MD.— Maryland lawmakers reached an agreement on Wednesday to reduce proposed tax and fee increases to a much more modest level after a $1.3 billion package was deemed too high in the current economic climate, especially in a high-stakes Senate race. The collapse of Baltimore's Francis Scott Key Bridge by a cargo ship last week exacerbated fiscal concerns.
As Republican former Gov. Larry Hogan ran as the GOP's most competitive U.S. Senate candidate in Maryland in decades, some in the Democratic-controlled chambers publicly complained that now was not the time for big tax, fee, and toll increases. Hogan is a rare Maryland Republican who won two terms as governor, largely due to his criticism of tax increases that resonated with tax-weary voters in his shock victory in 2014.
“If you go back to 2014 and 2018, I think it's not brain science to see what happened and how the former governor was successful in the state of Maryland, and so that context is very real, and we have to be honest about it,” Baltimore Democrat Ferguson said Tuesday.
Hogan, who gained favor early in his first term by cutting tolls statewide in 2015, has criticized the revenue agreement that caused a parliamentary budget conflict. On Wednesday, he stated that the Maryland House measure “would cost us jobs and hurt Maryland families already squeezed by historic inflation.”
“Enough is enough,” Hogan wrote on X. “Let's reject these tax hikes and signal the end of politics-as-usual.” The topic has unusual repercussions outside the state. Senate Democrats have a slim 51-49 majority.
Despite his ability to turn Maryland into a Republican stronghold, a Washington Post-University of Maryland survey released late last month showed Hogan remains massively popular. Despite his unknown opponents, the poll suggests that Maryland voters still want a Democratic U.S. Senate.
Maryland Democrats rarely have to worry about the GOP in the state capitol due to solid majorities in the House and Senate and a 2-1 voter registration lead. But Hogan is a rare Maryland Republican with two statewide victories. His Democratic opponents, U.S. Rep. David Trone and Prince George's County Executive Angela Alsobrooks, haven't done that.
In January, Democratic Gov. Wes Moore offered a balanced $63 billion budget without tax hikes for the following fiscal year. The Maryland Senate mostly upheld his budget plan despite a revenue forecast reduction after the governor filed it. However, the House added new income from transportation-related user fees, corporate tax reform, and internet gambling to the budget. Internet gambling and corporate tax proposals were rejected by the Senate.
Following lengthy negotiations between the two chambers, Moore signed an executive order earlier this week to extend the session by 10 days if necessary. Not necessary.
New transportation revenue could reach $350 million in three years under the plan. Vehicle registration fees are raised to cover mounting state emergency trauma expenditures. Electric vehicle owners must pay a new levy to make up for gas tax money they don't pay. A new statewide ride-hailing fee was added. Higher speeding fines in construction work zones are also part of the idea.
The accord also includes $80 million to $90 million yearly from tobacco tax increases, including $1.25 per pack. The Blueprint for Maryland's Future, a three-year education funding plan, will be funded with the money. Statewide transportation funding problems will remain a challenge for lawmakers next year. In December, Maryland's transportation secretary proposed $3.3 billion in cuts to its six-year transportation spending plan due to inflation and declining revenue sources.
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