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GOP maintains plan for Washington County taxes, debt is appropriate

February 12, 2000|By LAURA ERNDE

ANNAPOLIS - On the surface, a plan by state lawmakers to raise taxes and tell the Washington County government how to spend its money seems to go against the party grain.

But the authors, most of whom are Republicans, maintain that their plan for reducing debt and raising money for economic development and tourism is conservative.

Lawmakers have proposed doubling the hotel-motel tax to 6 percent, mainly to raise money for economic development and tourism projects such as a minor league baseball stadium.

Any tax increase is anti-Republican, said Sen. Alex X. Mooney, R-Frederick/Washington.

"I don't know why we want to join the bandwagon of taxing hotels and motels," said Mooney, who recently voted against creating a hotel-motel tax in Frederick County.

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But the Republican lawmakers who back the plan reason that it won't hurt their constituents.

Tourists, not county residents, will be paying the hotel-motel tax, said Del. Christopher B. Shank, R-Washington.

Shank likened the tax to a user fee that visitors should pay it in order to experience Washington County's attractions. The increase amounts to $1.50 more for an average priced room.

Del. Robert A. McKee, R-Washington, sees a room tax as the lesser of all evils.

"When you look at the various taxes that could be raised, this is the one that does the least harm," McKee said.

While more than half of the new money raised by the tax increase will likely be used to build a new stadium in Hagerstown, McKee and Shank say they don't support the $12 million to $15 million project.

If it were up to him, Shank said he would rather see Hagerstown use an estimated $283,353-a-year windfall on a proposed Civil War museum or a downtown arts and entertainment district.

But lawmakers felt pressure from Hagerstown officials and business leaders to keep the stadium plan in motion.

City and county government leaders had suggested increasing the room tax to 5 percent, with all the money going toward a stadium, but that idea did not have enough support within the eight-member delegation.

Shank, guided by the resident Washington County lawmakers, came up with a compromise.

The compromise provides money to help the county government pay down a $9 million debt on its pre-treatment plant. The debt is part of an overall $52.3 million water and sewer debt.

"It is a tax increase, yes. But it's a tax increase that's going to save our constituents money," Shank said.

The debt has been a drain on Washington County's finances.

The county has spent about $1.6 million in general fund subsidies on the Conococheague Industrial Pre-Treatment Plant since it opened in 1994. It has also given $9.77 million in grants to the wastewater and sewer funds.

Lawmakers would require the county to put an extra $400,000 a year toward the pre-treatment plant's principal.

Paying down that debt earlier will save taxpayers money in the long run, Shank argues.

County Commissioner Bert L. Iseminger said lawmakers are dictating the county's financial priorities, which should be the job of the commissioners.

But lawmakers respond by saying the county has been urging them for years to help them with the debt.

"We're doing what we were asked to do," Shank said.

It's not an unfunded mandate, Shank said.

Some of the debt money would be provided through the tax increase. Most would come from a change in tip jar gambling distributions from the Washington County Gaming Commission.

About $250,000 a year would be shifted from charities to the county Fire and Rescue Association, allowing the county to spend less to support the association.

Shank said he feels lawmakers need to dictate where the money will go to prevent government growth.

"If we provide new sources of revenue, I want to be absolutely certain that the money goes to debt reduction, not to grow county government," Shank said. "I feel that the county needs to tighten its belt more when it comes to this."

Del. Joseph R. Bartlett, R-Frederick/Washington, said he doesn't necessarily agree that the debt is the county's biggest priority.

Last week the state offered each county an incentive to increase teacher salaries by 4 percent this year and 4 percent next year, with the state contributing an additional 1 percent each year. Bartlett said he wants to make sure Washington County doesn't lose out on the state match.

"I would be much more open if we were going to dedicate the tax entirely to increase teacher salaries," Bartlett said.

The delegation is scheduled to vote on the plan Wednesday. McKee said he believes there are enough votes to approve the plan.

Right now it appears that Mooney and Bartlett will be the lone dissenters in the eight-member delegation.

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