2016 Session Leaves Missed Opportunities to Help Working Marylanders
When this year’s legislative session began, there was the potential for the General Assembly to take meaningful steps to help thousands of Marylanders who struggle to make ends meet. There were also significant threats to Maryland’s future prosperity, with proposals for massive tax cuts for businesses and wealthy individuals that would deprive the state of much-needed for public investments that build the economy.
By the time the session came to a close at midnight on Monday, lawmakers had taken some incremental steps to help Marylanders working hard for low pay and other than that largely maintained the status quo.
Photo by Martin Falbisoner via Creative Commons
Missed Opportunities to Help Working Marylanders
Legislators missed an opportunity to give working people a much-deserved break when they failed to expand the state Earned Income Tax Credit. This proposal would have extended the EITC to low-wage workers without dependent children and workers under 25 who currently don’t receive the credit.
The bill cleared the House of Delegates only to have the Senate combine it with a package of income tax cuts that primarily benefitted the wealthiest Marylanders. The House would not agree to these tax cuts, so the bill ultimately failed.
There is no reason to hold help for hardworking, underpaid people hostage to tax cuts to the rich. We’ll be working to make sure that doesn’t happen in the next legislative session. A strengthened EITC ought to be considered – and adopted – on its own merits.
A proposal to enable most Maryland workers to take paid time off work when they or a loved one is sick met a similar fate. The bill that would have guaranteed most workers the ability to earn paid sick days passed the House and didn’t make it to a Senate vote.
Most Tax Cut Proposals Fail
Things could have been worse. In addition to those costly income tax cuts tied to the EITC bill, there were numerous proposals from the Augustine Commission and the governor that would have threatened Maryland’s ability to continue making needed public investment in the pillars of a strong economy, like education, transportation, and safe communities. Many lawmakers understood that Maryland cannot meet its growing needs if it gives big tax breaks to corporations and millionaires, and most of these proposals failed.
However, the General Assembly did provide a massive tax break to one large company. Defense contractor Northrop Grumman will save $37.5 million on its corporate income taxes over the next five years. The company also got a $20 million loan from the state. Carving out special treatment for one employer, no matter how large, sets a terrible precedent – particularly as this gift came with few strings attached. The company must maintain its large workforce in Maryland to get the credit but this state expenditure does not create a single new job.
Budget Limits New Investments
The budget that the governor and the General Assembly adopted for the fiscal year that starts July 1 essentially maintains the status quo for state services. There were no major reductions in services – but also little to no effort to better meet the needs of families still struggling to get by in an uncertain economic recovery.
One bright spot was a united focus on Baltimore City., State leaders agreed on significant investment to demolish blighted properties and take other steps to help the city following the unrest one year ago.
New Policies Help Some
Budget openness – There will be more transparency in how the Board of Public Works makes adjustments to the state’s budget. This three-member panel has the ability to reduce line items in the state budget up to 25 percent. The BPW previously did not have to provide any public notice of its meeting agenda when it was considering budget cuts, leaving the public no opportunity to weigh in. Thanks to legislation passed nearly unanimously in both chambers, the BPW now must give at least three business days’ notice before voting on cuts.
Help for hungry seniors – Low-income Marylanders age 62 and above will able to better afford to buy food now that the General Assembly approved increasing the minimum monthly benefit for food assistance to $30. Unfortunately, legislators opted not to increase benefits for all the other Marylanders trying to get by on the current $16 minimum monthly benefit.
Closing the pay gap – Lawmakers strengthened Maryland’s existing laws prohibiting pay discrimination based on gender, prohibiting employers from retaliating against employees for disclosing their salaries. The goal is to reduce the pay gap between men and women. The measure also prohibits discrimination based on gender identity.
Spending less on prison, more on helping people – Landmark justice reinvestment legislation will save the state money by reducing long mandatory minimum prison sentences and investing more in addiction treatment and mental health services – ultimately keeping more people out of the criminal justice system.
Improving the Renters Tax Credit– Some low-income renters are now eligible to receive a tax credit that helps them make ends meet, although the program isn’t used much because few people are eligible and the credit is small. Legislation passed this year increases the income cap to $60,000 per household and increases the credit by $300 per renter.
