Raley Proposes Energy Tax Cut In Final Days of Budget Debate

By Guy Leonard, County Times

LEONARDTOWN, Md. (May 22, 2008)—St. Mary’s County Commissioner Daniel H. Raley (D-Great Mills) said cutting the energy tax rate in half makes good fiscal sense for the county, since it would provide citizens with some tax relief but still leave the government with enough money to fund key operations and projects.

Current county projections for the coming fiscal year show the energy tax, which places a tariff on electricity and gasoline consumption, would bring in $3 million in revenue.

Raley said that number should be cut down to just $1.5 million.

“There’s a general sentiment that the citizens need some tax relief, but focus has been on the property tax; with our property tax rate the fifth lowest in the state there’s not much we can do with that.

“The energy tax affects pretty much everybody, not just homeowners.”

Raley said lowering the energy tax rate would “not be as glamorous” as lowering the rate of property taxes because the savings would be on a monthly basis.

But the benefits would be significant, he said.

The commissioners are expected to vote on the final form of the fiscal year 2009 county budget May 27. The total county operating budget now stands at about $337 million.

Commissioner Lawrence D. Jarboe (R-Golden Beach) has said he would support reinstituting the constant yield tax rate, which would reduce the property tax rate to keep up with rising assessments, ensuring residents would continue to pay the same amount.

Raley said returning to a constant yield tax rate would endanger the county’s ability to fund important projects and functions, and would push the county to cut funding for positions.

He added that the constant yield option could take away as much as $6 million to $7 million from the county’s operating fund.

The cut in the energy tax rate made more prudent sense, he said.

“It puts $1.5 million in tax relief back to the citizens of St. Mary’s County,” Raley said. “Would I like to do more? Yes, but I have to keep in mind what’s facing me next year.”

He said the county will have to consider funding new positions at the school being built by the Board of Education in Wildewood as well as funding possible pay increases for unionized employees in the school district.

A new county detention center expansion and new wellness center at the College of Southern Maryland are also expenditures the county will have to help fund in the next year to two years, Raley said.

He also added that numerous public safety grants the county had applied for were not guaranteed.

“If those grants don’t come through, we’ll be on the hook to pay for some of that,” Raley said, adding that he believes his proposal will make it into the final budget to be approved next week.

“I’m hopeful based on comments I had today,” he said.

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