Evening star., 1953-02-01
Democrats Act
To Hold Tax Cut
In Maryland
Insureent Group
Seeks ExpIonotion
Of Income Estimate
BY The Assoeiated Press


State income taxes was made by
the nine insurgent Democrats in
the Maryland Senate today.
The move came in the form of
a letter from Senator Melnicove,
Democrat, of Baltimore to State
Budget Director James G. Rennie
asking for an explanation Of the
grossly inaccurate estimate" of
overall State income during the
1953-54 fiscal year.
Senator Melnicove was one of
those dissatisfied Democrats who
fought the long. losing battle
against the nine party line"
Democrats led by Senator Della,
Democrat. of Baltimore over con-
troll of the Senate.
His bloc lost when. after a
week of stalemates, the II Re-
publicans swung their support to
Senator Della and reelected him
Senate president.
Senator Melnicove said he felt
sure the State would get back
in unused funds in 1953-54 much
more than the $50O.000 estimated
in Gov. McKeldin's proposed
budget. For this year, he said,
the Budget Bureau figures $2.-
100000 will be unspent by the
various State departments.
Cites Unused Funds Data.
"If nearly So million of ap-
propriated funds were unused
by State agencies which received
approximately $97 million (for-
1952-53) in appropriations" Sem
ator Melnicove wrote Mr.. Rennie,
"how then can it be conscien-
tiously estimated that a mere
100000 will be unused from q
total appropriation of sos, ,578,-
GIT for 1953-54) by the same
State agencies?"
sc. believe that if rever-
sions and revenues would be more
accurately estimated, it would be
reported that they would exceed
So million. This would permit a
continued Is per cent credit al
lowance on 1852 income taxes,
without the necessity of cutting
or reducing general fund appro-
priations and the services antici-
pated from the several State
agencies"
Senator Melnicove suggested
that if further investigation
showed that appropriations to
the State departments could be
cut, "it would be possible to con-
slider further income tax reduc-
ton"
He told a reported he would
not accuse Mr.. Rennie of "play-
ing politics" with the estimated
income and leftover funds, for
Mr.. Rennie was only doing his
job under Gov. McKeldin, a Re-
publican. ~
May Seek Big Surplus.
But he suggested the Republi-
can administration may be try
ing to build up a big surplus so
that next year-an election year
Gov. McKeldin could make po-
litical gain from a big tax cut.
"It's an old political trick in
of-election years to underesti-
mate revenues" Senator Melni-
cove explained, knowing they
will far exceed the estimates.
Then in 1854 he could anticipate
a large surplus, which the Re-
publicans could employ for tax
reductions.
The State for years has used
surplus funds and unused ap-
propriated money reverting back
to the State to balance the next
budget.
That reversion is what Sena-
tor Melnicove and other insur-
gents want to use to continue
last years income tax reduction.
Gov. McKeldin said the reduc-
ton would not be possible in the
1953-54 budget because the loss
to the State-about So million
would be needed to grant pay
increases to the. State employees.
Whether Senate President
Della and his followers would
support the Sybert- -Turnbull bloc
to which Senator Melnicove be-
longs remains uncertain.
The proposed budget for
1953-54 amounts to $105,371 :
007.64. To meet this all-time
high figure. however, estimated
revenues amount to only $94,-
O17,727.
The difference, $11,353 ,28O.64,
is the anticipated surplus from
the present fiscal year. And ST.
$4,000 of this surplus is in es-
timated reversions from the
State agencies, public schools
and public welfare.
The latter figure is the one
Senator Melnicove and his bloc
want to tap to continue the in
come tax cut. Any actual cuts