Fraser provides some big-picture perspective on both events and recalls the last day the General Assembly made so much historic news in one day. (Hint: It was in 1984.)

We also look at Gov. Martin O’Malley’s role in the gay marriage bill and how involved he might be in legislation throughout the rest of the session. Enjoy.

But do not despair, residents of the Free State. We have a sideshow of our very own, which is taking shape daily in Annapolis. It’s about the 2016 presidential race and Gov. Martin O’Malley’s apparent ambitions in that regard.

For some time now, the governor’s attempts to burnish his national profile while serving as head of the Democratic Governors Association have been the topic of conversations over coffee and cocktails in state political circles.

A popular pastime has been speculating what cabinet post the governor might go for — Homeland Security seems to rank high among the speculators – if President Obama wins a second term.

But now that speculation is spilling into public view, often accompanied by barbed rhetoric.

After Comptroller Peter Franchot assailed O’Malley’s proposal to raises taxes on gasoline as “an absolute punch to the gut of the middle class,” the governor responded by calling fellow Democrat Franchot “kind of our version of Mitt Romney.”

Franchot retorted, ”I’m sorry if I’m getting in the way of his presidential efforts, but I’m doing my job as comptroller.” (Interesting words from a man who is presumed to be running his own campaign for governor of Maryland.)

O’Malley was also pummeled with the p-word when he testified before two House committees in favor of his same-sex marriage bill, a popular issue with Democrats nationally.

The Washington Post reported that Del. Emmett C. Burns Jr., D-Baltimore County, a leading opponent of the bill, “suggested that O’Malley must want to match New York Gov. Andrew Cuomo, a fellow Democrat who helped pass a same-sex marriage bill last year and who, like O’Malley, has been talked about for national office in 2016.”

“I would love to see our governor as president of the United States, but not on the backs of his own people,” Burns said. Ouch.

So there you have it — presidential politics, Maryland style. And it’s just beginning.

We also take a look at what punishment Sen. Ulysses Currie could face from a legislative ethics panel and what it might mean for business as usual in Annapolis. And we get into why Smith thinks the “tone” of this legislative session is different than in years’ past.

(And when I say “we,” I really mean “Fraser Smith.” Few people can offer perspective on Annapolis the way he can.)

Emails went flying out to the media last Friday. First came word that 30 religious leaders from Prince George’s County would deliver letters Monday supporting the bill to P.G. delegates and senators on the committees that will handle the legislation.

Then we heard that on Tuesday, about two dozen Maryland health professionals – wearing lab coats and scrubs no less — would join business leaders Tuesday morning on Lawyer’s Mall near the State House to express their support for the bill, which they claim would save more than 400 lives and nearly $2.5 billion in health costs while creating more than 1,000 jobs.

And at 1:30 p.m. Tuesday, Gov. Martin O’Malley himself will testify in favor of the bill before the Senate Finance Committee.

And so, the legislative theater season is in full swing. Sit back and enjoy the show.

Sen. Richard S. Madaleno Jr. introduced The Tax Credit Evaluation Act on Tuesday. And Del. Bill Frick, the architect behind the effort, said he’ll drop twin legislation in the House of Delegates as soon as Wednesday.

The bills would require General Assembly committees to review a handful of tax credits every five years to determine if the state should continue to offer them.

The reviews would look at the intent of the tax credits, whether they are actually meeting those goals and whether the tax revenue lost the state is worth it.

“We have to find a way to systematically review our tax credits. You put things in to address a specific need or policy goal and they stay on the books forever, said Madaleno. “We should have some way to periodically review all of these programs to see if they’re serving their intended purpose, and to see if they’re still affordable or worthwhile.”

Madaleno, who serves on the Senate Budget and Taxation Committee, said that lawmakers deal regularly with some tax breaks that are funded through the state’s budget.

“But, he said, “some of them just float off, on their own, and you never really know who’s accessing them, how much and what the benefit is.”

The Daily Record examined the issue in December.

