governments as he balances the state's budget, but "nobody in Annapolis believes that," Kittleman said.
"On transportation, he said we need some action, and we need it now," Kittleman said. "How about some action on the budget deficit? The question is, do you really need to do [transportation funding] at the same time you're fixing a $1.5 billion budget deficit? Are we biting off more than we can chew?"
The timing is also difficult because recent gas prices of more than $3 a gallon have made drivers much more sensitive to the issue, said Sen. Rona E. Kramer, a Montgomery County Democrat. Even though regular unleaded prices have since settled back to a statewide average of $2.72 a gallon, she said the governor would be wise to craft a multipronged approach to raising transportation revenues.
"There are other ways of doing it that are less painful," she said.
But O'Malley said the state shouldn't be afraid of enduring some short-term pain. Previous generations built the state's roads, bridges, airports and mass transit systems, and "it wasn't free in their day, either," O'Malley said.
"Let's do for [our children] what the greatest generation and our immigrant forefathers and mothers did for us ... relinquish the comforts of today for a better tomorrow," O'Malley said.
"Sacrifice" and "responsibility" were words the governor used frequently in his address. He said the decisions he and other state leaders will have to make in the next year as they balance the budget and seek greater investments in infrastructure will be politically unpopular but necessary.
"The solution has to involve raising revenue and reducing spending at the same time," O'Malley said. "Doing either of those things by itself is unpopular. Doing both at the same time is very, very unpopular, but our goal is not winning a popularity contest. Our goal is building a stronger Maryland."