- The Washington Times - Friday, March 28, 2003

Maryland senators will try to force the House to take a look at legalizing slot-machine gambling at horse-racing tracks even as they begin a struggle to reconcile their differences about three budget bills set for debate today.
The Senate Budget and Taxation Committee yesterday offered 22 amendments to the House Budget Reconciliation and Financing Act, including clauses to make the revenue bill contingent on legalizing slot-machine gambling and also to strike most of the new corporate taxes approved by the House.
A vote on the bill could come as early as today, with 10 days left in the legislative session.
Senate President Thomas V. Mike Miller Jr. yesterday postponed discussions on this and other budget bills because, he said, senators needed time to take in the amendments as many as 146 have been offered to the House budget bill, which could also be discussed today.
Mr. Miller, Prince George's County Democrat, has been the strongest supporter of Gov. Robert L. Ehrlich Jr.'s bid to legalize slots and reap state revenue of about $700 million a year that would be earmarked for the public school system. By tying slots to the revenue bill, the Senate forces a slots debate in the conference committee.
Mr. Ehrlich's slots bill remains mired in the House Ways and Means Committee, and putting up the Senate's slots bill, which passed by a 25-21 vote last week, appears to be the administration's last hope of winning the slots battle with the House Democratic leadership.
Sen. George W. Della Jr., Baltimore Democrat, today is expected to force a separate vote on the slots amendment. The move would test the chamber's resolve on the issue and Mr. Miller's ability to keep the votes in line.
The governor was "pleased to see progress" on the slots front, said Ehrlich spokesman Henry Fawell. "This is one step in a very long process to reach a compromise," he said.
The Senate slots plan is nearly identical to the governor's in that 10,500 slot machines are divided evenly among Laurel, Pimlico and Rosecroft racetracks. But the Senate cut the share of revenue going to the tracks from the 43.6 percent offered by Mr. Ehrlich to 39 percent. The move increased the share of slots dollars earmarked for education from Mr. Ehrlich's 42.1 percent to 46 percent.
The governor has said the tracks need more than 39 percent or else they might opt not to build the multimillion-dollar slots casinos. The final split of the gambling revenue and whether slots will be legalized and included in the budget is expected to dominate negotiations when the Republican governor and Democratic leadership of the General Assembly meet in the conference committee.
Meanwhile, the Senate version of the revenue bill includes most of the governor's proposals for more than $700 million in fund transfers and all of his $43.3 million in tax-compliance measures that expand the comptroller's authority to collect back taxes. It also contained Mr. Ehrlich's nickel increase to the property-tax rate, which will raise $165 million.
Making his presentation on the bill, Budget and Taxation Committee Chairman Ulysses Currie, Prince George's County Democrat, said there were "no easy answers, no quick fixes" to a budget complicated by a $2 billion shortfall.
The committee, he said, had tried to fix the shortfall by eliminating 1,800 vacant jobs and taking money from the transportation trust fund, as recommended by the governor.
A separate House tax bill was gutted by the Senate committee, with most of the tax measures eliminated or reduced and folded into the revenue bill. The tax bill now raises the tax on all tobacco products except cigarettes from 15 percent to 45 percent and makes health maintenance organizations and managed care organizations that serve Medicaid patients pay the 2 percent tax premium that other insurance companies pay.
But a Senate committee later pared down a $225 million increase in revenue through new corporate taxes and closed tax shelters. Instead, it proposed collecting an additional $47.4 million from increased corporate filing fees from $100 to $250 and expanding the yearly fee to include most incorporated businesses.
The fee increases in the House bill ranged from $250 to $20,000.
The committee also proposed a one-time 10 percent surcharge on corporate income tax to generate $33.4 million.
The taxes on HMOs and tobacco products are drawing fire from some Republican senators.
Senate Minority Leader J. Lowell Stoltzfus, a member of the Budget and Taxation Committee, said yesterday that he was against the taxes.
Mr. Stoltzfus, Somerset County Republican, was on the team that drafted the administration's budget bill and helped negotiate an increase in corporate filing fees and a corporate income tax surcharge. "We killed them and now take [the tobacco tax and the HMO tax] instead," he said.
Mr. Stoltzfus also said there was a strong chance that the General Assembly would have to now confront a budget bill that includes slots and tax increases something many Republicans have sworn they will oppose.
"They have painted themselves into a corner," he said about those Republicans. "We have to work together on the challenges we have," he said, pointing out that two of the three leaders in Annapolis Mr. Miller and Mr. Ehrlich are in favor of slots
House Speaker Michael E. Busch staunchly opposes slot machines, however, and Mr. Miller said the two men needed to reach a compromise, given the fact that there are only 10 days left before the end of session.
"This has gotten to be a battle between a Democratic speaker and a Republican governor. … They have to find common ground and compromise," he said.

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