O'Malley's Budget Targets Maryland's Highest Earners
The governor's plan would result in smaller refund checks for two out of every 10 Maryland residents.
By Dave Nyczepir, Capital News Service
Gov. Martin O'Malley is proposing capping income tax deductions and rolling back income tax exemptions for Maryland's highest earners as part of his plan to close the $1-billion hole in the state's $14-billion operating budget.
O'Malley's plan, unveiled Wednesday morning, Jan. 18, would begin capping deductions for Marylanders making more than $100,000 and reduce exemptions for singles making more than $100,000 and couples making more than $150,000.
The exemptions would disappear for singles at $125,000 and couples at $175,000.
The governor said that only two out of every 10 Maryland residents would receive a smaller amount in their refund check as a result.
"In order to get us through this recession in advance of other states, and in order to protect the priorities of the people of our state and the futures of our children, there are difficult things we need to ask of one another in these difficult times, and this is one of them," O'Malley said.
Though O'Malley's budget proposal is not reliant upon raising the state's gas tax, he said this is still under consideration, as is an increase in the flush tax on sewer bills.
His critics were quick to point out these taxes would add up.
"It's death by incrementalism," Sen. David Brinkley, R-Frederick, said.
Also controversial is the governor's plan to shift half the burden of teacher pension costs from the state onto county governments.
Though the state will take on 50 percent of retired teacher Social Security costs in turn, the proposal projects $239 million in additional costs for local governments.
"I have become convinced that some better sharing of that responsibility is in order, primarily because the counties are much closer to the negotiating table than the state is," O'Malley said.
O'Malley attributed his change of heart largely to Senate President Thomas V. Mike Miller Jr.'s argument that contract negotiations are the major drivers of teacher retirement costs.
"I'll only be satisfied when it's enacted into law," Miller said, when asked if he was pleased with the governor's newfound stance.
The governor stressed that job creation remained his No. 1 priority while drawing up his budget proposal, going so far as to say this budget was the best at creating and supporting jobs since the recession began.
His plan would allocate $373 million towards school construction, the second-strongest investment he's made and one he claims will spur job creation. However, an increase in the gas or flush tax could conflict with this aim, according to critics.
"He doesn't know how to create a private sector job," Brinkley said of the governor.
The senator would rather see O'Malley stay out of the private sector's way and allow government projects like InvestMaryland to fund innovative startup companies—generating jobs through business growth.
While O'Malley stressed a balanced approach to the budget, opponents assert he hasn't addressed the root problem—spending.
His proposal includes $610 million in reductions and cuts to the General Fund, but the budget is still set to grow by 1.9 percent in fiscal year 2013.
"There's different ways to look at it," O'Malley said, when pressed on the budget increase.
"You won't find another administration in the history of our state that has restrained spending as steadily, that has made as many cuts as we have made, and you can cross the numbers all you like," O'Malley added.
Warren Deschenaux, the General Assembly's chief budget analyst, is pleased with the governor's proposed changes to the spending line.
Chief among these are the reductions in Medicaid, which will save the state money if implemented this year and continually thereafter, Deschenaux said.
He predicts the gap between revenues and spending will be down to about $400 million by year's end, bringing Maryland closer than it's been in years to being structurally balanced.
"That's tantalizingly close to concluding our dance with the structural deficit," Deschenaux said.
"It might even make us think that if we just did a little more we could be done."
Capital News Service's Kelsey Miller contributed to this report.
Dan
7:27 am on Thursday, January 19, 2012
This is slow torture - I would rather just receive a bill and pay it instead of having a lot of little taxes hidden EVERYWHERE!
KatieSilverSpring
8:19 am on Thursday, January 19, 2012
How about this, Gov; stop spending? stop travelling to China to marvel at their "accomplishments"? of course the Gov had to gerrymander his way into this power position but one day, oh, one day. You're on the verge of creating a riot in Montgomery County alone: gas tax, UMd tuition increase, income tax increase, bag tax. You do realize, don't you, Gov, that every part of Maryland is near another state or jurisdiction, right? You may have gerrymandered us out of a vote, but this uber-taxing will be your downfall.
Dan
8:39 am on Thursday, January 19, 2012
I am not voting for ANY incumbents on ANY level at the next election! Every last one of them does not do what is best for the county, state or country. It is sad to look at the elected community. Do any of them care about the common citizen that they represent? No, only worry about getting re-elected and leveraging their position for gain after their public office ends!
jag
10:44 am on Thursday, January 19, 2012
The sky is falling! The sky is falling! People who make $175,000 might no longer get as many tax credits and exemptions as before! AHHHH! And tuition! Why can't the state pay for all my tuition, but keep taxes exactly the same! WHY?!? Same with the gas tax - sure it hasn't been raised in 20 years and sure the amount and age of infrastructure to take care of has gone up considerably since 1992, but why can't O'Malley just do more work with the same amount of money?! That's obviously how the world works, right? Rabble rabble rabble!
