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Hogan Calls On Franchot To 'Halt Or Minimalize' Pending Gas Tax Increase; Comptroller Says Executive Action Is Needed

BALTIMORE (WJZ) -- In a letter to Comptroller Peter Franchot on Monday, Gov. Larry Hogan called for the state's CFO to "halt or minimalize" the impact of a forthcoming increase in the state's gas tax, saying the price bump is "unconscionable" amid record prices and steep inflation.

"Given shaky oil markets, record inflation, and a skyrocketing cost of living, the continued surges in gas prices are inflicting more pain at the pump than Marylanders can bear," Hogan wrote. "I am calling on you to take immediate action to provide much-needed relief, particularly as citizens of our state begin to plan their summer travels."

"If I had the authority, I'd do it in a quick minute," said Franchot during a press conference at a Mobil gas station in Towson Monday evening. The Comptroller said he spoke with Maryland's Attorney General, Brian Frosh, who said he had no legal authority to increase or lower taxes. 

The Office of Attorney General Brian Frosh confirmed to WJZ Monday, "Franchot does not have authority." 

In addition to collecting taxes and state revenues, the Office of the Comptroller is tasked with regulating the motor fuel industry in Maryland. But increases in the state's tax on fuel are indexed to inflation.

Hogan noted in his letter that bills repealing the portion of the tax tied to inflation (SB 337) and suspending increases through 2024 (HB 1191) failed to pass during the last legislative session.

Franchot, in a written response, said his staff and attorneys have been exploring if he has the legal authority to prevent the increase, which is automatically triggered by state law. Susan O'Brien, communications director for Franchot, said, however, there is no provision allowing the comptroller to unilaterally stop it.

During the press conference, Franchot said, only the Governor or the General Assembly can change Maryland's gas tax. 

"They need to authorize me or someone to stop this regressive tax increase that is scheduled for July 1st...we have the money, we just don't have the political will," he added. 

Without further action, the state's gas tax will go up to 43 cents from 36 cents effective July 1, Franchot said.

"I wholeheartedly agree that at a time when the rising costs of goods and services are imposing even more financial burden on Maryland families and small businesses, increasing the gas tax on our residents is both morally and economically irresponsible," Franchot wrote.

Alternatively, the governor could declare a State of Energy Emergency and suspend the state's fuel tax altogether, the comptroller suggested.

In March, lawmakers suspended the state's collection of its 36-cent fuel tax for 30 days. Franchot had called for the holiday to be extended to 90 days.

On Monday evening, Michael Ricci, Director of Communications from Governor Hogan's office said, they hope "he (Comptroller Franchot) will announce his plan to address the gas tax increase as soon as possible." 

Shortly before the tax holiday expired in mid-April, the average price for regular gas in the state was $3.69 per gallon. As of Friday, the price was $4.61 per gallon, compared with a national average of $4.59, according to figures from AAA Mid-Atlantic.

"Despite record-high gas prices, 35 million Americans - including more than 730,000 Marylanders - are expected to hit the roads this Memorial Day weekend. Our roadways will be as crowded as they have been over the holiday since pre-pandemic, but airports, train stations and bus depots will also be extremely busy, so travelers should plan accordingly," said Ragina Cooper Ali, spokesperson for AAA Mid-Atlantic in Maryland and Washington, D.C.

Funds collected from the gas tax go to trust funds for transportation and the environment. The state used a portion of its $7 billion surplus to cover the losses to those funds during the 30-day tax holiday.

Franchot said the state is in a strong enough financial position to effectively repeat the program.

"My office stands ready to implement a gas tax holiday once again as we seamlessly and effectively did last month," he wrote.

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