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Property Tax Cut Pursued in Md. House

Additional $100 Million for School Construction Included in Budget Proposal

By John Wagner
Washington Post Staff Writer
Saturday, March 19, 2005; Page B10

Maryland homeowners would receive a property tax reduction of nearly 5 cents on every $100 of assessed value, and schools would benefit from an extra $100 million in construction funds, under a budget proposal presented to the Maryland House of Delegates yesterday.

The $25.6 billion budget, which lawmakers brought to the floor for initial discussion, would cut nearly twice as many state government positions as Gov. Robert L. Ehrlich Jr. (R) had suggested in his initial spending plan and provide additional money for land preservation and state workers' health coverage.

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Democratic leaders of the House Appropriations Committee said the cut in the property tax rate would provide relief to homeowners across the state, including those in the Washington suburbs who have seen startling jumps in assessments and property tax bills. Under the House budget, the state tax rate would drop from 13.2 cents per $100 in assessed value to 8.4 cents, saving the owner of a $400,000 home nearly $200.

"At a time when we're able to . . . we ought to be responsive to the needs of the people," said Appropriations Committee Chairman Norman H. Conway (D-Wicomico) said at a news conference called to tout the budget.

The tax rollback was greeted coolly yesterday, however, by budget writers in the Democrat-led Senate and by aides to Ehrlich.

Sen. P.J. Hogan (D-Montgomery), vice chairman of the Senate Budget and Taxation Committee, said it is "doubtful" that Senate leaders will include a similar reduction in their fiscal 2006 budget because doing so would make it harder to balance future spending plans.

Ehrlich's budget secretary, Chip DiPaula Jr., called the House move "a one-year gimmick," suggesting that significant cuts in services would be needed in other years to preserve the rollback, which would cost the state about $205 million next year.

DiPaula said it is possible, however, that the Board of Public Works, a panel on which Ehrlich sits, could approve a more modest reduction, of 1 cent or more, when it considers the issue in May.

"This is a good sound bite for a day," DiPaula said of the House action. "The governor would like something more permanent."

The House's move would erase a tax increase enacted in 2003, Ehrlich's first year as governor, as part of a series of measures to close a gaping budget hole.

The House's plan to spend $250 million on public school construction next year, nearly $100 million more than Ehrlich has proposed, got a better reception yesterday.

Hogan said Senate budget writers would like to reach that level of spending "if we can fit it in." Ehrlich has proposed spending $157 million on school construction for fiscal 2006, which starts in July, but DiPaula said the governor is open to a higher amount.

School construction has become a high priority for lawmakers this year as enrollment continues to overload available facilities.

To free up money for state employee health benefits, the House budget would cut Ehrlich's proposed cost-of-living increase for workers from 2 percent to 1.5 percent next year.

Lawmakers said the same goal was driving additional cuts in state positions. The House budget would cut 969 positions, 475 more than Ehrlich proposed. Of those the House has targeted, 774 are vacant and 195 are filled.

Republicans have criticized House Democrats in recent days for targeting positions held by Ehrlich political appointees, a tactic Conway played down yesterday.

"We did not look at names," Conway said. "We did not look at party affiliations."

As they worked on their spending plan yesterday, Senate budget writers stressed that, when possible, they are giving the administration more flexibility to choose which jobs should be eliminated.

"The Senate's position appears to be much more humane," said Sen. David R. Brinkley (R-Frederick), a member of the Senate budget committee.

Cuts that the House committee would make to pay for its priorities include reductions in Medicaid spending, technology projects and smaller initiatives, such as providing laptops in state police patrol cars.

Separately yesterday, Ehrlich put forward a supplemental spending request of about $21 million for initiatives not included in the budget he proposed in January. The measures include an additional $1 million to help private schools buy textbooks and $3.8 million for biomedical research performed by academic health centers.

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