More than 140 candidates pledge to back increase

Politicians typically are loath to raise taxes in an election year, but that's not the case when it comes to Maryland's alcohol tax.

More than 140 candidates running for the General Assembly have signed on to a proposed dime-a-drink tax increase, with an eye toward using the money for health care for childless adults and programs for developmental disabilities, mental health and addiction treatment and prevention.

The proposal, laid out in a resolution sent last month to candidates for all 188 legislative seats, would raise the state's alcohol tax, among the lowest in the nation.

The tax hike would bring in $214 million for the state while saving $249 million in health care costs associated with alcohol abuse, said Vinny DeMarco, president of the Maryland Citizens' Health Initiative, which drafted the resolution. Those estimates are based off a 2009 study by two Johns Hopkins University professors, who found that "alcohol excise tax increases save lives, reduce health care costs, create and preserve jobs, and prevent alcohol-related problems."

Among the 146 candidates to sign by the Aug. 27 deadline were 63 incumbents-- 18 senators and 45 delegates. In addition, 17 candidates who did not sign the resolution supported the tax increase via a Progressive Maryland questionnaire, including Del. Sheila E. Hixson (D-Dist. 20) of Silver Spring, who chairs the House Ways and Means Committee.

But at a time when the nation's economy still is lagging and the state is facing a budget crisis, some lawmakers remain opposed to any tax hike.

"I don't think it's appropriate in this economy to be increasing taxes of any kind," said House Minority Leader Anthony J. O'Donnell (R-Dist. 29A) of Lusby. "People are out of work, small businesses are having hard time keeping their doors open, and increasing consumption taxes will tend to push people across our borders to do their commerce in other states."

Alcohol currently is taxed by the gallon-- 9 cents for beer, 40 cents for wine and $1.50 for spirits. The proposal would raise the per-gallon rates to $1.16 for beer, $2.96 for wine and $10.03 for spirits, or roughly 10 cents-per-drink for all three, DeMarco said. Rates have been stagnant for spirits since 1950, and for beer and wine since 1972.

Del. Sue Kullen (D-Dist. 27B) of Port Republic said she would not vote for an increase to the alcohol tax if revenues were earmarked for specific purposes, even if they are mental health or disabilities programs, which she supports. Kullen noted she could vote for a general increase to the alcohol tax, but not one as drastic as the dime-per-drink proposal.

Kullen, a developmental disabilities consultant and president of the Maryland Women's Caucus, signed onto a bill similar to the proposal last session because it was a caucus initiative, but the legislation never made it out of committee.

The increases seem dramatic "because [current rates are] so low, and it hasn't been raised in all these decades," DeMarco said. "We have to bring our alcohol tax rates into the 21st century."

DeMarco expects continued pushback from a "very powerful" alcohol lobby, but thinks the campaign put on by his and other health care advocacy groups, modeled after a successful push for a $1 increase to the tobacco tax in 2007, will bear fruit in the 2011 session. He cited a recent poll by OpinionWorks that shows 71 percent of registered voters support a dime-per-drink tax increase if its revenues are dedicated to health initiatives.

A number of organizations have endorsed the proposal, including the AARP, National Association for the Advancement of Colored People, the American Heart Association, the National Association of Social Workers, Mothers Against Drunk Driving and the Mental Health Association of Maryland.

"I think we are poised in 2011 to enact this life-saving measure," DeMarco said."We think the Maryland General Assembly will agree with the people of Maryland that it is good policy and good politics."

Though General Assembly has killed proposal for eight years, Frederick commissioner sees value in hike

An effort this summer to win endorsements from General Assembly candidates for an alcohol tax has yielded 140 signatures, potentially giving the tax it's best chance of passing in years, according to the health advocacy group the Maryland Citizens' Health Initiative.

The group wants passage of a "dime a drink" tax to pay for increased health care for the disabled and poor. An estimated $249 million would be generated from such a tax.

Letters asking for endorsement were sent to all candidates for the legislature, though not the gubernatorial candidates. Among those signing the pledge were 18 incumbent Senators and 45 incumbent members of the House of Delegates, including five standing committee chairs and several members of the panels that would consider the legislation. Others who did not sign on have said they support raising the alcohol tax if it's tied to increasing health care coverage.

Lawmakers have avoiding raising taxes on spirits since 1955 and have not been raised on wine and beer since 1972. The tax, assessed at the wholesale level, would mean an extra 60 cents for a 6-pack of beer, 59 cents for a bottle of wine and $2.25 for an average bottle of spirits.

Though few want to talk about raising tax during a campaign season, and others have pledged no new taxes during an economic downturn, the health care group hopes to make the tax a campaign issue.

