Md. booze tax break down

As the General Assembly debates a 50 percent increase to the sales tax on alcohol, here’s some background. It’s the comptroller’s fiscal 2010 report on alcohol excise taxes — not the sales tax — which can be helpful in terms of context.

Since the legislature bumped the sales tax across the board from 5 percent to 6 percent, wine and liquor sales continued to increase while beer sales have declined. That tax bump took effect January 2008, halfway through fiscal 2008, where the decline begins, but that could also have something to do with the recession that began a month before. Here’s the data:

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010
Beer $ 9,447,020 $ 9,509,503 $ 9,451,537 $ 9,235,671 $ 9,137,176
Wine $ 4,865,083 $ 5,100,636 $ 5,221,572 $ 5,365,296 $ 5,600,053
Liquor $ 13,669,152 $ 14,165,195 $ 14,334,222 $ 14,707,951 $ 15,163,580

The report also includes a county-by-county breakdown for alcohol consumption. In gallons:

Liquor Beer Wine Total
Worcester 4.94 59.18 5.4 69.52
Cecil 6.86 28.72 3.27 38.85
Garrett 2.18 27.37 2.35 31.9
Queen Anne’s 1.91 25.46 3.45 30.82
Kent 2.18 24.22 3.71 30.11
Talbot 2.39 21.3 5.88 29.57
Allegany 1.73 25.9 1.33 28.96
Anne Arundel 2.09 21.74 3.85 27.68
Dorchester 1.65 23.25 1.86 26.76
Wicomico 1.14 22.6 2.02 25.76
Washington 1.81 22.34 1.58 25.73
Calvert 1.78 20.58 2.5 24.86
Baltimore City 2.14 19.77 2.05 23.96
Caroline 1.34 21.23 1.16 23.73
Carroll 1.43 19.63 2.38 23.44
St. Mary’s 1.5 19.93 1.73 23.16
Frederick 1.6 18.58 2.44 22.62
Harford 1.39 18.07 2.22 21.68
Baltimore County 1.78 17.06 2.6 21.44
Charles 2.09 17.55 1.6 21.24
Prince George’s 1.79 15.84 1.54 19.17
Somerset 1.15 15.63 1.07 17.85
Howard 1.38 13.54 2.82 17.74
Montgomery 0.98 10.1 2.44 13.52

It’s not that those counties at the top of the list are full of bigger drinkers. It could be that they just visit, or pop across the border to pick up a 30-pack or a bottle of liquor. Worcester County is home to Ocean City, which if you’ve been there during the summer, you can see why that county’s numbers are so. And those other counties at the top of the list border jurisdictions with higher alcohol excise taxes — Delaware — and others with more draconian blue laws — Pennsylvania.

Md. alcohol tax would benefit school construction

If Maryland lawmakers succeed in raising the sales tax on alcohol from 6 percent to 9 percent starting July 1, most of the money would be used to boost school construction around the state.

The 24 local jurisdictions would split $47.5 million, with Montgomery and Prince George’s counties and Baltimore City grabbing the most funding.

The breakdown:

  • Anne Arundel, $5 million
  • Baltimore City, $9 million
  • Baltimore County, $9 million
  • Eastern Shore (Caroline, Dorchester, Kent, Queen Anne’s, Somerset, Talbot, Wicomico and Worcester), $1.25 million
  • Howard, $4 million
  • Montgomery, $9 million
  • Cecil and Harford, $1.25 million
  • Price George’s, $9 million
  • Southern Maryland (Calvert, Charles and St. Mary’s), $1.25 million
  • Western Maryland (Allegany, Carroll, Garrett, Frederick, Washington) $750,000

House passes Invest Md.

Gov. Martin O’Malley’s top economic proposal cleared the House of Delegates Friday on a 94-43 vote Friday. The state Senate c0uld start making its own changes to the Invest Maryland bill as soon Friday afternoon.

In a blog post Friday morning, O’Malley wrote the bill is “one of the most important pieces of legislation this session.”