Bob
6:08 pm on Thursday, January 19, 2012
who are you kidding and what orifice did you pull your "BS' from? we have had taxes raised 3 times in as many years, a new tax on oil, gas and electricity. increases in tolls, bag tax, soda and alcohol tax. increase in vehicle tax, licensing tax and property tax. cigarette tax, telephone tax and increases in costs of college. a tax on prescriptions was looked at and you make a dumb and innacurate statement about 1 tax not being raised in 20 years? Bull. You need to look at the costs.
jag
7:10 pm on Thursday, January 19, 2012
Oh, bob, you're so smart. Please teach me everything you know.
What BS? I was responding to someone complaining about the possibility of an increase in the gas tax and complaining at rising tuition rates. I have no idea what you're blabbing about imaginary increases in taxes, much less the fact you're completely making up things like a tax on soda. I apologize for not addressing her (and your) complaint about MoCo's bag tax, but it doesn't make any sense to bring up since it's a county fee and the article is about state tax exemptions.
Anyone who is slightly educated knows that we are currently taxed at historically low levels. Feel free to argue that that's a good thing, but pretending that you're being overwhelmed with higher taxes is just nonsensical. I suggest you spend your time reading about the issue instead of making up imaginary taxes and calling people dumb.
Bob
8:26 pm on Thursday, January 19, 2012
oh jag, I think you need to pull your prospective head out of ....the sand. Why don't you look at what's been taxed. google it, snopes it or what ever. Even a young college kid can see what's going on and talks about it at the dinner table. Hmmmm, smarter than you? What! you didn't make it that far? You seem to feel that you aren't taxed enough. Send it in, buddy! Maybe you make a heck of alot more than most people, but I certainly don't. Why don't you check your electric bill, or heating oil bill with the sur-charge tax. Sewer? check that out too. Maybe you don't get the "Sur-tax" that others do. You must be special or clueless. What about the additional increase in property tax, don't get that either? HMMMMM. You either are living in an imaginary world or some doofus working for O'Malley. Maryland and it's Counties have increased taxes throughout, yes, including the 5 cent per bottle tax. imaginary? Don't think so bucko. Read that jag....TAX. Now maybe words have different meanings to the left, but it's a tax brought to the taxpayers by the "people in charge", the elected ones. Funny, how your sarcasm is so off base kinda leaves one, breathless. Public school education? TAX is a tax. You're so smart, jak, maybe you can figure it out. Maybe, but I don't hold out hope.
jag
10:29 pm on Thursday, January 19, 2012
I honestly don't even know what you're trying to say. Yes, there are taxes to maintain the infrastructure of our state and country. I'm sorry if they're burdensome to you. Yes, those taxes are determined by people we elect and charge with balancing the budget. I applaud you for being young and agitated, but the fact that you just march around calling people dumb and whine about how O'Malley should be recalled is really, really sad.
If you'd like to actually make a point, I'd love for you to go down the list and itemize all the tax increases we've seen over the last 4 or 8 years. You seem to think they're steep. I'd love to be convinced of that. What about federal taxation? Is that also an issue? What's the average federal tax burden now and how does that compare to 5, 15, 30, and 50 years ago? Do you feel the current tax burden stymies growth? Is that the issue? Or are you just pissed that stuff isn't free? I don't really know what your point is, other than you think I'm dumb and O'Malley is dumb and greedy (because, of course, he gets pleasure out of collecting taxes and repairing roads and funding schools).
Maybe when you grow up a bit you'll learn that no one likes taxes. Some of us just understand that stuff isn't free no matter how much you stamp your feet. Balance the damn budget. College costs money. Sewers cost money. Cleaning effing plastic bags out of the bay costs money. Fund them and quit expecting handouts and nonsensical tax deductions.
