The State Senate brusquely pushed aside arguments by labor unions and consumer advocates today and endorsed legislation to reduce pension costs by cutting employe benefits. It also gave preliminary approval to a far-reaching banking deregulation measure backed by the financial community.
The separate votes on two of this session's most controversial and heavily lobbied measures came after proponents argued that the Senate must be "fiscally responsible," hold down state costs, and encourage banks to stay in Maryland by relaxing regulations and eliminating many consumer provisions.
The pension bill, which was the focus of a massive lobbying effort on one side by teachers and state employes and on the other by Senate President Melvin A. Steinberg, provoked surprisingly little debate. It was approved by a vote of 26 to 17.
The pension bill will move currently employed workers covered by the state's former pension system into a less generous plan set up in 1979. Retirees would not be affected by the bill. The measure is expected to come up for a vote next week in the House, where its prospects are considered slim.
Union officials, who arranged for hundreds of telephone calls to senators over the weekend, promised an intensive effort to kill the bill at that time.
Opponents of the banking bill, which closely followed the recommendations of the finance industry, attempted unsuccessfully Friday night to add major consumer protections. Today, with those efforts exhausted, the measure won preliminary approval. The final Senate vote is set for later this week.
If left unchanged, the bill would permit financial institutions to charge credit card membership fees, levy a variety of other fees, and eliminate the 25-day interest-free period on credit card purchases. The 24 percent interest rate approved last year would not be affected.
Gov. Harry Hughes, Attorney General Stephen H. Sachs and consumer advocates had argued that the bill goes too far at the expense of consumers in its effort to compete with deregulated Delaware and Virginia. Hughes and Sachs drafted a less sweeping bill midway through the session, but it remains stalled in a House committee.
The bill's passage through the generally pro-business Senate had been expected, as banking lobbyists had pushed for it for months, calling it a "jobs bill." They reminded legislators that deregulation in Delaware has cost Maryland nearly 1,000 jobs and the credit card operations of several banks.
But House Speaker Benjamin L. Cardin told Steinberg that the House leadership is unlikely to support the measure when it formally takes up the bill on Wednesday.
Just a week ago, the bill appeared headed for defeat in the Senate Finance Committee. Steinberg, as the bill's chief sponsor, then launched an unusual appeal for support of his leadership and persuaded Sen. Howard A. Denis (R-Montgomery), to support the measure. Denis voted against the pension bill today, but similar appeals evidently worked with other senators.
"We helped elect the guy," said Sen. Thomas V. (Mike) Miller (D-Prince George's), explaining that once the debate became a dispute with labor, "we felt we've got to support him." Six of the Prince George's seven senators voted for the measure.