ANNAPOLIS — Gov. Martin O’Malley’s top staffers pitched the governor’s $1.4 billion tax plan passed during the recent special General Assembly session as a political effort akin to the one former Virginia Gov. Mark Warner passed in 2004, which elevated him to national political prominence.
Mr. Warner was hailed in national Democratic circles for doing the near-impossible: increasing taxes and improving his approval rating.
But after Maryland’s special session closed in November, Mr. O’Malley’s public-approval rating dropped — not the outcome called for in the Warner playbook.
An analysis by The Washington Times and interviews with key Virginia leaders shows Mr. O’Malley, a Democrat, followed a more abbreviated version of the Warner plan, and suffered politically as a result.
“Warner left office very, very popular, despite having raised a lot of money for the state,” said Robert D. Holsworth, a political scientist at Virginia Commonwealth University, which polled Mr. Warner’s public approval frequently while he was governor.
“I think O’Malley was hoping he’d get much the same response, and he got a very different one,” he said.
The key to Mr. Warner’s success, say his former staffers, was a three-fold political strategy: make serious budget cuts before going to the taxpayers for more money; after developing the tax plan open the governor to questions from the public at Town Hall meetings across the state; and after raising the taxes, show the return for the taxpayers in improved services.
“It was an unrelenting, eye-on-the-ball communications effort, all four years, to make sure an overall tax increase wasn’t a bad thing, but that Virginians saw it was getting the government they deserved without having that big a hit on their pocketbooks,” said Ellen Qualls, Mr. Warner’s former press secretary.
During his first two years in office, while the state faced a long-term, $6 billion budget shortfall, Mr. Warner froze salaries for state workers, shut down state-run liquor stores and closed the state’s Department of Motor Vehicles one day a week.
After he developed his tax plan — which included a restructuring of the personal income tax, the sales tax, and an increase in real estate taxes — Mr. Warner held at least 50 “Town-Hall” style meetings across Virginia.
After the Virginia General Assembly approved $1.4 billion in new taxes in 2004, the Warner administration then began selling the results — including increased education spending and saving the coveted AAA bond rating with national credit agencies.
The protracted communications strategy paid off, Miss Qualls said. Virginians would come up to Mr. Warner at the Town Hall meetings and ask him about seemingly arcane budget topics, even thanking him for maintaining the state’s strong credit rating.
Last summer, Mr. O’Malley met with Mr. Warner for lunch. The two talked about the budget, and Mr. O’Malley brought some Warner strategies back with him, including a slide-show presentation similar to the one Mr. Warner showed to residents during his budget tour.
Mr. O’Malley said a majority of Marylanders would see a net reduction in their tax bills. He travelled the state through the start of last fall, introducing parts of his tax plan and attempting to educate taxpayers about the causes of the state’s long-term budget shortfall.
Unlike Mr. Warner, though, he chose to increase taxes just one year into his term and spent a comparatively six short weeks delivering his plan to the Marylanders. Mr. O’Malley then called lawmakers back to Annapolis during an emergency session of the General Assembly.
Weeks after state lawmakers approved the tax increases and the session ended in late November, three polls showed Mr. O’Malley’s public approval had dropped.
A poll by Gonzales Research &. Marketing Strategies this month found his performance approval at 36 percent, compared to 52 percent after he took office in January 2007. The two other polls showed approval rating of 33 percent and 39 percent.
Mr. Warner’s job-approval rating slipped from 60 percent in 2002 to 55 percent in April 2004, shortly before he signed the new taxes into law. But by September 2004 his support had climbed back to 58 percent, and by the time he left office in October 2005 his approval rating was at 80 percent.
Mr. O’Malley, who is starting the second year of his four-year term, decline to answer questions directly last week on whether he built enough public support for new taxes.
“Oh golly, I’m not doing pundit questions,” he said. “You’ve got to call people who are smarter than me for pundit questions.”
Senate President Thomas V. Mike Miller Jr., who counseled Mr. O’Malley to fix the state’s budget woes sooner than later, frequently said last year that Marylanders should feel the pain of sizable budget cuts before being presented with new taxes.