Bob
7:23 am on Friday, January 20, 2012
I think before you tell someone to grow up you figure out if that person is older that you. Probably would be a good item to do as most intelligent people would do that. taxes have increased in many different ways, electricity (an additional "surcharge that goes to state coffers) water and sewer, (again to state coffers), an increase in property taxes when ghome values have plummeted (as an example, my home is worth 23% less than 2 years ago and my taxes have increased by 4% over what I was paying before. is that tax or theft?) Many intelligent states have dealt with the bag tax a different way, the bags are engineered to breakdown after a short period of time, but hey, this admin wants to tax, regardless of state or local. bottles are next but there is already a "value added" tax on them...value added??? Cut me a break. I constantly hear about what new taxes are being looked at and which ones are in place, why is it that you don't hear it? Deafness or you make enough that you don't care about others. Sure I think everyone should pay some into taxes, how about a flat rate for everyone? The kids I talked about were my own, intelligent and seeing to folly of this administration and what they are failing to do instead of what they can do. Many people in the state and local counties haven't had a raise in 4 years, how do they feel? And for the handouts, it's time to look at whom is getting what. we have a spending problem not a revenue one.
jag
10:46 am on Friday, January 20, 2012
Thanks, bob, I appreciate you expanding beyond your initial name calling and weird comments re: O'Malley. Seems you feel you're being nickel and dimed (literally, in most of the cases you cite). I actually like that about (most) state taxes - I pay a water bill and see what I pay towards sewer maintenance, I pay property taxes and know it's a chunk of the funding that keeps the schools near me in high standing, etc. I'd love if the Fed. govt did the same thing and then maybe we'd actually pay for wars with (what you consider to be nefarious) surcharges/taxes instead of just lumping the costs onto the deficit and pretending like they don't exist.
Ultimately, I think it comes down to a balance and I'd encourage you to reconsider your stance (maybe I'm misunderstanding) that new taxes aren't ever necessary. I think you're probably not understanding your property tax situation correctly - there's no way your property taxes would be going up y/y if your assessment was 26% less. Either you're saying your assessment isn't properly aligned with the value of your home (you should definitely file for a reassessment if that's the case) or you're just being phased into the real value of you home thanks to MD's Homestead Tax Credit. Ultimately, the economics of the situation is that income and property values are down. We can fire 26% of the teachers in your neighborhood and screw your property values (and kids), or we can try and do the best we can and balance cuts and new revenues.
Caleb Levin
4:52 pm on Tuesday, June 19, 2012
jag, are you another angry Obama supporter? You sound comfortable bending over while O'Malley and other Maryland Dems mount you for one more tax poke, you dunce!
jag
5:49 pm on Tuesday, June 19, 2012
Yes, Caleb. I'm one of those few dunces who actually thinks we should pay for the real cost of things instead of only a fraction and piling the rest onto the debt. Crazy ol' me not whining about my historically low tax burden. Crazy ol' me for not wanting to continuing digging the massive financial hole Boomers have put this country in.
KatieSilverSpring
7:34 pm on Tuesday, June 19, 2012
Frank - it is TEA Party Patriot, not teabagger - the use of that "teabagger" term is very anti-gay (it is a gay slur) so I would suggest you try another perjorative should you want to insist on disparaging us.
jag
7:45 pm on Tuesday, June 19, 2012
FYI, Katie, no, it isn't anti-gay. Google what teabagging is if you care to know. It has nothing to do with homosexuality, at least not anymore so than it has to do with heterosexuality.
KatieSilverSpring
8:04 am on Wednesday, June 20, 2012
yes, jag, regardless what Google says, it is an anti-gay reference. Google has been screwed with; if you Google a famous politician of late, his last name is re-defined. So caution is what is necessary with Google - which is why I use bing.com instead.
KatieSilverSpring
8:07 am on Wednesday, June 20, 2012
Frank - since you don't know me, you are making further nasty remarks without background. Amd, my name is not Kathy.
jag
10:12 am on Wednesday, June 20, 2012
Katie, I can assure you teabagging has nothing to do with homosexuality, specifically. I'm not relying on Google for the definition (I've been well aware of the word since my youth), nor do I know why you'd think the websites Google point you to have been "screwed with." I just Binged it and the same, common, definition came back (it actually specifies an act between a man and woman, though I've never understood the word to be ONLY related to heterosexual relations). Frankly, I don't care if you believe me, Google, and Bing and everyone else who's been familiar with the word for many years. Just thought I'd point out that you're indignation is unwarranted. I appreciate that you're looking out for our homosexual brothers and sisters - you just don't need to worry about it in this case. Cheers, Patriot Katie (you guys seriously call yourselves patriots? That seems a bit over the top).
jag
10:13 am on Wednesday, June 20, 2012
Katie, I can assure you teabagging has nothing to do with homosexuality, specifically. I'm not relying on Google for the definition (I've been well aware of the word since my youth), nor do I know why you'd think the websites Google point you to have been "screwed with." I just Binged it and the same, common, definition came back (it actually specifies an act between a man and woman, though I've never understood the word to be ONLY related to heterosexual relations). Frankly, I don't care if you believe me, Google, and Bing and everyone else who's been familiar with the word for many years. Just thought I'd point out that your indignation is unwarranted. I appreciate that you're looking out for our homosexual brothers and sisters - you just don't need to worry about it in this case. Cheers, Patriot Katie (you guys seriously call yourselves patriots? That seems a bit over the top).
