Harford delegates and senators brush off O'Malley's hint of tax increases

Harford County's elected officials are surprised that Gov. Martin O'Malley mentioned the possibility of raising taxes this upcoming year, but had mixed views on how likely it was to happen, or what the state's economic situation actually might be.

They also, not surprisingly, said they would oppose any such tax increases and criticized O'Malley for the suggestion.

O'Malley told local government leaders last Saturday at the annual Maryland Association of Counties convention in Ocean City that tax increases could be on the table and the uncertain federal budget means the state's economic picture remains up in the air.

"We must be willing to adapt. … We will have to make more cuts, and at the same time — to protect our children's future — we must be open to new revenues," O'Malley said at the convention.

Sen. Barry Glassman said he was not surprised by O'Malley's statements.

"That's nothing new, and it's not going to happen in special session," Glassman said, explaining the budget and taxation chairman said tax increases would not happen there. He said he expects congressional redistricting to be the focus in mid-October.

He said the state continues to spend about $1.5 billion more than it takes in and does not see much changing.

"We are really in the same boat we have been in for the past three or four years," Glassman said. "I know the reason the governor is scared is for the past two or three years, he has used [stimulus] money from the Obama administration and that's going to dry up…It's kind of business as usual in Annapolis."

He did say the possibility of taxes going up is real in some respects.

"I think what they are really going to look at is expanding their sales tax to services," he said. "We have used so much federal money to prop up our budget. If I did that type of budgeting, I would be afraid, too."

Glassman said Maryland has fallen to 47th place in the country in job creation.

"That's bad news, too, because you make most of your money on income and property taxes," he said. "[The O'Malley administration's] mindset is, 'Where do we find more money?' so now it looks like they will really pick and choose which services to expand their sales tax on."

Del. Rick Impallaria said the only thing that should be discussed during special session is redistricting.

He also said his discussion with O'Malley indicated the governor is not planning to raise taxes.

"When I talked to him on the sly, he said he didn't believe he was going to," Impallaria said. "I am concerned if they have thoughts of raising taxes. It is not what they should be doing, but you can never tell what these people should be doing."

Del. Susan McComas wrote in an e-mail that she would not support any increase in taxes, fees, tolls or charges to the public.

"I have watched for months the decline of housing values, 401(k) plans, stocks, and bonds. I fear savings accounts will be the next victims if inflation rears its cruel and ugly head," she wrote. "It is not a stimulus to the economy to raise taxes during a recession or depression. The Governor needs to make tough budget decisions and set priorities as families have done during the past several years. The Governor should  not punish the Maryland taxpayers because he refuses to make the hard choices."

McComas also said she did not expect O'Malley to actually take her advice.

"I am very worried that he will make the wrong choice as he did during the 2007 special session," she wrote.

Del. Mary-Dulany James, a Democrat, called O'Malley's comments "unwise and probably unwarranted" but also hesitated to respond to what "new revenues" could mean.

"That is such a broad and ambiguous statement that it's hard to put it in context," James said. "I am doubtful that there's a revenue that needs to be raised right now."

She said she believes the focus should be on job creation, and the revenue will follow.

She added, however, "the governor is just putting out there an issue that does need to be discussed: the fiscal future."

If the federal government "suddenly pulls out a lot of revenues from that, we would have to look at that," James said about possible increases, then clarified that she nevertheless did not want to see taxes raised. "I would not be receptive to it at all," she said. "We live in a new reality."

Sen. J.B. Jennings said he takes the prospect of higher taxes more seriously.

"I think it's very possible," he said. "When the governor tends to say stuff like that, he tends to follow through it."

Jennings likewise said he does not think it will happen in the special session, but "I think it's going to be on the table."

He said he would continue to be against any suggestion of higher taxes.

"I am going to resist it because I still think there are cuts that can be made in the state budget," Jennings said. "The worst thing we can do is impose higher taxes on people."

Jennings also said he thinks the federal picture is not as cloudy as O'Malley implied.

"I think the federal budget is very certain. We know where it is," he said, noting the debt limit was increased. "I think it's pretty certain that the federal government in the short term is going to be OK."