Pay now or later

On March 14, 2012, in Blog, by Matt Verghese

As Governor O’Malley testifies to the General Assembly on his bold plan to increase infrastructure investments, I wanted to make sure you saw this Baltimore Sun editorial.

KEY POINT: “Keeping taxes at 1992 levels will slowly strangle commerce in this state — if not today then not long down that road of neglect and deprivation.”

Gas tax: Pay now or later

Our view: Maryland gas tax proposal may unpopular, but the outlook is far worse if state does not invest sufficiently in roads, bridges, public transit and other vital transportation infrastructure.

Over the past month, the average price of a gallon of regular unleaded gasoline has increased 25 cents in Maryland. As far as anyone can tell, the motorists of this state received no particular benefit from the change in price — aside from a lighter wallet or purse.

Gasoline prices may rise higher yet, as they often do in the summer months when demand increases. Or, if the political tensions with Iran and its nuclear program dissipate, prices may actually go down as fear of supply interruptions diminishes. The marketplace is not always predictable, and there are a host of other factors that might intervene.

Yet Gov.Martin O’Malley’s proposal to apply a 6 percent sales tax on gasoline phased in over three years (and delayed if retail gas prices rise precipitously), that would pump billions of dollars into local transportation construction projects to reduce congestion on the highways, promote jobs and economic development in this state, and provide public transit alternatives is getting little-to-no traction in the General Assembly so far this year.

Why? Clearly, people don’t want to pay more at the pump no matter what. But the problem with this knee-jerk reaction is that not paying a bit more for gas now ensures only that consumers will be paying a lot more later — and not just at the local filling station.

Maryland needs to maintain decent roads and transportation infrastructure or its businesses and citizens suffer. From the Port of Baltimore toBaltimore-Washington International Thurgood Marshall Airport and the highways, tunnels, bridges and rail networks, the state’s economy depends on maintaining and expanding these vital connections to the rest of the country and the world.

The state has not raised the gas tax in two decades, and the alternative methods of funding transportation, the various fees and taxes applied mostly to vehicles and drivers, have been exhausted. What Mr. O’Malley has proposed would add about 6 cents to the cost of a gallon of gas this summer, or 18 cents in three years based on current prices.

No doubt some people find that prospect distasteful. Yet they should find the cost of doing nothing even more unappetizing. Just because it’s more difficult to precisely calculate the cost of getting stuck in traffic — or unsafe roads or lost productivity or a reduced quality of life — doesn’t make them any less burdensome than higher prices at the pump.

The public isn’t always mindful of this, but lawmakers must be. To his credit, Governor O’Malley is undeterred and will appear before House and Senate committees on Wednesday to make his case for higher gasoline taxes. He will be joined by a host of business and labor leaders, elected officials including Baltimore MayorStephanie Rawlings-Blake, and experts in transportation policy.

It would, of course, be easy for legislators to reject such an unpopular measure, but in doing so they would be doing their constituents no favor. There is always an excuse to avoid this necessity. When the economy is down, they don’t want gas prices to make it worse. When the outlook is better, they don’t want to slow down a recovery.

The Baltimore-Washington area already suffers from some of the longest commuting times in the nation. The public transit systems are in danger of failing if sufficient investments are not made soon. Keeping taxes at 1992 levels will slowly strangle commerce in this state — if not today then not long down that road of neglect and deprivation.

The motoring public’s view of this is not entirely rational. Witness the blame heaped on President Barack Obama for oil prices that are beyond a nation’s (let alone a president’s) control. Never mind that Maryland’s 23.5-cent gasoline tax represents less than one-fifteenth of the cost of a gallon and prices are set largely by global demand and supply.

The administration is clearly open to making the proposal more politically palatable — whether that means a constitutional amendment to protect the Transportation Trust Fund from being tapped to finance state general fund deficits, phasing it in over a longer period, deferring its start until 2013, and on. The governor has already proposed a delay in the increase should prices rise 15 percent or more, and aides say he’s willing to make this “circuit breaker” stricter still.

Reluctant lawmakers ought to be willing to meet him at least halfway. Otherwise, they had better be prepared to explain to voters why traffic is gridlocked, economic engines like Montgomery County’s I-270 corridor are at risk, and convenient access to trains, planes, and buses is drying up — along with the economic vitality of the state.

To learn more about why we must address our transportation needs today and can’t kick the can down the road click here.

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The Verdict Is In

On February 24, 2012, in Blog, by Matt Verghese

With a growing population and an aging system of roads and bridges, we have to make the right choices today to invest in our future and stop kicking the can down the road.

But hey, don’t just take our word for it. Here’s what others are saying:

Belling the No-New Taxes Cat
New York Times
“Credit Gov. Martin O’Malley of Maryland with political courage in daring the Legislature to face up to the state’s neglected roads and transit need by, yes, raising the gasoline tax.” “Mr. O’Malley … bucked the no-new-taxes delusions with a blunt reminder that, sooner or later, taxpayers must pay for the services they enjoy.”

Give O’Malley credit for courage on taxes
Robert McCartney, Washington Post
“For me, raising the gasoline tax is a no-brainer. The state desperately needs money to maintain and improve roads and mass transit, not to mention build the light-rail Purple Line.”

The cost of transportation
Baltimore Sun
“If Maryland continues to embrace a 1992 tax rate, it will have to settle for crumbling 1992-era infrastructure.” “Higher prices at the pump may be unwanted, but a deteriorating transportation system is costly, too. Not only in mere congestion but also in lost economic opportunity. Raising the gas tax is the right thing to do today if Maryland is to preserve its quality of life tomorrow and for the next generation.” 

Maryland needs a gas tax hike to fund transportation needs
Washington Post
“At this point, Marylanders … are not paying for the roads they’re using.” “Opponents say … that people don’t want to pay more. Fine. But then where would they find the hundreds of millions of dollars annually that no one disputes is needed to build and maintain an adequate transportation network.”  

The verdict is unanimous: investing in infrastructure is the right thing for Maryland’s future.

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