KatieSilverSpring
2:24 pm on Wednesday, June 20, 2012
"I'm curious who it was that gave you this incorrect information."
Frank - work out your curiosity with jag; I'm tired of both of you and your relentless attacks on people you deem to be conservative and unworthy of any respect. Patch.com is not a hate site where you can attack people as you do.
jag
2:43 pm on Wednesday, June 20, 2012
Huh? Keep me out of it, Katie. I'm far more respectful to you than you've ever been to me. You treat people like trash. I'm so sorry you view my patiently explaining something to you as an attack. Just use a dictionary next time, I guess.
Arbutus Town Crier
10:44 pm on Sunday, June 24, 2012
Bob this is a warning Jag, Steve, TBW and a few other are inescapable of holding of holding a proper debate and thoughts, Its there way or the hi-way.some of us speak the truth but some are plants that are to disrupt deflect of compromise they use far left tactics such as elementary school name calling don't worry please speak your mind these guys are to rattle your emotions and trip so they can get credit to make you look as a fool. Stay strong reality, commonsense and reasoning they cant comprehend looking forward to your thoughts WELCOME TO THE JUNGLE!
Arbutus Town Crier
8:08 am on Monday, June 25, 2012
Jag, Thank you for your comment! It was intent that you have class!
You seem to be 1% upper class that you fail to recognize all citizens’ by disrespecting the people of America. You apparently are why our country is in the situation, the abuse of ignorance of different classes. You’re the one of many that sits on pedestal look down at American citizens. But when it comes getting the vote out you’re the first person to put out Propaganda! Remember your Statement. You took my hook line and sinker!
“??? Yep, it's true, I hate "made in America" and I love helping rich people like Michael Phelps.” That's exactly what I've said”” …..Jag quote!
The 1% you represent.
I’m human and make mistakes like everyone else but you. The reason for the cap is the Private sector that held jobs 50K and less are out of work but public sector (Government workers) is the guarantee income for the State.
Bob
6:02 pm on Thursday, January 19, 2012
A family of 4 making 150k high earners? who are you kidding, O'malley? You are about as dumb as they come and as greedy as a thief. We need to recall this moron.
Dan
7:37 am on Friday, January 20, 2012
The state needs to look at all the handouts and start a program to reduce these giveaways! I am happy to pay my fair share into the system, but I prefer that it not be given away to some lazy non-productive member of society or someone who is in this country illegally and lives off the system.
Bob
7:44 am on Friday, January 20, 2012
One final........ This administration has lost many businesses due to it's unfriendly atmosphere. Bechtel being a rather large one will be moving to neighboring Virginia. There are many others that have left or are in preparation to leave. Time for O'mally to look at his problem, it's called spending. We have a spending problem with all of the different groups that want handouts not a revenue problem. We have been asked to give more and more, yet they continually increase spending. Maryland needs to target specific items that need funding and cut those that shouldn't get funding. Tighten your belt, O'malley, ours are on the last notch and are already too tight.
Jr
10:16 am on Monday, April 9, 2012
Tax, tax, tax, tax, tax. It's all o'malley knows. Raid the transportation fund then charge taxes to raise transportation revenues. Now he wants to increase the sewer tax all the while punihing septic owners so that they can force people onto the higher tax sewer system. Do yourselves a favor. Leave Maryland. I regret moving here
Angela
12:23 pm on Thursday, June 14, 2012
$100000 is too low!thats about near the mid minimum of what you have to pay to be middle class in the expensive state of Maryland. People in this price range do not get tuition help except a ton of high interest loans (i know because my parents are in this area) and though their house cannot be sold for even close to what they bought it for, they still cannot lower their monthly mortgage payment. O'malley is a selfish fool who wants to be a democratic leader, however he is too awful of a state governor to ever advance in politics
jag
12:44 pm on Thursday, June 14, 2012
$100k is for single people, adjusted gross income (net income is commonly much, much higher), and the fraction of a percent tax hike only applies to income above the adjusted $100K ($150K for couples) threshold (in case you don't know how taxes work - it doesn't sound like you're out of school yet). Why would such a group (of which I'm one) need help with tuition? That doesn't make sense. Nor is the issue of a poor home investment pertinent. O'Malley doesn't keep the money, so I'm not sure why you're calling him selfish. In fact, he'll pay more in taxes just like the rest of us in the bracket.
Laura L Thornton
4:58 pm on Wednesday, June 20, 2012
Commenters, please remember keep a civil tone in your replies. Thanks! - Laura