Good and bad bills defeated in Maryland Legislature

The 2012 legislative session did not substantially advance the interests of cycling in Maryland. Last year saw the passage of House Bill 363, which created a new crime of vehicular negligent homicide, after years of lobbying by cyclists, AAA, victims families, and the elected states attorneys. And 2010 was a banner year, with both the creation of the 3-foot passing law and repeal of the long-hated mandatory shoulder use rule.

This year, the General Assembly rejected Governor O’Malley’s proposal to end the sales tax exemption for gasoline, which means that many transportation projects are likely to proceed more slowly than planned—including those that help cycling. The Purple Line will be threatened unless the Legislature provides funding next year. The Legislature also declined to give police the power to stop a driver for talking on a cell phone. But the news was not all bad:

• A Senate bill to repeal the negligent homicide statute was soundly rejected (S.B. 942);
• The House Environmental Matters Committee gave an unfavorable report to a bill that would have allowed automobiles to cross the double yellow line to pass bikes (H.B. 1397); and
• The House failed to act on a proposal to legalize cycling on all sidewalks statewide except for those in Gaithersburg and Baltimore (H.B. 946).

While each of these bills were poorly conceived, the sponsors had good intentions and it may be possible to accomplish their objectives without the problems their bills would have caused. Over the next few days, I’ll comment on the fate of those three bills and possible next steps.

(Jim Titus is affiliated with several Maryland cycling groups. The opinions expressed herein are Jim's alone, and do not reflect the views of any organization with which he is affiliated.)

Comments

[NeilB]

Also not acted on: SB 509, which would have provided $750,000 for bikeshare in Montgomery County. Maybe this will still be on the agenda if there is a special session to pass a budget?

[T1]

Not mentioned was O'Malley's continued raids on the Transportation Trust Fund over the years. Of course now he advocates for a sales tax on top of the gas tax. The truth is with the expense of the Purple Line, the ETLs, etc.

[Jim T]

@T1: Since Maryland's Transportation Trust Fund is mostly funded by the sales tax exemption on gasoline and automobiles, it is an overstatement to say that the fund is being "raided". In reality, the general fund is being raided to subsidize the transportation trust fund, but the magnitude of that subsidy was reduced somewhat.

If the 6% sales tax were applied to gasoline and new cars, with none of the proceeds going to the transportation trust fund, then you would have a valid point.

@NeilB. I doubt SB 509 will go anywhere with MoCo as the sole beneficiary.

[T1]

@Jim T: Maryland's TTF is largely funded by the current gas tax of 23.5 cents per gallon. If you knew the history of the gas tax, you would realize this tax was created in lieu of the sales tax on gas (imagine 5% on 1 gallon of gas in 1999 when gas prices were $1.25 a gallon). O'Malley proposed instituting the sales tax on top of the gas tax citing an inadequate TTF balance. My point was that if you trace back through governors of both parties, you will see the TTF raided by them to cover budget deficits or fund pet projects. For example, O'Malley used the Budget Reconcilation and Finace Act (BRFA) to raid $350 million in 2010 thus depleting the balance. When you add up the raids, you come to well more than a half billion in just O'Malley's terms alone. The problem is he's also committed to spending new money on a Purple Line, express toll lanes, and an expanded Red Line in Baltimroe. If you think a penny of this money will be earmarked for cyclists then you're sorely mistaken. Unfortunately most people don't have the faintest clue how the TTF works, the bond flows tied to ETL being tied to TTF yet separate, etc.

[Jim T]

@T1. Thank you for engaging in a civil dialogue on this question. I think that that, on some level, your argument could be summarized as: The TTF stole the money fair and square, how dare the general fund steal it back.

At one time, the gas tax was several times the sales tax. Compare the 4 cent state tax on gas during the 1960s with 3% of 20 cents/gallon. But even then, gasoline had a special status: Those who buy all other goods (except food) pay a sales tax for the general operation of government, while those who buy cars and gas pay for the roads they use--but not for all the other operations of government. This is quite unique. For all practical purposes, this can be viewed as a subsidy by the general fund of the TTF, to the extent that the sales tax is waived.

Different people have different views about whether user fees should fund things like roads that at one time were often provided by the private sector. But as long as the sales tax is waived, then that portion of the gas tax that would have been sales tax is not really a user fee--you would have had to pay it anyway if you spent your money at a restaurant instead of on gas.

Thus the question arises: Has there ever been a year in which the "raid" on the TTF was greater than what the sales tax on cars and gas would have been without the exemption? If so, that is a true raid on a user fee. If not, then only the value of the sales tax waiver is being raided. Of course, it hurt just as much to see a subsidy with-held as to see one's own money taken; but that is not a raid.

As youi point out, few drivers understand how the TTF works. Thus, most seem to think that the gas tax is funding general operations of government when in fact the general fund pays for the roads to a large extent, through the waiver on sales taxes.

[JeffB]

@Jim T

I found this link 'What to Call the Gas Tax: Not Just Semantics' helpful in clarifying my understanding of the subject.

Once it is understood that the gas tax is really just a plain ordinary tax (and not a user fee) levied for the purpose of improving transportation then we can get to the next level of argument on how best to go about that.

I also agree that one can view the sales tax exemption on gas as a subsidization.

[T1]

@Jim T

I don't agree with that logic. The TTF was segregated because roads were being neglected in favor of other pet projects. (One could also argue to a lesser extend because of corruption-related issues).

Either way, the argument today is that there aren't adequate funds in the TTF. The question becomes why aren't there adequate funds. My point is that it's because of TTF-raiding more so than inadequacy. Whether you find the raiding justified or not is sort of irrelevant to that point. It did and continues to occur on a fairly regular basis.

[Jim T]

@T1. There are not adequate funds for anything, not just transportation. Sales tax revenues are too little to meet what the state wants to fund, even though the sales tax rate has doubled in the last 40 years. One reason is that alot of what people buy is excempt from the sales tax--autos, gasoline, and internet purchases.

So how about this: Subject gasoline and new cars to the sales tax and send those revenues to the general fund, but put revenues from the special gasoline tax (and special auto tax) into the TTF and place it off-limits to the raids.

[Jim T]

@JeffB. Thanks for the link. The PIRG report it mentions is useful. Attempts to quantify subsidies to transportation are very worthwhile. Of course, one must concede that mass transit gets an even greater per-mile subsidy. People who bike or walk to work subsidize those to drive or take mass transit.

I am less enthusiastic about arguments that the gas tax would not be a user fee but tolls are. Neither tolls nor gas cover the whole cost of the highway. And the idea that the gas tax is a fee on gasoline rather than road use because road use is not directly proportional to gas consumption is silly. User fees are rarely proportional to either the cost or value of the service, they are set in a manner that makes them easy to collect. Fat and thin pay the same price for an airline ticket, big cars and little cars the same toll. But almost all gas is used on a road, and almost all cars on the road are using gas subject to the tax.

[Barry Childress]

Transportation financing in Maryland was partially addressed during the 2007 special session. A portion of the sales tax was dedicated to transportation,....
http://dlslibrary.state.md.us/publications/OPA/I/Bumper_Analysis.pdf
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True we are putting some of that sales tax back, but hardly a "raid" of the TTF.