Like most of you, I have spent much of the last few days sheltered inside, shoveling snow, and trying to eat all the food we purchased before the storm. I hope you and your family stayed safe and warm during the storm and that you have withstood any unfortunate plowing delays. It seems like a long time ago now, but before the blizzard a smaller storm caused great disruption to the evening commute because of a lack of preparation. Like many, I was stuck in dangerous traffic for hours. I have reached out to the State Highway Administration regarding the event in the hopes that the agency can perform better in the future. You can read my letter here.
The big news this past week was the Governor's submission of the budget. For the first time in about ten years, the budget outlook is not entirely bleak thanks to a (slowly) recovering economy. The state is projected to conclude the current fiscal year with a surplus and also achieve a surplus next year. These projections are not static, of course, and conditions may change. Many will claim credit for this stable budget outlook. But recall at the end of the last legislative session the Governor and his staff complained that the budget the legislature passed was going to lead the state to fiscal ruin. Those partisan complaints--coming after the Governor's Budget Secretary originally lauded us for the same budget--were obviously overblown.
Here are a few highlights from the budget proposal:
As a member of the Appropriations Committee, I will spend the next several months conducting a detailed review of the budget. The legislature will make some alterations where appropriate within the constitutional confines we work within (we cannot increase funding to a budget line item). More broadly, significant questions will need to be addressed such as whether the small surpluses should be used for ongoing tax cuts (which will have costs far into the future after the surpluses are spent) and whether various mandated spending formulas should be altered.
Sidewalk closures are a frustration in areas with development such as downtown Bethesda or the Pike District (White Flint). My first bill of the session would conform sidewalk closures along state roads to the current rules for County roads. The rules require that a public notice be posted with contact information for the responsible party and the expected length of the closure. Frankly, I would like to see more effort be made to avoid sidewalk closures entirely in our walkable communities. New York City is able to demolish and rebuild skyscrapers while barely closing sidewalks, yet the slightest project seems to lead to a prolonged closure in our communities. We even had a circumstance last year where a business was entirely cut off for the weekend--with no advance notice--by a state approved sidewalk closure. I am pleased to be working with Senator Brian Feldman on this bill, which was first suggested to us by Councilman Roger Berliner. The bill will have a public hearing on February 4th before the Environment and Transportation Committee.
Last year, I had legislation related to energy storage, the concept of using batteries or other technology to store energy produced at non-peak times for later usage including for baseload power and to help utilities improve grid efficiency. Storage is particularly useful when paired with renewable energy sources. The committee of jurisdiction asked the Maryland Energy Administration to study the issue instead of moving the legislation. The study was recently released and was the subject of a committee briefing last week.
The study surveys energy storage technology and public policies put forth in other states. I am hopeful we can continue the conversation in Maryland and move forward with a policy that encourages the use of this technology here.
The Economic Development and Business Climate Commission (better known as the Augustine Commission) issued its second report.
Last year, the Augustine Commission's first report included a number of useful suggestions that became law that streamlined our state's approach to economic development and put a premium on customer service by state agencies. This year's report left me somewhat disappointed. To be sure, there are some valuable insights in the report including proposed enhancements to work my seatmate Delegate Frick has been doing on how we treat tax credits in the state. But the report also includes specific proposals for almost $2 billion in tax cuts that was unsupported and a vague proposal for future income tax cuts. The level of analysis supporting these proposals in my view is significantly lacking. For example, the report proposes cutting the corporate income tax rate from 8.25% to 7%, a $176 million annual reduction in state revenue. But no analysis is provided as to what effect this will actually have on drawing businesses here. First, few businesses pay the headline top rate (indeed, many Maryland businesses are not organized as corporations at all). Second, the report notes that many nearby states would still have a lower corporate tax rate, so if a businesses criteria for location is the corporate tax rate, this proposal is completely insufficient to improve the economic climate while causing serious harm to state revenue used to pay for priorities such as education. Similarly, the report proposes an $80 million annual change to the interest rate for tax deficiencies but provides absolutely no analysis or even anecdotal evidence that the interest rate causes any business to choose not to locate or grow in Maryland. I agree that Maryland can and should improve its economic climate, but I look forward to a vigorous debate on these particular recommendations.
District 16 Notes
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