Welcome to Week 2 of the Eye on Annapolis Podcast where we look back at the week that was and preview the week that will be in the State House.

The 2012 General Assembly session got off to a more contentious start than most expected.

Gov. Martin O’Malley floated the idea of raising the state sales tax a penny as he and lawmakers face a $1.1 billion budget deficit and calls to invest more in transportation, schools, water treatment plants and other infrastructure.

Senate President Mike Miller put an arrow through that trial balloon almost as soon as it launched.

With the governor’s budget on tap this week and much of his legislative package expected, we will soon see how he intends to close the budget gap, spur development of an offshore wind farm and raise money to spend more on roads, trains and other transportation projects.

Listen up.

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Senate President Thomas V. Mike Miller Jr. said Friday he doesn’t think lawmakers can round up the votes to raise the state’s gas tax during a special session this fall.

Miller, the most powerful advocate of raising the fuel levy in the General Assembly, told Brucy DePuyt on NewsChannel 8 that “we’re not going to be able to get the votes to raise the gas tax in October.”

More from Miller: “The problem is gas hovering almost to $5 a gallon. I don’t think public sentiment is going to be there in terms of the population, it’s not going to be there in terms of the legislature, especially with the uncertainty in the Middle East. So… somewhere in the near future we’re going to have to deal with it. But my prediction is with the current uncertainty, and the high cost of gas, we’re not going to be able to get the votes to raise the gas tax in October.”

That came just days after Miller sent a letter to Gov. Martin O’Malley and other lawmakers pressing for the gas tax and other mechanisms to raise transportation dollars to be on the agenda when the General Assembly returns in the fall for a special session on congressional redistricting.

Transportation funding has been a top issue for O’Malley since the legislature wrapped up its session last month. He has lobbied for the business community’s support on the issue, but the question of raising the gas tax has split traditional allies in the private sector.

The Blue Ribbon Commission on Maryland Transportation Funding has recommended the state seek $800 million in new transportation revenues every year.  Raising the gas tax — which has been at 23.5 cents per gallon since 1992 — would likely be a part of any revenue package put forth by O’Malley or legislative leaders.

Bumping the tax to 33.5 cents and indexing it to inflation would bring in an additional $385 million, the commission estimated. Applying the 6 percent sales tax to gasoline and diesel sales would yield $580 million.

Other options include raising driver license fees by $10 to yield $15 million, bumping transit fares by 25 percent, for $30 million, and raising emissions inspection fees by $10, to bring in $15 million.

The New York Times had an interesting story on Friday about an IRS report on tax return filing trends in 2008.

I know, I know. “Tax return filing trends can be interesting?” you’re asking yourself. Yep. That’s right. They can be. Now buckle up.

If you haven’t stopped reading already, here’s why: The data shows that in 2008, the country was hemorrhaging millionaires.

In the spring of 2008, when those tax returns were being filed, Maryland passed its controversial “millionaire’s tax” – the 6.25 percent tax bracket for those of us lucky enough to pull in more than $1 million a year. (That “us” in the last sentence was less inclusive of certain reporters/bloggers than you may think.)

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Northrop Grumman Corp., the one that got away, has finally settled on a new place to call home.

The defense giant that had drawn multimillion-dollar dowry offers from Maryland, Virginia and the District, chose in April to focus its search south of the Potomac in the fast-growing areas in Northern Virginia. The company chose a building near Falls Church on Monday, The Washington Post reported.

The Post’s story offers a few more clues as to what Northrop was looking for, and why Maryland didn’t fit the bill. The company’s decision has been influenced all along by the size of the buildings available, their locations and the incentives doled about by different jurisdictions.

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The last-minute scramble by office-seekers across the state to file their paperwork on time is over, but all that means is the real fun has just begun. Now, these races will actually play out.

I wanted to update our story on some General Assembly contests with the potential to be very, very interesting – both for the committee chairmanships the incumbents hold and the forces potentially at play in the districts – with a few more tidbits that didn’t make the original version.

Del. Joseph Vallario found himself in the spotlight often in the 2010 legislative session, perhaps most prominently during the brief attempted impeachment of Attorney General Douglas F. Gansler (who, incidentally, for all the fuss over the opinion he issued on gay marriage, is running unopposed.) Vallario, as head of the Judiciary Committee, led the vote that put an end to the impeachment.

Vallario drew more criticism, however, over complaints from female legislators that he treats them unfairly in his committee. Also, a drunk-driving bill died in Judiciary when Vallario didn’t put it up for a vote.

Those incidents have inspired opposition from within the Democratic party in Prince George’s County.

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The lobbyist scoreboard is up and the top earners and spenders in Annapolis in 2010 look very similar to those of 2009. Well, at least the names are the same. The dollar figures attached to them are much, much lower.

Here’s our story on the biggest earners and some of the big spenders. And I’ll post the full lists of lobbyists with more than $50,000 in earnings and corporations and organizations that spent more than $50,000 after the jump. The data comes from the State Ethics Commission.

Some other tidbits that didn’t make it into the story:

The health care industry and energy companies once again were strongly represented on the big spenders list. Given the size of the industries and the companies involved, and the issues at play in the General Assembly in recent years, that’s not surprising.

The Maryland Hospital Association ($327,000), MedChi ($285,000) and CareFirst ($238,000) were among the top 10 biggest spenders. So were Pepco ($324,000) and Constellation ($259,000).

There were a handful of bills in the past session that dealt with the relationship between doctors and insurers, but the big one was the Medicaid False Claims Act. The new law protects whistle blowers who reveal fraudulent claims and increases the penalties for the entities that file them. The state estimates $300 million in false claims are filed every year, and it catches less than 10 percent of those.

