The Washington PostDemocracy Dies in Darkness

Hogan attacks Democrats on crime bill, expanding sales tax to fund schools overhaul

February 20, 2020 at 7:27 p.m. EST
(Katherine Frey/The Washington Post)

Gov. Larry Hogan aggressively lashed out at Democratic leaders Thursday over two top priorities of this legislative session: funding a sweeping public education overhaul and stemming escalating violence in Baltimore

Hogan, a Republican, condemned a Democratic proposal to raise money for schools by expanding the sales tax to include professional services, saying the change would “destroy our economy.”

Democrats, meanwhile, scorned Hogan’s demand to stiffen prison sentences for violent offenders, accusing the governor of relying on poll data to address crime in Baltimore instead of proven crime-prevention strategies.

The governor “has got to start leading and stop polling,” said Senate Judicial Proceedings Chairman William C. Smith Jr. (D-Montgomery), after Hogan said Smith’s refusal to move his mandatory minimum bill should disqualify the lawmaker from the committee chairmanship.

Smith accused Hogan of pushing the kind of “draconian policies” that have “destroyed and decimated generations of Marylanders, most of whom are black and brown.”

Hogan spoke in catastrophic terms about the Democratic tax legislation and vowed to stop it.

The proposal would broaden the sales tax to services including lawn service, yoga classes and financial advisers, but also cut the rate from 6 percent to 5 percent, lower than neighboring Virginia and Pennsylvania.

The tax would generate $2.6 billion a year by 2025 — a 50 percent increase over current sales tax revenue — that would be spent on improving public schools.

It would not apply to education services, childcare, health care or services provided by nonprofit or civic organizations.

“Maryland’s sales tax is antiquated,” said House Majority Leader Eric G. Luedtke (D-Montgomery), who sponsored the bill. “We tax goods and not services, and the economy is on services.”

An August report on state revenue described the growth of Maryland’s sales and use tax as “generally weak” and recommended broadening it to include services.

But the National Conference of State Legislatures said only four other states broadly tax services. Many states have attempted to do so but failed, researchers with the organization said.

Luedtke said the tax would generate enough to pay the balance needed for a landmark education bill that calls for expanding prekindergarten for 3- and 4-year-olds, increasing teacher training and salaries, funding grants for schools with a high percentage of students from poor families and boosting money for special education.

The overhaul is the top priority for Democrats, who hold veto-proof majorities in both chambers of the legislature.

The sales-tax expansion is just one option the House is considering to generate more money for schools. The Senate is also considering raising revenue by increasing a tax on cigarettes, taxing digital downloads and digital ads and allowing sports betting.

Because wealthier residents are believed to spend more on professional services, the sales-tax change would make the state’s tax code less regressive, Luedtke said, shifting a greater burden to the affluent.

He also said it would address a disconnect between Maryland’s tax code and major sources of commerce in the modern economy. “Why should we tax books but not bookkeeping?” he asked. “It’s a better tax policy in general.”

Hogan, who campaigned on an anti-tax agenda in 2014, said the proposal “is a tax on working families,” since it would apply regardless of income.

“It’s a tax on single moms,” he said. “It’s not ever going to happen while I’m governor. I can promise you.”

Hogan said his internal polling shows that only 2 percent of Marylanders support a tax increase. He also said Thursday that his internal polling shows residents widely support his crime package, which would impose increased penalties for repeat violent offenders and those who intimidate witnesses. Another bill would require public records of how judges sentence violent criminals.

The governor mentioned his polling data 11 times in a nearly 12-minute statement to reporters.

Within hours, a Democratic lawmaker had tweeted criticism of Hogan with the hashtag #stoppollingstartleading.

Smith invited the governor to testify before the Judicial Proceedings Committee about his crime legislation, so that the committee can have “an intellectually honest conversation” about any data that shows why the bill is merited.

Senate President Bill Ferguson (D-Baltimore City) said Hogan was “out of line” to suggest Smith should resign. “This session is about solving problems and not pointing fingers,” Ferguson said.

House Speaker Adrienne A. Jones (D-Baltimore County) said Hogan bears some responsibility for the soaring crime in Baltimore, where more than 300 people have been killed in each of the past five years.

One-third of the murder victims and 27 percent of murder suspects in Baltimore last year were on parole or probation and therefore under the state’s supervision, Jones said. The union representing parole and probation workers has complained for years that the administration has left their department dangerously short-staffed.

“What are the Governor’s plans to inject some urgency in staffing his own Departments that can help curb some of this violence?” Jones asked in a statement. “. . . We cannot just add more criminal laws on the books if the ones we have aren’t being used effectively. We cannot arrest our way out of this problem.”

Jones said Hogan has not met with her since the legislative session began Jan. 8. “If he has an urgent concern about his bills, I invite him to pick up the phone or talk to me directly,” she said.

Students failing, teachers fleeing: In Md., calls for sweeping — and expensive — education reform

In Maryland, discontent with taxes, economy paved way for Hogan’s victory

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