But Mr. O’Malley elected to draw more than $1 billion from the state’s savings accounts, rather than cutting spending to the bone.
“It would have helped him politically to do that, that’s what Mark Warner was able build momentum in Virginia with,” said Mr. Miller, Southern Maryland Democrat. “The governor didn’t want to do that. He’d been through pain in Baltimore City — he didn’t want pain spread around the state — he just wanted people to keep the state moving forward. He was willing to sacrifice his political capital to make progress occur.”
Mr. O’Malley’s communications strategy was hampered by former Gov. Robert L. Ehrlich Jr.’s insistence throughout the 2006 campaign that the state had a budget surplus, not a deficit — something that many Marylanders continue repeating.
Despite that continuing obstacle, Mr. O’Malley did a strong job making his case to the taxpayers, said spokesman Rick Abbruzzese.
“I think that leading up to the special session we were successful in laying out the options for the public,” he said.
Mr. O’Malley and Mr. Warner both used the slideshow presentations on tours across their respective states, designed to educated taxpayers about the state budget and why they were facing a budget shortfall.
Both men also pitched their tax plan as a net benefit for the majority of taxpayers.
Mr. Warner said 65 percent of Virginians would save on their taxes. And working with Virginia tax collectors, he developed an online tax calculator taxpayers could use to determine their net taxes under the plan.
Mr. O’Malley said his original plan would save money for 83.5 percent of Marylanders, though that calculation excluded his proposals to increase the gas and cigarette taxes, as well as business taxes.
In Maryland, the net effect of the new taxes is still unclear.
Mr. Warner also defused traditional opponents of increased taxes: Republicans and business leaders, and even had the two groups out stumping for his plan, said Jim Dyke, a member of Mr. Warner’s “Kitchen Cabinet” of community and business advisers.
Mr. Warner, a former telecommunications executive, was able to turn that political support into public support, Mr. Dyke said.
“Once that message started to resonate it started to create the groundswell — the citizen’s themselves were saying ’Look we understand that we’re going to have to do things differently,’ ” he said.
However, Maryland business groups are now leading the charge to repeal the computer services tax increase, which was included in the plan Mr. O’Malley signed into law. And Maryland Republicans said they were shut out of O’Malley administration meetings before the taxes were introduced.
House Minority Leader Anthony J. O’Donnell, Southern Maryland Republican, said Mr. O’Malley’s performance is more reminiscent of former New Jersey Gov. Jim Florio.
Mr. Florio, a Democrat, became one of the most abhorred politicians in New Jersey after he increased taxes at the start of his term. He ultimately lost the governorship to Republican Christine Todd Whitman, and Democrats lost both the New Jersey House and Senate in the same election.
“This is state politics 101, which [the O’Malley] administration seems to have missed,” Mr. O’Donnell said.
By contrast, Virginia Republicans in the Senate helped Mr. Warner push his plan through in 2004. Though his main opposition came from anti-tax Republicans in the House, who stalled work during the 2004 legislative session to block tax increases.
Virginia House Republicans proposed returning to their home districts to ask their constituents, but by that point Mr. Warner and his supporters had built a strong network of tax supporters who packed the meetings.
“When the Republicans in the House refused to pass it, they thought there was going to be this huge anti-tax rebellion,” Mr. Hoslworth said. “There was an enormous amount of political spadework that Warner did to get interest groups supportive. They dominated the public hearings.”
A Virginia Commonwealth University poll conducted during the 2004 legislative session, when Mr. Warner and Virginia lawmakers raised taxes $1.38 billion, showed a slim plurality of voters — 48 percent — wanted new taxes.
“He only did this after he tried every cut,” said a former Warner administration official. “It gave him the kind of credibility he needed.”
Mr. Warner was frequently mentioned as a strong choice for Democrats to run for president this year, before he announced he would not run.
He instead has funneled his political capital into a U.S. Senate campaign in Virginia.
Mr. O’Malley’s future on the national stage is likely to hinge on whether Marylanders believe they got a good deal. Something he still has three years left to prove.
“The test for Maryland tax reform will be: Is the state in a better place a year or two from now, and can they prove that to the people?” Miss Qualls said.
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