ANNAPOLIS — Maryland lawmakers and business owners are questioning Gov. Martin O’Malley’s proposal to give a $3,000 tax credit to businesses for each unemployed Maryland resident they hire.
“Let’s say I laid off half of my staff,” Del. LeRoy E. Myers Jr., R-Washington, said Thursday in a House Ways and Means hearing. “Why would I want to hire them back for $3,000, if I have no work for them?”
Tony Passaro, a small-business owner and father of six from Belair, testified to that reality before the committee.
“My business is failing,” he said. “I’m down 50 percent in revenue; therefore, I’ve laid off 50 percent of my employees. How in God’s name is a tax credit going to give me the demand I need to hire people back?”
The tax break would be awarded on a first-come, first-served basis and it would be capped at 83 hires per company. It would cost the state $20 million — $19 million from the state’s general fund and $1 million from the capital budget.
Committee chairwoman Sheila E. Hixson, D-Montgomery, said it seems backward that the credit would take money from the capital budget, which supports the construction projects that create hundreds of jobs in Maryland.
Churchvilleresident Bernadette Zgorski said her husband works in commercial construction, and he has been out of work for six months.
“The tax credit will not work,” she said. “There’s no work out there. If there’s no work, no one is going to hire.”
She said the stimulus money that funded construction projects in her district last year went to out-of-state union contractors.
But Stacy Mayer, O’Malley’s deputy legislative officer, said the economy would rebound and generate demand, and the tax credit would reduce the risk for businesses wanting to hire. She cited a host of Maryland businesses in support of the bill.
One of those businesses was Comcast Cable, whose testimony prompted lawmakers to be concerned that the tax credit would favor large corporations already hiring, leaving small businesses with the short end of the stick and little incentive to grow.
“There are ways to target small businesses, and I’m not convinced that this does it,” said Del. Ronald A. George, R-Anne Arundel.
