This Week in MD Policy and the Week Ahead – January 3, 2014

This week’s news focused largely on the implementation of the Affordable Care Act in Maryland and the upcoming legislative session, which begins next week.

Upcoming Legislative Session

• The Baltimore Sun reported on the Howard County delegation’s predictions for the upcoming legislative session, which include:
• Efforts to address the looming $391 million structural budget deficit, which Delegate Guzzone worries will be especially difficult since state lawmakers have already gone after the ‘easy cuts’ when addressing budget deficits from previous years as cuts from Federal sequestration.
• Revisiting the stormwater fee – the Howard delegation’s Republican members have pre-filed bills to repeal it.
•  Raising the minimum wage “as part of a package with tax cuts, to make the deal more palatable to business owners.
• "The Capital Gazette reported on potential proposals to amend or repeal the stormwater fee assessed at the county level. These proposals include delaying the fee, exempting nonprofits and churches, and offsetting the fee with tax credits for environmentally friendly home improvements.

•  The Mark Steiner radio show hosted a discussion of Maryland’s Corporate Income Tax rate with Delegate Jeff Waldstreicher (Democrat, Montgomery County), and Delegate Kathy Szeligar (Republican, Baltimore and Harford Counties). There was no discussion of how a potential reduction of the corporate income tax would be paid for, which we have addressed as an essential aspect of this issue.

• The Washington Examiner reported that House Speaker Michael Busch (Democrat, Anne Arundel) suggested that the General Assembly may expand tax credits intended to boost employment in the cybersecurity industry. Speaker Busch stated that there are not enough people in the state with the credentials to fill the jobs that are available now. A work group led by University System of Maryland Chancellor Britt Kirwan and Robert Hannon, a former head of the Anne Arundel County Economic Development Corporation will submit recommendations soon on how to meet the growing demand for cybersecurity jobs.
• The Daily Record reported that Delegate Curt Anderson (Democrat, Baltimore City) and Senator Jamie Raskin (Democrat, Montgomery County) will submit proposals to legalize, regulate, and tax marijuana. A 2013 analysis by the Department of Legislative Services suggested that doing so could generate $100 million in revenue.
• Following the Montgomery County Council’s vote to raise the minimum wage, the majority of the members of the Montgomery General Assembly delegation have signed a letter of support to raise Maryland’s minimum wage to $10.10 per hour by 2016.

Proposed Legislation

•  HB 50 – Sponsored by Delegate Norman (Republican, Harford County) (and numerous co-sponsors), would repeal the Watershed Restoration and Protection Program, including the requirement that counties establish a storm water management fee.

•  HB 72 - sponsored by Delegate Keith Haynes (Democrat, Baltimore City), proposes to raise the minimum wage to $12.50 an hour.

•  HB 75 – sponsored by Delegates Michael McDermott and (Republican, Wicomico and Worcester Counties) and Michael Smigiel (Republican, Caroline, Cecil, Kent & Queen Anne's Counties), alters the maximum amount of a subtraction modification allowed under Maryland income tax for certain retirement income for residents who are at least a certain age or who are disabled or whose spouse is disabled.

•  SB 47 – Sponsored by Katherine Klausmeier (Democrat, Baltimore County) (and others), limits the applicability of income tax deductions for business property expensing and bonus depreciation.

•  SB 59 – Sponsored by Senator James Matthias (Democrat, Somerset, Wicomico and Worcester Counties), provides a subtraction modification under the Maryland individual and corporate income tax for payroll taxes on employee tips.

Health

• The Baltimore Sun reported on the success of Maryland's expansion of Medicaid under the Affordable Care Act. As we have discussed before, expanding Medicaid will provide access to health care to for Maryland residents and will save the state money.

• The Washington Post told the stories of people across the country that are benefiting from the Affordable Care Act, including Maryland residents that have insurance for the first time in over a decade as a result of the state’s decision to expand Medicaid.

• The Baltimore Sun discussed issues that are likely to arise as changes brought on by the Affordable Care Act go into effect. While health policy experts predict that many will be confused about the nature of their coverage, the piece notes this isn’t much different from the norm; Americans are confused about health insurance generally, as “[s]urveys indicate that many Americans have little understanding of basic insurance concepts such as copays and deductibles.” In addition, the article draws on discussions with health care providers who stated that uncompensated care given to those without insurance poses a greater challenge than issues that may arise from residents that are newly insured as a result of the ACA.

• The Capital Gazette discussed health insurance navigators that assist residents in obtaining coverage through the Maryland Health Connection by “[s]implifying the process and explaining the available health insurance options” in “a variety of places, including libraries, shelters, clinics and even stores.

Workers and Families

• The Washington Post reported on paid family and sick leave, noting that starting this year, workers in Rhode Island will be able to take several weeks of paid leave to care for a newborn, adopted or foster child, or to care for a seriously ill relative. Similar laws exist in California, New Jersey and Washington (though Washington has yet to implement the law), Connecticut. Vermont and New Hampshire have formed task forces to the impact of such policies. The article also notes that the United States is the only advanced economy with no national policy allowing paid family leave. MDCEP has argued for paid sick leave in Maryland and will continue to research this issue in the future.

Budget and Tax

• The Capital Gazette reported that lower gas prices this year have softened the effect of an increased gas tax in Maryland. While the General Assembly raised the state tax on gas from 23.5 to 27 cents per gallon last July, the average price per gallon decreased about 10 cents when compared to 2012.  Revenue from the gas tax is used to fund transportation spending at the state and local level.

• The Baltimore Sun reported on efforts by local governments in Maryland to push state lawmakers to restore hundreds of millions of dollars a year in funding for local transportation projects, which were cut to balance the state budget in the wake of the Great Recession. In the years prior to the recession, local governments received about 30 percent of the money raised from the gas tax and vehicle registration fees, but this was reduced to less than 10 percent in 2010.

Environment

• The Baltimore Sun reported that the Maryland Department of Environment has not been reviewing local enforcement of storm water pollution controls, despite being required by law to do so every three years. According to the Sun, the Department of Environment “hasn't reviewed any locality's enforcement of storm water pollution controls since checking Charles County in 2006” and “[o]f Maryland's 23 counties and Baltimore City, 18 haven't been reviewed since the 1990s."

Coming Up Next Week

•  Monday, January 6: Maryland Nonprofits is hosting a preview of the 2014 legislative session that will bring together public officials, legislative experts, and advocacy leaders to discuss important information about the upcoming legislative session and how it will affect the nonprofit sector. MDCEP Executive Director Benjamin Orr will be speaking.

• Wednesday, January 8: The General Assembly convenes at noon for the first of Maryland’s 90-day legislative session.

• Wednesday is also the 50^th anniversary of President Johnson’s speech announcing the War on Poverty. Johnson’s original War on Poverty included the establishment of key social insurance and safety net and programs such as Medicare, Medicaid, food stamps, Federal funding for education through the Elementary and Secondary Education Act, and Head Start. More recent programs that share the War on Poverty’s goals include the Children’s Health Insurance Program, the Supplemental Nutrition Assistance Program, and the Earned Income Tax Credit. As research by the Center on Budget and Policy Priorities shows, these programs have helped reduce poverty and have had long-term positive effects for families and children. Check back here next week for more discussion of the impact of the War on Poverty.