Maryland has 341 tax breaks woven into its tax code, but doesn’t examine the benefits of nearly all of them. And in 157 cases, the state isn’t even sure how much the tax breaks cost in terms of lost tax revenue.

Business groups fought against Frick’s effort last year, arguing the provision that would put expiration dates on credits — lawmakers could reauthorize them — would create too much uncertainty for the companies that rely on them. The bill passed the House but died in the Senate budget committee in the waning hours of the legislative session.

Lawmakers are already tackling the same-sex marriage issue and are waiting to see Gov. Martin O’Malley’’s gas tax proposal. They know he will call for the 6 percent sales tax to be applied to gasoline, but a key piece of the legislation remains unknown — how O’Malley wants to protect the Transportation Trust Fund from budget-balancing raids. Ethics reform and gambling are also on the docket this week. Listen up.

Gov. Martin O’Malley’s administration is backing legislation to firm up more aspects of the exchange mandated by President Barack Obama’s Affordable Care Act. Determining the way the state will pay for the exchange, however, will wait until next year, the officials said.

Rebecca Pearce, executive director of the Maryland Health Benefit Exchange, said initial estimates indicate the exchange would cost $30 to $40 million to run in the first year and between $45 million and $60 million in the second.

The exchange’s board of trustees recommended the state examine both “broad-based” health industry fees and transaction-based “user fees” to pay for the exchange.

Maryland officials expect to receive federal dollars to run the exchange in 2014. The system must be self-sustaining in 2015.

“A broad-based assessment on the health care world would be very small compared to to the benefit of the exchange,” Health and Mental Hygiene Secretary Joshua M. Sharfstein told the Senate Finance Committee.

Sharfstein said the state expects the federal health care law that mandated states set up exchanges would provide about $500 million per year in subsidies to subsidize insurance for low-income Marylanders.

Senate Minority Leader E.J. Pipkin, R-Upper Shore, said he worried the bump in the number people with health insurance would cause prices to spike for everybody.

“One of the basic rules of economics is that if you increase the demand but don’t increase supply, prices are going to go up,” he said. “This is a lot of people to add to the system at once. It looks like we’re on a collision course, off the drawing board and into the real world.”

Sharfstein agreed, but said the law includes provisions including higher Medicaid reimbursement rates to attract new doctors and health care providers.

“The immediate way to lower [health care] costs is to get more people insured and reduce the amount of uncompensated care,” said Sharfstein.

Some 730,000 people in Maryland are uninsured, according to Pearce. That represents about 13 percent of the state’s population.

Last year, lawmakers decided the exchange would be a public corporation and an independent unit of state government, an issue watched closely by businesses interests worried that control would be buried in a sluggish state bureaucracy.

The exchange will revisit that issue in 2016 to determine if it should transition away from state government and become a nonprofit.

This year, the administration’s legislation would define the role of “navigators” that would assist consumers shopping for health care coverage. The bills also call for the exchange to split up the individual and small group markets.

Pearce said the exchange will apply for a federal grant by June to pay for a marketing effort to bring individual and small business customers to the exchange.

The state, however, is operating on a playing field cratered with uncertainty.

Republican presidential hopefuls have vowed to overturn Obama’s signature social legislation, the Supreme Court will hear arguments on the constitutionality of parts of the law in March and the GOP-held House of Representatives is unlikely to approve funding for the law.

“To me, it wouldn’t make a whole lot of sense to get this [marketing] grant, develop a plan and roll it out before the November election,” said Finance Committee Chairman Thomas M. “Mac” Middleton, D-Charles. “Things could be a lot different then.”

Pearce said the marketing effort would take shape closer to the open enrollment date in October 2013.

“It’s hard to plan in advance for a lot of different contingencies,” said Sharfstein. “We have a lot of confidence the law will be upheld. We’re trying to be where we need to be, but not further.”

Throughout the day, administration officials revealed through email blasts — every half hour, starting at noon — and posts on the governor’s blog “projects that could be impacted” in all 24 local jurisdictions.

