Senate Passes Budget, Alcohol Tax Conference Looms

David Saleh Rauf
Capital News Service

ANNAPOLIS - The Maryland Senate on Tuesday gave final approval to a $14.6 billion state spending plan that includes $75 million in fee increases and banks on tens of millions more in revenue from a new alcohol tax to help shore up education cuts. 

The Senate voted 37-10 to approve the state's budget for fiscal 2012. Two Republicans, Sen. Richard Colburn and Sen. George Edwards, voted for the spending plan that increases a number of fees for things like vanity plates, car titles and filing land records, and restores about $58 million in education cuts to Prince George's and Baltimore. The budget also revamps the state's pension system, which is straddled with $19 billion in unpaid liabilities, and makes changes to the prescription drug plan for state retirees.

The House passed a similar budget last week but did not include any new taxes in its plan. The Senate's proposed alcohol tax will be the biggest single item the two chambers have to reconcile during conference committee. The Senate on Tuesday advanced legislation that would raise the sales tax on alcohol from 6 percent to 9 percent over three years. The plan is expected to generate $29 million in the first year, with the bulk of the money raised in fiscal 2012 going toward schools in Prince George's and Baltimore.

Senate Republicans oppose the idea of funneling money from the alcohol tax to state schools when advocates for the tax originally argued the money would go toward helping the developmentally disabled.

"With this situation it appears we're taxing the entire state ... because they need help with their schools," said Senate Minority Whip E.J. Pipkin.

The Senate is expected to give the alcohol tax a final OK Wednesday. The budget now heads to a conference committee where the Senate and House will hammer out difference between the two spending plans.