Governor calls for higher taxes and shifting teachers' pension in proposed budget

Wealthier Marylanders would pay higher income tax

ANNAPOLIS, Md. - We often hear that it's not easy to live on a teacher's salary, but teachers' pensions and benefits cost Maryland about a billion dollars each year.

"We're probably the only one right now that covers 100% of the teacher retirement costs," said Maryland Governor Martin O'Malley who proposes shifting half of the pension burden or approximately $240 million back to the counties.

The governor suggested school boards may be less likely to make salary concessions in negotiations with teachers' unions if they will incur the impacts on the pension side.

But Harford County Executive David Craig says state mandates like requiring full day pre-school fueled the hiring of more teachers in the first place.

"It will limit the ability to expand the number of teachers they have, which is also one of the things the state has insisted," said Craig, "They're the ones that have changed class sizes.  They went from 25 to 23 for elementary schools.  So that means you have to have more teachers."

The governor also has proposed capping income tax deductions and rolling back exemptions for single Marylanders who make more than $100,000 per year or those with household incomes above $150,000.

"A family of four earning $150,000 would pay $191 more," said O'Malley.

It's estimated one out of five taxpayers would be paying the higher taxes.

The governor's plan makes no mention of a penny sales tax increase or a gas tax hike.

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