Senate President Thomas V. Mike Miller, the chairmen of the Senate’s four standing committees, and two other leaders signed an open letter yesterday warning that Ehrlich’s planned actions would protect “corporations that don’t pay their fair share” while “unraveling years of work to gain national respect” for Maryland’s university system.
Since the end of the General Assembly session last month, Ehrlich has pledged repeatedly to veto a bill that contains $135 million in so-called corporate loophole closings, temporarily higher corporate income taxes, and a 2 percent tax on health maintenance organization policies.
The veto is expected to come as early as tomorrow.
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The governor has said he will compensate for the revenue used to balance the $22.4 billion state budget through cuts to programs. He plans to cut up to $500 million in the next few weeks to get a head start on closing a $1 billion budget deficit projected for the fiscal year that begins July 1, 2004.
The university system alone could receive a $60 million hit.
“It disturbs us that he now intends to go around the General Assembly and unilaterally make budget cuts that will do lasting harm to our citizens,” the letter said. “There is another way. The governor should accept the balanced budget he proposed and helped to develop, and work with us to implement a long-term strategy when we convene in January 2004.”
Senators said that Ehrlich is favoring corporations and cutting programs at the same time the state portion of property tax bills is going up – “further burdening Maryland families,” the letter said.
Miller said in an interview that the governor should consider changing his mind about the tax bill because of recent news that revenue collections are coming in slower than expected. The state could end the 2003 fiscal year on June 30 with a deficit for the first time in a decade.
“Smart people assess changing circumstances in their decision-making,” Miller said. “Leaders do not remain static. He’s going to have to listen eventually. Maybe not now. The state cannot continue to hemorrhage. Sooner or later he has to stand up to his right-wing base.”
Henry Fawell, an Ehrlich spokesman, held out little hope that the governor would alter his thinking about higher corporate taxes. Deep cuts are needed now, Fawell said.
“We’re facing a $1 billion deficit. The situation is too dire to ignore. The governor does not feel that new taxes will make the situation any easier,” Fawell said. “If Marylanders wanted their taxes raised, he would not be governor today. Working families don’t want high taxes, and that doesn’t make them right-wingers.”
The senators’ letter appears to be just one phase in a mounting effort by Democrats and interest groups to sway public opinion on Ehrlich’s pending veto and budget cuts.
Progressive Maryland, a coalition of religious groups and workers advocates, is organizing a State House protest tomorrow to urge higher corporate taxes and loophole closings, and to challenge the budget cuts.