Energy companies monitored bills that strove to make electricity rates more transparent and likely had visions of the re-regulation battle waged in 2009 fresh in their heads. Constellation was the top spender last year with $681,000 paid to lobbyists.

More general business interests also had a busy year, grinding out a hard-fought compromise on unemployment insurance, successfully watering down shift-break requirements for retailers, upping tax credits for hiring unemployed workers and striking a deal on optional mediation during mortgage foreclosures.

The Maryland Bankers Association ($254,000) was 7th on the list, Maryland Association of Realtors ($238,000) placed 9th and, Maryland Chamber of Commerce ($189,000) was 16th and the Maryland Retailers Association ($188,000) placed 18th.

The list of top earners also shows some former legislators with lucrative careers following their time in the State House. American Joe Miedusiewski, who split nearly 20 years between the House and Senate and later ran for governor, pulled in $383,000 in 2010, good enough for 15th on the list. Barbara A. Hoffman, who spent eight years leading the Senate Budget and Taxation Committee, earned $234,000. And former Speaker of the House Cas Taylor pulled in $191,000.

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Normally the final minutes of Maryland legislative sessions sound something like a speed reading contest between the Senate President and Speaker of the House.

With hundreds of bills to push through in the final day and never enough time to get to them all, they take them up rapid fire, repeating a barely understandable string of standard commands. It goes something like: “House bill 272 is on second reading, all in favor say aye, those opposed, say nay, the bill is ordered printed for third reading, motion to suspend the rules for two readings in one day, all in favor say aye those opposed say nay, motion is adopted, House bill 272 is on third reading for final passage, the clerk will take the call …”

This is done dozens of time, up until midnight, when they’re legally required to stop and take nine months off to recover. Or at least they usually go right up until midnight.

The House of Delegates on Monday found itself without legislation for most of the final 10 minutes. Not one to upset tradition, Speaker Mike Busch — a record-setting running back at Temple University — found ways to run out the clock.

They thanked their committee staffers and the speaker’s staff. They thanked the state troopers who guard the chamber, one by one. The bomb-sniffing dog, who drew the loudest applause. The amendment drafters. The legislative budget and policy analysts.

Then they took a quick break to pass an update to toughen the sex offender restrictions in Jessica’s Law.

And then back to the introductions – a delegate’s intern. A husband. A wife. A delegate’s intern and his girlfriend. At some point, the Baltimore County delegation launched a remote control helicopter from their territory on the House floor.

Finally – mercifully for some – the digital clocks on the chamber’s voting boards struck midnight, and Busch’s gavel hammered home for the last time in 2010.

“”I wish you all a safe and happy interim, and I hope to see you all next year,” he said.

The House of Delegates on Friday passed legislation that will bar drivers in Maryland from using hand-held cell phones.

The bill, which was already passed in the same form by the Senate, now heads to Gov. Martin O’Malley’s desk for his signature. It would make talking on a hand-held cell phone a secondary offense, meaning it would have to accompany a more serious offense in order to be enforced. It would carry a $40 fine on the first offense, and $100 on the second.

“Three of 10 crashes in our state and every state come as a result of distracted driving and all of those come with a cost,” said Del. Bill Bronrott, D-Montgomery.

Bronrott, coincidentally, announced his upcoming retirement from the General Assembly yesterday to take a new job in Washington, as deputy administrator of the Federal Motor Carrier Safety Administration.

The House voted 125-14 on the measure, which squeaked through the Senate last month, 24-23.

The bill faced a series of eight amendments Friday, all of them offered by Del. Michael D. Smiegel, R-Upper Shore, and all of them defeated.

Smiegel’s proposals ranged from allowing state snow plow drivers to use their phones, to diluting the bill to a public awareness campaign on the dangers of distracted driving.

He called the bill “overreaching and unnecessary.”

“They do all kinds of crazy things in a car,” Smiegel said after recounting a story about passing a driver who was eating a crab while behind the wheel. “We’re not outlawing all that.”

But the bill’s supporters, who hailed from both parties, applauded the ban as an important safety measure as cell phones grow more complex with more features to tempt their owners.

“We all know people are multitasking. They’re not just making phone calls. They’re multitasking as they drive down the road and our kids are doing it, too,” said Del. Maggie McIntosh, D-Baltimore City.

The bill that would help small, local banks win more state banking contracts is still alive in these waning days of the legislative session, but time is running short.

Del. Bill Frick, the bill’s sponsor, said Thursday the focus of the bill is still the same, but its mechanics had changed. Originally, HB 1325 would have given local banks a pricing preference when bidding on state contracts. Now, Frick said, it would require the treasurer to consider whether a bank is local bank when reviewing bids.

“The goal for me was to move the business off Wall Street and into local banks,” said Frick, D-Montgomery. “Bank of America is going to invest their money in Dubai. Sandy Spring Bank is going to invest their money in Maryland.”

Del. Dan Morhaim, D-Baltimore County, said the bill is still being worked on by his subcommittee and is in much better shape that it was when originally submitted. But Morhaim wouldn’t hazard a guess regarding the bill’s prospects.

The legislature wraps up its 90-day session on Monday and for Frick’s bill to pass, it would have to come before the House of Delegates twice and the Senate three times — and survive committee votes in both chambers.

After watching the legislature trim the guaranteed funds for the Heritage Structure Rehabilitation Tax Credit, Gov. Martin O’Malley is pressing for the funding to the popular program to be doubled.

The governor included an extra $5 million appropriation for the program in his supplemental budget, which will face the scalpel-wielding budget conference committee this week.

O’Malley had sought $50 million over three years – $20 million in fiscal 2011 and $15 million each in the two following years.

But, lawmakers opted instead for a $5 million appropriation in 2011, a plan the Senate and House of Delegates appear to agree on. The credit would be back up for annual appropriation from the governor and subject to cuts from the General Assembly.