"We are thrilled that so many candidates, including Democrats and Republicans from all across the State, have already endorsed this life-saving proposal," Vincent DeMarco, president of the Maryland Citizens' Health Initiative, said in a statement. "They know that the public strongly supports increasing the alcohol tax to save lives and fund critical state programs. With this growing support, we are very hopeful that a dime a drink alcohol tax increase for health care and community service needs will pass in the 2011 Session."

DeMarco said the money specifically should be used ahead of the national roll out of health care reform to provide coverage for those with mental health and developmental disabilities, those with drug and alcohol addiction and poor adults without children.

The health care group also says that the tax should help reduce alcohol abuse. A Johns Hopkins University Bloomberg School of Public Health study found that the 10-cent tax would mean 15,000 fewer cases of alcohol dependence.

THE DAILY RECORD

By Nick Sohr Mon, Aug 30, 2010

Health care advocates say they have 146 General Assembly candidates signed on to a proposal that would raise the state's alcohol taxes by a dime a drink.

Their effort was unsuccessful during the 2010 legislative session, when lawmakers swore off tax and fee increases as economically and politically unpalatable.

But, the Maryland Citizens Health Initiative thinks 2011 will be their year. The next election will be four years off and the legislature will face another tough slog to find revenue to raise and costs to cut.

"I think the alcohol tax is going to happen," said Vinny DeMarco, who heads the initiative and lobbied successfully for the cigarette tax increase in 2007. "The support in the legislature is reflective now of the support in the public."

DeMarco's plan would increase taxes on beer, wine and hard liquor the equivalent of a dime per drink to raise more than $200 million. The money would go toward developmental disability services, addiction treatment and prevention, mental health care and health insurance for childless adults--parents are covered under existing law.

Of course, DeMarco's 146 don't guarantee victory. Only 63 (18 senators and 45 delegates) are incumbents. Although they represent a larger piece of the General Assembly than the alcohol tax increase enjoyed earlier this year (there were 49 co-sponsors), they will need help in reaching the majorities in both houses.

And even if support does build for the tax increase, there's no guarantee the money will go where its supporters intend. The $200 million or so will be enticing for lawmakers trying to stretch revenues to cover the state’s costs.

"We want to get over the first hurdle and just get the tax in," DeMarco said. "Then we'll work on the second hurdle of deciding how it will be spent."

If nothing else, supporters say, the state is due for an increase.

Beer and wine excise taxes were set in 1972-- beer at 9 cents per gallon and wine at 40 cents. The liquor tax was last changed in 1955, when it was raised to $1.50 per gallon.

According to figures released by the comptroller's office, the state collected $29.3 million in alcohol taxes in fiscal 2009.

'The Cheap Drunk State'

The "dime a drink" pledge

The Baltimore Sun

Second Opinion Editorial Board Blog
July 20, 2010

Aside from the self-destructive and Walter F. Mondale, politicians don't generally run on a promise to raise taxes. They're more inclined to run from that prospect. So health care advocates probably shouldn't expect to hire extra mail sorters for all the candidates returning pledge forms committing themselves to a proposed "dime a drink" liquor tax increase.

Members of the Maryland Citizens’ Health Initiative are probably aware of this. They’ve not even bothered with the governor’s race and instead directed the campaign entirely at those running for the House of Delegates and state Senate. There are primaries in hardcore Democratic districts where such a pledge might actually make a difference.

Why? Not because candidates necessarily want to raise taxes but because a lot of Marylanders aren't happy with cuts in government services of the last two years. Responsible people worry there aren’t enough tax dollars available to ensure decent health care for the poor, services for the disabled and drug and alcohol cessation programs.

The alcohol tax proposal is probably the most important piece of legislation to be largely ignored by the General Assembly this past session. That taxes on spirits haven’t been raised in 55 years is shameful. Maryland's unusually low alcohol taxes have effectively helped foster alcoholism, drunk driving, spousal abuse and other social ills by enabling excess consumption.

Right now, the state is facing a sizeable budget deficit next year, the product of a record economic recession and a slow recovery. No matter who is elected, leaders in Annapolis will face a familiar choice: cut spending or raise taxes.

If taxes are determined to be the most acceptable course of action (and the demands of rising health care costs alone may necessitate it), is it better to see a modest increase in a sin tax that's been left untouched for decades or a return to those taxes that have been raised before (income, sales, real estate, etc.)?

Naysayers will likely insist on budget cuts, but most of the reasonable trims have already been made in recent years and the state is limping by in fiscal 2011 on the backs of employee furloughs and cuts to local aid. Next on the cutting block is likely to be health care and aid to education, both K-12 and colleges, which together constitute a majority of the budget.

Once those cold, hard fiscal facts set in, a lot of Marylanders (aside from tavern owners and liquor wholesalers, perhaps) will wish they'd elected pledge signers. Just don't expect too many candidates to commit to raising taxes of any kind-or otherwise confront this state's budget reality in a responsible way-between now and November.

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