Thursday, May 19, 2005

PRINCESS ANNE, Md. — Gov. Robert L. Ehrlich Jr. vetoed a bill yesterday that would have forced Wal-Mart to pay a mandatory amount of employee health insurance or potentially cancel plans for a distribution center with 1,000 jobs.

“The reason I am going to veto this bill is it threatens the economic health of this terrific county,” the Republican governor told about 200 people in Somerset County, which has the state’s second-highest unemployment rate at 7 percent. “This is a tax bill disguised as a health bill, and everyone understands that.”

The so-called Wal-Mart bill, officially titled the Fair Share Health Care Fund Act, would have forced the company to either spend at least 8 percent of its payroll on employee health care benefits, contribute an equivalent amount to the state’s Medicaid fund or pay a $250,000 fine.

The legislation is being watched by lawmakers in other states aiming to crack down on Wal-Mart Stores Inc. Similar bills have already been proposed in New Jersey and Pennsylvania.

In Maryland, the bill and the veto likely will remain a key political issue through next year’s elections, with Republicans portraying the bill as anti-business and Democrats saying the veto was anti-worker. State lawmakers could override the veto when they return to Annapolis in January.

Wal-Mart, the nation’s largest retailer, is also considering a distribution center in Western Maryland.

The law would have applied to any company with more than 10,000 workers, but Wal-Mart is now the only one in Maryland that meets the criteria. The state’s other large companies, such as Northrop Grumman, already provide benefits that comply with the law.

Supporters say the law would have protected employees of large corporations.

“They are pretty ruthless,” said Chris Kofinis, a spokesman for the United Food and Commercial Workers. He also said Wal-Mart had “nothing to brag about” in being the only large company without adequate benefits to comply with the bill.

Donna S. Edwards, secretary and treasurer of the Maryland and D.C. AFL-CIO, was among about two dozen union protesters at the event. She said Wal-Mart has a “moral obligation” to pay more of its employees health care premiums.

“Wal-Mart makes $20,000 a minute and their employees don’t make $20,000 a year,” she said. “They should have to pay their employees health care.”

Some protesters complained that town police stopped them from carrying placards and threatened them with arrest if they booed the governor.

Police Chief Russell M. Pecoraro said he barred signs, including pro-Ehrlich signs, from the event and only discouraged the protesters from using profane language in public, a violation of state law.

The governor and other opponents of the legislation say the health-insurance mandate would drive companies and jobs out of the state, and the requirement could soon be imposed on smaller businesses.

“Without employers there is no employees,” said Mr. Ehrlich. “There’s no health care, there’s no wages, there’s no American dream. This bill sends a very wrong message to Maryland, the country and the world.”

Eduardo Castro-Wright, Wal-Mart’s executive vice president and chief operating officer, attended the ceremony and applauded the governor’s pro-business stance.

“By vetoing this bill, Governor Ehrlich has drawn a line in the sand in support of jobs and economic growth, and we thank him so much for that,” he said. “This type of legislation fails to provide health insurance to anyone and does not take people off America’s uninsured list. … It is nothing more than an assault on a business trying to create 100,000 new jobs just this year.”

Senate Minority Leader J. Lowell Stoltzfus, a Republican whose Eastern Shore district includes Somerset County, said his party could enlist enough Democrats to defeat an override.

“The pressure is on — big time,” he said, stressing the fact that every member of the General Assembly is up for re-election next year.

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