Md. May Get Higher Gas Or Sales Tax
Increase Would Boost Transportation Fund
By Alice Reid
In this election year, Gov. Parris N. Glendening and most other candidates for state office are sidestepping the issue of raising taxes. But transportation planners and others concede that without an infusion of cash, the state's Transportation Trust Fund cannot adequately meet all the demands being placed on it.
"I think the electorate has known this for some time," said House Speaker Casper R. Taylor Jr. (D-Allegany), who will convene a panel this summer to study how best to raise money for the fund. "You cannot get blood out of a turnip. These are fundamental things that everybody in the electorate understands. When you run out of money, you quit building."
Maryland's situation points up the challenge many states face in maintaining existing roadways while keeping up with the demand for new highways spawned by sprawling development and dispersal of jobs away from urban areas.
Maryland also is in a somewhat unusual position as a state that uses its Transportation Trust Fund to finance not only highway construction but also operation of two mass transit systems -- in Washington and in Baltimore, where subsidies have been rising by 12 percent and 6 percent annually on average during this decade. In addition, the fund -- which takes in and spends about $2 billion annually -- supports the growing Baltimore/Washington International Airport and Baltimore's busy harbor operations.
Maryland is one of 20 states that finance all transportation needs -- from highways to transit to aviation -- out of the same pot of money. And the 23.5-cent-a-gallon gas tax, which is the fund's main revenue source along with federal funds, has not risen in six years. Typically the tax has been raised every four or five years.
Transportation could become an issue in next fall's governor's election as Glendening's opponents complain that the governor has allowed the fund to languish and has not given top priority to expanding the state's highway network.
"More and more people are sitting in traffic," said Eileen M. Rehrmann, the Democratic Harford county executive who is challenging Glendening. "And in the campaign, people want to know where you are on transportation."
Glendening, who ran four years ago on a no-new-taxes platform, is unapologetic about the trust fund, which he says has increased by more than $1 billion during his administration.
"The challenge to the state was rather than increasing the gas tax, to see if we could realize some other economies," he said last week. The fund has increased, he said, "without increasing taxes."
Some of the increase is attributable to cuts in the transportation bureaucracy but also to a booming economy that has generated more revenue without a tax increase, officials say. Glendening also has shifted some money from the port and BWI to highways. "They continue to find new ways to do things," said Bob Latham, head of the Maryland Highway Contractors Association.
Glendening also stands up to criticism that he has spent too much of the state's highway money on non-asphalt items such as sidewalks, sound walls along busy highways and other "quality of life" improvements. Estimates are that in the $2.8 billion highway capital plan for the next five years, $250 million is for sound walls, sidewalks, landscaping and other neighborhood enhancements -- or less than 9 percent of the total -- according to State Highway Administrator Parker F. Williams.
"Our commitment before we build new infrastructure that promotes sprawl elsewhere is let's invest in the communities that made this county great," said Glendening, as he announced a $275,000 sidewalk and crosswalk project near the Landover Metro station in Prince George's County last week. "People would rather have curbs, gutters, sidewalks and landscaping instead of a $70 million road built somewhere."
But those who maintain that transportation funds are scarce say that sound barriers, sidewalks and bus shelters are not the best way to spend limited money.
"The governor has got to answer whether the transportation system is better than when he was elected," Glendening's principal Republican challenger Ellen R. Sauerbrey said, adding that she would reorder the state's priorities to spend more money on highways and less on other transportation items.
She, like many others in Maryland from both parties, would like to move transit subsidies out of the Transportation Trust Fund and into the general fund.
"Drivers should not have to fund the rail and bus systems when we need such vital projects involving roads and bridges," she said.
Some analysts point out that gasoline taxes can't keep track of demand anyway because as cars become more fuel-efficient, they can travel farther without paying more in taxes per mile.
Taylor has introduced the notion of moving transit subsidies out of the transportation fund. Legislators interested in that idea talk about using a special sales tax, which might be imposed in urban areas with transit systems, to fund transit. But raising taxes of any sort -- on either sales or gasoline -- has not been a popular notion in most states during the 1990s.
Such reluctance to tax for transportation can stymie the state, according to Tom Corsi, a University of Maryland business professor who worked on the Greater Washington Board of Trade's transportation study.
"We've got a wealthy region. Our mean household income is the second-highest in the nation, and we're not really taxing ourselves," Corsi said. "We're not really looking to the future and doing what we need to sustain our growth."
"I think it would be a hard sell," said Brad Coker, who runs the Columbia-based Mason Dixon Poll. Raising taxes to support transportation "may be one of the more important things in the big picture, but in terms of political popularity, there are bigger causes, where people might say, 'If we're gonna raise the sales tax a penny, let's do it for schools or for the Chesapeake Bay.' "
Maryland Senate President Thomas V. Mike Miller Jr. (D-Prince George's) predicts that earmarking a sales tax for transit will be "a major battle in '99" in the State House.
Miller, who supported Glendening in not urging a gas tax increase during his term, now says something has to give.
"I think more revenue will be essential," he said.
A host of highway projects are foreseen in the state's $5 billion, five-year transportation plan released last month, but making them a reality will require millions of additional dollars in the Transportation Trust Fund.
The needs are especially great in Southern Maryland, where the population is projected to grow by more than 40 percent to 450,000 by 2020.
"All of our priorities are in motion," said Gary V. Hodge, director of the Tri-County Council in Southern Maryland. "But a number of our projects would not be completed if we don't get an increase in the fund next year."
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