- The Washington Times - Wednesday, January 11, 2012

ANNAPOLIS Gov. Martin O'Malley surprised Maryland lawmakers Wednesday by suggesting an increase in the state sales tax, jump-starting the 2012 General Assembly on what was expected to be a largely ceremonial first day.

Mr. O'Malley suggested increasing the tax from 6 percent to 7 percent as an alternative to a 15-cent increase in the gas tax that has been widely discussed by legislators but poorly received by many residents.

Democratic leaders have said they are likely to raise taxes this session to help pay for roads, schools and other infrastructure projects. Lawmakers last raised the sales tax during the 2007 special session, when Mr. O'Malley led an effort to increase it from 5 percent to 6 percent.

“No one in our state lost a house, lost a job or lost a business because of the additional penny on the sales tax,” the governor said. “These bridges don’t build themselves. … If we want to build a better country for our kids, that’s how we have to do it.”

The Democrat-controlled General Assembly otherwise opened with smiles, laughs and handshakes, giving lawmakers a day of calm in a 90-day session expected to be filled with debates about tax increases and same-sex marriage, among other issues.

The House and Senate each convened for an hour with speeches to appoint party leaders and welcome federal, state and local elected officials who had come to watch the ceremonies. Among them were Republican Andy Harris and Democrat Chris Van Hollen, former state senators who now serve in the U.S. House of Representatives.

The unanimous reappointment of Delegate Michael E. Busch, Anne Arundel Democrat, as House speaker for a 10th General Assembly session distinguished him as the Maryland lawmaker serving the longest in that post.

Though legislators posed for pictures with family members and mingled with colleagues, they acknowledged tough work ahead with gay marriage legislation, environmental initiatives and potential tax hikes to help balance the budget and trim a $1.1 billion structural deficit.

“We’re going to have a very productive session,” said Senate President Thomas V. Mike Miller Jr., Prince George’s Democrat. “The governor is going to have a very ambitious agenda and we’ve got to move it forward as best as possible.”

Mr. O'Malley greeted House and Senate members and afterward outlined the many initiatives he will push this session - including the marriage legislation, offshore wind energy and increased capital spending to be financed by tax increases.

Nearly 100 people with the group Wind Works for Maryland held a rally outside the State House to seek support for Mr. O'Malley’s offshore-wind initiative. Members wearing blue T-shirts said they were confident about getting enough assembly votes this year after failing in 2011.

The governor also introduced a legislative map - one substantially similar to the map proposed last month by his advisory committee - that the assembly will consider in the early days of the session.

The governor is expected to throw his support behind increasing the state’s 23 1/2-cents-a-gallon gas tax and $30-a-year “flush tax,” but unexpectedly floated a sales-tax increase during a morning radio interview and while speaking later with reporters.

The governor said increasing the sales tax would bring the state hundreds of millions of dollars in revenue, and could be a viable option if the assembly struggles to raise the gas tax, which has gone unchanged since 1992.

The General Assembly is expected to consider raising the tax by 15 cents a gallon by using 5-cent increases in three consecutive years, to help fund road and transit projects.

Democratic lawmakers have expressed increasing confidence in recent weeks that they will successfully raise the gas tax, despite cries that it could disproportionately affect poorer residents who have long commutes or older, less fuel-efficient vehicles.

Mr. Miller, who has said publicly that he expects to pass an increase, said the assembly almost certainly will leave the sales tax untouched.

Mr. O’Malley, who appears to have national political aspirations and must retire as governor in 2014 because of term limits, said he has not seen “much political will” for a gas-tax increase and called a sales-tax increase just “another idea.”

Whatever method they choose, Democrats have acknowledged they almost certainly will raise taxes this year to improve public infrastructure and create jobs, many of which would be in construction-related fields.

“There are some challenges facing us this year,” said Mr. Busch. “We face an economy that is still moving out of the recession.”

While Democrats make up nearly three-fourths of the General Assembly, they will receive significant resistance from Republicans, who have called for major spending cuts and discouraged any tax increases while the economy remains sluggish.

House Minority Leader Anthony J. O’Donnell, Calvert Republican, argued that the state’s “tax-and-spend” leadership is placing a greater economic burden on residents and forcing many businesses out of Maryland.

“We’ll look for opportunities to work together where we can,” said Mr. O’Donnell, who was elected unanimously this week to lead the GOP House caucus for a sixth consecutive year. “But our first order of business is to make sure that these folks - in their zeal to say they’re doing something - aren’t doing any more damage.”

GOP lawmakers are expected to start a fight against what some have called the state’s “war on rural Maryland.” Republicans have argued that many of the state’s recent initiatives - including toll hikes, a statewide planning policy aimed at reducing sprawl and potential environmental restrictions and tax increases - are designed to stifle economic growth in rural, conservative areas and funnel money and power into urban regions with more Democrats.

Mr. Miller dismissed the notion Wednesday while speaking to Senate Democrats. He called for bipartisanship in the assembly and said the state is keeping all residents in mind as it is forced to make many difficult decisions.

“There’s not going to be any war on rural Maryland,” he said. “But at the same time, we need to recognize that we do need planned and orderly growth, we need to protect the Chesapeake Bay, we need to balance the budget and we need revenue.”