- The Washington Times - Wednesday, April 6, 2005

ANNAPOLIS — Gov. Robert L. Ehrlich Jr. yesterday vowed to veto legislation that would force Wal-Mart to spend at least 8 percent of its payroll on employee health care benefits.

“This is a grave precedent,” Mr. Ehrlich, a Republican, said of the bill in a brief interview with The Washington Times. “Every business in Maryland should be up in arms.”

The governor likely would use the veto after the end of the legislative session, which is scheduled to adjourn Monday night. Wal-Mart, the nation’s largest retail chain, would get a reprieve at least until January, when the General Assembly would reconvene and attempt to override the veto.

The bill, titled the Fair Share Health Care Fund Act, passed by large enough margins in the Democratic-controlled House and Senate that an override appears certain.

The legislation would apply to any business with more than 10,000 employees. Wal-Mart currently is the only business in the state that meets the criteria.

The state’s other large companies, such as Northrop Grumman, already provide adequate health insurance benefits to comply with the law.

Under the bill, a company that chooses not to spend the required 8 percent on employee benefits could instead contribute an equivalent amount to the state Medicaid fund. Companies that do not meet the requirement would be subject to a $250,000 fine.

Supporters say the law will protect employees of large corporations.

The Ehrlich administration and other opponents characterize the measure as a new business tax that could drive large companies out of Maryland.

The legislation won final Senate approval Tuesday in a 30-16 vote, one vote more than the two-thirds majority needed to overturn a veto. The House last month passed the bill in a 84-50 vote — one vote shy of a veto-proof majority.

House Democratic leaders say they have another enough support to override a veto from delegates who were absent from last month’s floor vote.

The votes in both chambers fell largely along party lines.

Delegate Salima S. Marriott, Baltimore Democrat, said the General Assembly had once before succeeded in mustering a veto override and would do it again to enact the Wal-Mart law.

“Businesses maximize their bottom line by referring employees for these [Medicaid] programs,” she said. “We’ve said, ‘Enough is enough.’”

Still, opponents hope the veto will stick.

“It is not safe to assume that the veto will be overridden. Things can happen,” said Ronald W. Wineholt, vice president of government affairs for the Maryland Chamber of Commerce.

Mr. Wineholt said the legislation would make Maryland the only state to impose a payroll tax on companies to provide health care.

He credited union lobbyists with persuading Maryland lawmakers to embrace the act and predicted that the bill, if enacted, would lead to similar mandates for all businesses.

“It’s easy to spend other people’s money and that’s what this bill does,” Mr. Wineholt said.

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