They also mounted posters showing schematics, renderings and photos of the projects between the galleries above the Senate and House of Delegates, in the hallway through which dignitaries will travel on their way to Wednesday’s State of the State address.

The projects include the Red Line in Baltimore City, development around the Martin State MARC station in Baltimore County, widening Route 32 in Carroll, a MARC line extension through Cecil and improvements to an intersection in Anne Arundel.

The promise of funding for local projects will likely be key to winning votes for O’Malley’s proposal.

For the last two years, House Speaker Michael E. Busch, D-Anne Arundel, said the support of local political leaders in vote-rich Howard, Montgomery and Prince George’s counties and Baltimore City will be critical.

“If you believe they’re going to vote for it and not expect to get projects, you still believe in Santa Claus,” the speaker told a Maryland Economic Development Association conference earlier this month. “That’s the way it works.”

Senate President Mike Miller said Tuesday the sales tax on gasoline will be “a tough sell.”

The proposal would phase in over three years, adding about 6 cents to a gallon of gas a year, based on Tuesday’s statewide average of $3.50.

“I told him (the governor) it would be a full-time effort between now and April to get his agenda passed,” said Miller.

“He’s going to have to meet with the delegations and explain why this is the best solution and why we need to move forward,” Miller said. “It’s his proposal, he’s the governor of the state and he needs to make his case to the elected officials. He’s not going to be able to convince the electorate why it’s the best thing for them. But it’s the responsibility of elected leaders to lead.”

***

More Miller on the gas tax:

“It’s going to be a tough sell, no matter what. The public says they can’t afford it and would rather do without it, but there’s never a good time. There’s always going to be another storm in the Gulf. There’s always going to be another war in the Middle East. There’s always going to be a presidential veto of a Keystone Pipeline.”

“We’ve got a Red Line and a Purple Line that need to be built, two major beltways that need repairs. We need revenues in the Transportation Trust Fund sooner rather than later. The sooner the members of the Senate and the House of Delegates realize they’re going to have to spend some political capital to make that happen, the better off we’ll be.”

The Senate president also said the state needs to expand the sales tax further to include services. That idea has rankled business interests in Annapolis, who worry such an expansion would raise the cost of many business-to-business transactions.

“We’ve already maxed out in terms of the rate,” Miller said. “We need expand the sales tax. We’re 37th out of 50 states in terms of usage of the sales tax. In the future, we need to make it apply to services rather than heighten the rate.”

This week, Nick and I talk about Gov. Martin O’Malley’s gas tax proposal and how his legislative agenda might fare in this year’s session. We also preview O’Malley’s State of the State address — will he be talking to Marylanders while also advancing a national platform? — and Nick’s upcoming story from his interview with Lt. Gov. Anthony Brown.



“When someone who owns a farm passes, so often the farm is lost to congestion, to sprawl,” said Senate President Thomas V. Mike Miller Jr., D-Calvert and Prince George’s.

The Senate’s bill will exempt up to $5 million in agricultural property passed to a “qualified recipient” who will use the property for farming purposes.

If the property is sold and not used as a farm within a decade, the estate tax would then have to be repaid.

Senators said too often, family members who inherit farms are forced to sell off pieces of their land to pay the estate tax bill.

“I hear this from a number in the industry, that they’re land rich but cash poor,” said Senate Majority Leader Rob Garagiola, D-Montgomery.

Garagiola, who is running for the 6th Congressional District seat in Western Maryland, was joined in promoting the bill by Sen. David R. Brinkley, a Republican who has also thrown his hat into that race.

“The best farm preservation tool we have is anything that makes farming profitable,” said Brinkley, R-Carroll and Frederick.

Gov. Martin O’Malley, a Democrat, has said he will propose a similar measure to defer estate taxes on family farms until they are subdivided or developed.

The bill was not part of the legislative agenda the governor rolled out on Monday, but his administration has said it will be coming soon.