House, Senate close in on budget compromise -- Gazette.Net


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After three days of posturing, lawmakers came closer to resolving the $36 billion-plus state budget Thursday night.

Sen. Edward J. Kasemeyer (D-Dist. 12) of Columbia, chairman of the Budget & Taxation Committee, presented a proposal to the budget conference committees that would combine elements of the House and Senate revenue plans and leave the state with a $156.3 million fund balance at the end of fiscal 2013.

The plan would generate $309.2 million for the state and $69.4 million for counties by raising the tax rates on Marylanders making more than $100,000 per year and by cutting personal exemptions.

Previously, House leaders said they could not support any plan that would create a new tax for Marylanders making less than $100,000 per year.

“We were very focused on trying to hold people in the working class harmless,” said House Majority Leader Kumar P. Barve (D-Dist. 17) of Gaithersburg.

Barve said he would prefer to see a different income tax compromise — one that would include smaller tax hikes and smaller cuts to personal exemptions for those making less and a “super bracket” that would change the way taxes are collected for the wealthiest Marylanders, bringing in more than $30 million on its own.

Kasemeyer said the Senate also would agree to a compromise on the proposed shift of some pension costs to counties. The Senate would get behind the House plan in the first year of the multiyear shift, but would want to negotiate how to handle the remaining years.

The original Senate plan called for a four-year, even phase-in of the “normal cost” of teacher pensions, meaning the amount needed to pay pension liabilities if the system hadn’t been underfunded in the past. The House plan is a three-year phase-in that is front-loaded to pass on half the normal cost in the first year and 25 percent in the remaining two years. It would save the state more money in fiscal 2013 and 2014.

Lawmakers are trying to pass a budget that would close the state’s $1.1 billion structural deficit within the next two years before the general session’s scheduled adjournment Monday.

The budget conference committees are scheduled to meet again at 8:30 a.m. Friday.

dgaines@gazette.net