O'Malley to Offer Revenue Proposal In Special Session

Md. Tax Increases, Slot Gambling On Table in Risky Hurry-Up Play

Maryland Gov. Martin O'Malley (D) on Monday plans to call a special session of the General Assembly with the hope of securing quick action on his plan to close a $1.7 billion budget shortfall by raising several taxes and legalizing slot-machine gambling, his office said yesterday.

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Administration officials acknowledged that there is no guarantee that the session, scheduled to start as early as Oct. 29, will be a success. The governor has not secured consensus on several aspects of his plan, including a slots proposal projected to yield $550 million a year for the state.

But administration officials suggested the attention generated by a special session could spur lawmakers to reach deals on several issues that have divided them for years. Moreover, they said, if they wait until the regular legislative term in January, as some leading lawmakers have advocated, they will need to raise even more tax revenue than O'Malley has proposed.

"The governor plans to call a special session," O'Malley spokesman Rick Abbruzzese said. "The cost to taxpayers is too great if we wait."

O'Malley's proposals include overhauling the state's income tax brackets so that upper-end earners would pay more but most taxpayers would get a modest break; gradually reducing the property tax; and raising sales, tobacco, corporate and vehicle titling taxes.

The proposals would generate nearly $400 million a year in funding for transportation priorities in addition to closing the projected $1.7 billion shortfall in fiscal 2009, which starts in July.

There will be no time limit on the special session, but administration officials said they hope Thanksgiving will serve as a deadline for action.

House Speaker Michael E. Busch (D-Anne Arundel) and Senate President Thomas V. Mike Miller Jr. (D-Calvert) have cautioned O'Malley in recent weeks about the potential pitfalls of a special session. Republican leaders in both chambers have said they believe convening before January is a mistake.

"There's no deal that has been structured or is imminent, so I would have to presume this is a high-wire act," House Majority Leader Kumar P. Barve (D-Montgomery) said yesterday. "You're putting people who don't agree with one another in a tight little pressure cooker and hoping that brings them to agreement."

Sen. Ulysses Currie, chairman of the Budget and Taxation Committee, said O'Malley is taking a real gamble.

"I think without consensus it's very risky, and we don't have full buy-in yet," Currie (D-Prince George's) said. "On the other hand, the governor feels strongly that if we don't do something in a special session, it's going to cost the taxpayers more."

From the governor's perspective, there are both practical and political benefits to a special session, aides said.