Franchot: Switching Regulatory Powers to a New Agency Would Cost $50M

    The Bureau of Revenue Estimates, an agency under the purview of state Comptroller Peter V.R. Franchot (D), issued a report Tuesday showing that stripping the comptroller’s office of its major regulatory duties would cost taxpayers almost $50 million over the next five years.

    The report, delivered to the Maryland Department of Legislative Services, comes as the General Assembly considers legislation to move the Field Enforcement Division, which regulates alcohol, tobacco and motor fuels, from the comptroller’s office to a new commission under the governor’s authority.

    The legislation is the result of a years-long feud between Franchot and the lawmakers over alcohol policy and regulation – and general mutual contempt.

    The Bureau of Revenue Estimates report found that legislation to move licensing and regulatory functions from the comptroller’s office to a new commission would result in significant operational costs for both the agency and the commission. In addition, the legislation would lead to increased administrative expenses, inefficiency and lost revenues, according to the BRE analysis.

    The report, prepared in advance of bill hearings on Friday, states that changes in longstanding tobacco enforcement policies and procedures could jeopardize up to $750 million in tobacco Master Settlement Agreement funds over five years. And it argued that the bill’s passage could also undermine efforts to preserve taxpayer security at a time when the comptroller’s office is transitioning to a new tax processing system.

    “The impacts of this reckless political power grab are plainly obvious and it has nothing to do with good government,” Franchot said in a statement. “On the contrary, it would cost Marylanders tens of millions of dollars, weaken our regulatory enforcement laws, jeopardize tobacco settlement funds that the state relies on, endanger taxpayers’ security and potentially impact the job security of dozens of hardworking enforcement agents who protect consumers at the pump, crack down on cigarette smuggling, regulate alcohol and go after tax cheats.”

    The Senate bill, sponsored by Sen. Benjamin F. Kramer (D-Montgomery), will be heard in the Education, Health and Environmental Affairs Committee at 1 p.m. Friday. The House version, sponsored by Del. Warren E. Miller (R-Howard and Carroll), will be heard simultaneously in the House Economic Matters Committee.

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    Josh Kurtz
    Co-founder and Editor Josh Kurtz is the leading chronicler of Maryland politics and government. He began covering the State House in 1995 for The Gazette newspapers, and has been writing about state and local politics ever since. He later became an editor at Roll Call, the Capitol Hill newspaper, and spent eight years at E&E News, an online subscription-only publisher of news websites covering energy and environmental issues. For seven of those years, he led a staff of 20 reporters at E&E Daily, which covers energy and environmental policy on Capitol Hill and in national politics. For 6 1/2 years he wrote a weekly column on state politics for Center Maryland and has written for several other Maryland publications as well. Kurtz has given speeches and appeared on TV and radio shows about Maryland politics through the years.