Rising gas prices start to sink O’Malley’s tax hike

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ANNAPOLIS Gov. Martin O'Malley’s proposal to increase the state’s gasoline tax is looking more and more far-fetched because of rising gas prices and persistent public outcry, say state lawmakers from both parties.

The Democratic governor’s bill to phase in a 6 percent sales tax on gas has been met with skepticism from Republicans and moderate Democrats in the General Assembly.

Now with gas prices climbing toward $4 a gallon and lawmakers focused on fine-tuning a state budget that could include several other tax increases, some legislators say they are running low on time and political will to tack on a gas tax hike.

“I think it’ll be near impossible,” state Sen. James E. DeGrange Sr., Anne Arundel Democrat, said Thursday. “At this point, I don’t see it having any energy to move forward. With the economy the way it is and gas prices booming, people are outraged.”

Since last year, the governor and leaders in the Democrat-controlled General Assembly have called for an increase in the state’s 23.5-cents-a-gallon excise gas tax, which funds road and transit infrastructure and has not been raised since 1992.

Mr. O'Malley proposed his bill last month that would apply a 2 percent sales tax this year on wholesale gas purchases, then tack on an extra 2 percentage points in each of the next two years.

The proposal eventually could add more than 20 cents to the cost of a gallon of gas.

Supporters argue that a tax increase is necessary to boost lagging transportation revenue and pay for needed road and transit improvements in the state. Mr. O'Malley said a 6 percent sales tax would raise $613 million a year and create 7,500 jobs related to construction and other projects.

“Nothing has been taken off the table,” said O'Malley spokeswoman Takirra Winfield. “The governor feels like this is something that we need to do now so that our children won’t have to face the cost of our inaction.”

Critics contend that raising the tax will overburden taxpayers already frustrated by unpredictable gas prices. Polls have consistently shown that a majority of Marylanders oppose the tax.

Maryland gas prices rose by about 20 cents last month, according to AAA. An average gallon of regular gas now costs $3.70.

Delegate Andrew A. Serafini said many rural constituents have long commutes and little access to public transit, which would cause them to be disproportionately hurt by the tax.

Mr. Serafini, Washington Republican, said the state instead should try to ensure that its existing transportation funding is spent on transportation.

In recent years, lawmakers have borrowed hundreds of millions of dollars from the Transportation Trust Fund for non-transportation expenses.

Mr. O'Malley’s bill would require repayment of borrowed funds. Mr. Serafini said the state needs to get into the habit of managing money more responsibly.

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