The governor wrote:

Maryland ranks as one of the top three state for entrepreneurship and innovation and we are rich with institutes of higher learning, centers of innovation and R & D facilities. Yet, as a state, we lag behind others in providing our innovators with the early stage dollars they need to grow their companies and create jobs.

The House passed a version of the bill that trims the funding for the governor’s proposal, but expands it scope.

Invest Maryland would allow the state to sell tax credits to insurance companies to fill a venture fund to be targeted at high-tech companies. The committee’s version of the legislation cuts the amount of credits from the $142 million Gov. Martin O’Malley proposed to $100 million. Auctioning those tax credits with a floor of 70 cents on the dollar would yield the state $70 million in the House plan, as opposed to the $100 million in the governor’s bill.

The House’s version of the legislation, HB 173, also alters the distribution of the funds. One-third would be controlled by the Department of Business and Economic Development, which would focus its investments on entrepreneurial and early-stage companies. Two-thirds, or about $50 million, would be invested on the state’s behalf by private venture capitalists, with a focus on larger, growth-stage firms.

Principal and profits returned to DBED would be recycled into the program, while all returns from the private venture capitalists — 80 percent of the profits and all the principal of successful investments — would be pumped into the state’s general fund.

That would leave the private side of the program at the mercy of governors who set budget proposals and lawmakers who cut from them.

The bill gained preliminary approval Thursday, escaping a series of amendments largely unscathed. One change adopted would require DBED to post annual reports about who purchases the tax credits and who receives investments from the program.

The Senate Budget and Taxation Committee could take up the bill as soon as Friday afternoon or evening.

Update: City senator wants answers on lead paint judgments

State Sen. Cathy Pugh, D-Baltimore City, is seeking to hold back $17.5 million in funding slated for Baltimore until the city government comes up with a plan to pay $12 million in court judgments stemming from lead paint poisoning cases.

The Sun reported Sunday the city housing department says it can’t afford to pay the judgments. The story also says the department has spent $3.8 million defending itself in those cases since 2005.

Pugh called that “unconscionable” on the Senate floor Friday afternoon. Her amendment to the capital budget has been delayed because of a drafting error, and is expected to be taken up later today.

“What we’re asking for is a plan of action,” Pugh said. “You can’t turn your back on the citizens of Baltimore.”

“We need to send a message,” she said.

Pugh was backed by fellow city senators and lawmakers from both parties from around the state.

“One of the most horrible landlords is the city of Baltimore,” said Sen. James Brochin, D-Baltimore County.

Senate Minority Leader Nancy Jacobs called the legislation an example of “good government.”

Members of the Senate’s budget-setting committee, however, resisted the amendment, which would have to be added to the list of items to be reconciled between the House and Senate versions of the legislative session that ends Monday.

It’s “well-intentioned,” said Sen. Ed DeGrange, who chairs the capital budget subcommittee,”but not something we need to address through the capital budget.”

5:45 p.m. update

The Senate decided to adopt language regarding the lead paint judgments in the uncodified section of the bill, which shows the chamber’s intent but does not have the force that the original amendment would have.

And the city’s Housing Authority sent along a response to the effort in the Senate, which is long, but worth reading. I’ll post it below. The statement is from Executive Director Paul T. Graziano, by way of Cheron Porter, the authority’s spokeswoman.

“The Housing Authority of Baltimore City (HABC) is deeply sympathetic to anyone who has suffered from lead paint poisoning. The recently discussed cases were filed in the past few years; however, they involve incidents that occurred prior to the implementation of Maryland’s lead law in 1996. HABC has been fully compliant since its inception.

HABC has the great responsibility of providing homes for over 25,000 very low-income households throughout Baltimore city, while facing severe federal funding constraints. HABC faces over $800 million in claims and is in no financial position to pay these claims and still provide decent, safe and affordable housing for our current families, seniors and persons with disabilities.  Serving our city’s most vulnerable populations is our first priority. Therefore in addition to the above efforts, HABC voluntarily provides the Coalition to End Childhood Lead Poisoning 200 Section 8 vouchers to help the families of children with elevated blood lead levels move from lead contaminated private houses(unrelated to HABC’s programs) to relocate to lead safe homes.”

