SENATE OF MARYLAND

ANNAPOLIS. MARYLAND 214O1-1991

By Sen. Roy Dyson


[ Senator Dyson's Newletter ]

27 November 1996

It's the old good news, bad news story. The governor recently announced that he
would be proposing a l0-percent reduction in the state income tax rate. That's good
news for all taxpayers and is also good news for the state's economic development
effort. The business community has been saying for quite some time that the state's high
income tax rate is a significant deterrent for business growth and job development.

The governor, however, announced his intent to propose paying for the income tax cut
with a whopping 36-cent hike in the tax on a pack of cigarettes, or a doubling of the
existing tax. That's bad news for the beleaguered tobacco industry, which is still an
important part of Southern Maryland's economy. The governor giveth and the governor
taketh away.

The tobacco industry is the Rodney Dangerfield of Maryland's economy: it just gets no
respect. The attorney general files suit against the tobacco companies, the legislature
imposes strict anti-smoking regulations in public places and now this. Unfortunately the
Southern Maryland legislative delegation, unified in fighting previous anti-tobacco
initiatives, is severely outnumbered and fighting in a sense an uphill battle against the
anti-tobacco sentiment.

It wasn't always that way. In the days before "one man, one vote," Southern Maryland,
when coupled with other rural areas, was able to hold its own at least in the Maryland
Senate. I can picture what an impassioned speech in support of tobacco would have
been like from the late senators Ed Hall of Calvert County and Paul Bailey of St.
Mary's County, both champions of Southern Maryland agriculture. They might have
won the day in their time. We are going to put up a fight but quite frankly the odds
aren't with us.

I guess the governor and some legislators feel that it's easy to pick on tobacco because
of health concerns about it. There is little evidence. however, that increasing the
cigarette tax leads to a decrease in the numbers of persons smoking. What does
happen, however, is that the tobacco manufacturers don't pass along the entire tax to
the consumer. Instead, it is the farmers, the tobacco growers, who get pinched a little
harder and the price paid to them drops even farther.

There are forces at play nationally and even world-wide which would make the future
of the tobacco industry not very rosy. The real long-range answer is for tobacco
farmers to diversify to other products which aren't quite so controversial. But so far
efforts at diversification haven't been all that successful.

I think the time is ripe, whether the effort at increasing the cigarette tax is successful or
not, to start paying some more attention to this diversification need. If that means either
reallocating existing state revenue or providing for increased funding, then so be it.

One potential way to assist farmers is through more aggressive agriculture land
preservation programs. When farmers can get some money in their pockets for
guaranteeing that their land stays in farming, they might be a little more apt to take a few
chances for innovative and alternative agriculture endeavors. When you are worried
about where your next mortgage payment or tractor payment is coming from, you are
more likely to stick with what has put money in your pocket in the past, namely
tobacco.

I would like the farming community to give me some guidance in this regard. What can I
do to help you diversify? What can I do to help you make a decent living off the land?
The answer to those questions not only benefits farmers, but all of us.

If we can retain our open spaces and rural character here in Southern Maryland, we
will have retained a way of life and the beauty around us, key reasons why we are such
a great place to live. We are growing and with growth comes change. But it doesn't
necessarily mean destroying the best of what we have. If that happens there won't be
any good news/bad news scenario. It'll be all bad news.



[ Senator Dyson's Newletter ]