With the state’s sales tax on alcohol rising by 3 cents today, groups set to benefit from the estimated $84.8 million in additional revenue in fiscal 2012 already are gearing up for a potential battle over the future money stream.
In the first year of the 9 percent sales tax on beer, wine and liquor, $47.5 million of the additional tax income will be directed to schools in Baltimore city, Prince George’s and Montgomery counties, while $15 million is dedicated to shortening a lengthy waiting list of people in need of developmental disabilities services. The remaining funds are going to the general fund.
After fiscal 2012, which also begins today, the money generated by the tax will not go specifically to those causes but rather to the state’s general fund. Tax revenue from the 3 percent increase is expected to increase to $90.7 million by fiscal 2016.
“Everybody’s going to be in line grabbing and growling to get that money,” said Del. Galen R. Clagett (D-Dist. 3A) of Frederick. “You can bet Baltimore city, Montgomery County and Prince George’s County are going to get at that money again next year.”
Clagett, a moderate Democrat who voted against the alcohol tax increase, said he is disappointed that all of the additional money wasn’t directed to the general fund.
While supportive of education and disability services, Clagett said it was unwise to create new funding avenues at a time when the state had to resolve a $1.6 billion deficit.
“The legislature is just absolutely unrealistic. The governor didn’t send this thing in, he lost control of what’s going on,” Clagett said.
Gov. Martin O’Malley (D) sent a letter Thursday to members of the Lorraine Sheehan Alcohol Tax Coalition, a group that initially advocated the legislature impose a 10-cent-per-drink tax to benefit the developmentally disabled and other health causes, supporting its cause.
“With respect to future alcohol tax revenues, we share the same goal to address the broader spectrum of health and community services needs identified with the original Lorraine Sheehan Act,” he wrote. “I fully support the goal of facilitating effective and efficient investments in Medicaid, programs for people with developmental disabilities and mental health needs, substance abuse treatment and prevention, and health care workforce development.”
Vincent DeMarco, president of the Maryland Citizens’ Health Initiative, which championed multiple versions of the alcohol tax, said his group intends to push for more funding from the alcohol tax for their cause, but Clagett warned that health care advocates likely will be up against the three jurisdictions that received education funding this year.
“We’re in trouble in terms of what we’re doing with the general fund,” Clagett said. “I would rather cut or move, transfer money from another program to that program than gin up another operation.”
Del. Curtis S. Anderson (D-Dist. 43) of Baltimore said the disabilities advocates deserved a portion of the revenues because they pressed the issue with lawmakers.
“All the fat cats are saying, ‘We’ve got everything solved,’ and then somebody said, ‘This money from the alcohol tax had been proposed by these advocates,’” Anderson said. “It kind of put the idea of alcohol tax in the minds of a lot of legislators, so when we were working on this deal, we said we can’t cut them out totally.”
However, Anderson did not say advocates should be entitled to the funds again next year and can’t say whether his delegation will push to continue the education funding it received this year. He did say it would be difficult to tell constituents he was not pursuing education money.
“We all understood that this was kind of like a little work in progress for this legislative session and next year is a brand new year,” Anderson said. “Everybody’s back to square one. We have no expectations on how things fall into place (in the future).”
sbreitenbach@gazette.net
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