Invest Md. moving in House

The Invest Maryland bill got a preliminary OK from the House of Delegates on Thursday and skated through a volley of amendments mostly unchanged.

The program, Gov. Martin O’Malley’s top economic initiative, would allow the state to auction $100 million in tax credits to insurance companies to fill a venture fund with at least $70 million. (The auction has a floor of 70 cents on the dollar.) That money would be invested in high-tech early stage and growth-stage firms.

One change the House accepted of the seven proposed by Republican lawmakers added a reporting requirement to the bill. The Department of Business and Economic Development would have to post an annual report on its website detailing the purchasers of the tax credits and recipients of Invest Maryland investments.

“It’s intended to spread the sunshine,” said House Minority Leader Tony O’Donnell, who proposed the amendment.

Other amendments would have carved out funds for investment in urban areas and written DBED out of the bill. Under the House proposal, two-thirds of the funds raised by the tax credit auctions would be invested by private venture capitalists and one-third overseen by DBED. One proposal would have put the public share of the money under the control of the Maryland Technology Development Corporation, and another would have given it all to private VC’s.

The firms that invest on the state’s behalf would repay all of the principal and 80 percent of the profit on successful investments.

Invest Maryland will likely be up for a final vote Friday, and then head to the upper chamber, where senators are considering changes of their own.

Md. “bank local” bill gets killed

A bill that would have given preference to local, community banks competing for state banking contracts was killed by a House committee Wednesday.

The bill, HB 619, was similar to one introduced last year but tempered slightly to expand its appeal. The bill had supporters from both sides of the aisle, but ultimately failed to clear the Economic Matters committee.

The vote came in 16-4 against.

The bill would have required the state treasurer’s office to take into account, among prospective bankers’ other qualifications, whether or not they are chartered in Maryland, or if they have less than $5 billion in total assets.

Eight senators and 29 delegates signed on to the legislation.

The state has more than 1,200 accounts — the number has been as high as 1,600 — spread from the Eastern Shore to Western Maryland. Holding those accounts means fees for banks and, in some cases, capital with which to make loans.

Wind vote Thursday in Md. House committee

Dereck Davis, chairman of the House Economic Matters Committee, said Tuesday night that he expects his committee to vote on the governor’s wind energy proposal Thursday.

The committee has been considering some changes proposed by the governor to win over lawmakers skeptical about the costs. Davis previously said the bill could be voted on as soon as Wednesday, but the House has been preoccupied with other matters, including the capital budget, which passed Tuesday.

“They’re due a vote,” Davis said Tuesday evening after the chamber’s second session of the day. “We owe that to the administration to bring that up.”

Davis stuck to his prediction that the vote would be very close, a vote or two either way.

Indeed, Abigail Hopper, the governor’s energy adviser, stopped by the House chamber Tuesday just minutes after Davis spoke. She said she was to meet with Del. David D. Rudolph, the vice chairman of economic Matters, to discuss the wind bill as part of the administration’s effort to shore up its votes.

Md. wind power bill could move Wednesday

Del. Dereck E. Davis said the fate of the governor’s wind power proposal could come down to a “one or two vote outcome, either way.”

“I think it could go 12-11, either way,” said Davis, referring to the vote in the  Economic Matters Committee, which he chairs.

Gov. Martin O’Malley’s bill would require utilities to enter into long-term contracts to purchase 400-600 megawatts of electricity generated by a wind farm off the state’s Atlantic coast.

Concerns over the costs to consumers sparked interest in watering the bill down to a study this year, and O’Malley has twice moved to allay those worries. First, he proposed a price cap of $2 per month per consumer (as long as you use 1,000 kilowatt hours) for the first year of off-shore generation, then extended that cap for the life of the project.

“It most definitely is going to raise energy bills in the short-term,” said Davis.

A vote in Economic Matters could come as early as Wednesday, Davis said, adding that he supports the bill as a way to move Maryland to producing more of its own electricity.

“If we’re thinking about the future, this is the right way to go.”

Also Wednesday, the Senate Finance Committee, which is handling the bill in the upper chamber, is scheduled to hold a work session on the legislation.