Maryland Gov. Larry Hogan unveiled a $1 billion stimulus and tax relief package aimed at easing the economic toll of the coronavirus pandemic, which includes direct payments to “Marylanders in need.”
The RELIEF Act — which stands for Recovery for the Economy, Livelihoods, Industries, Entrepreneurs and Families Act — includes a total of $267 million in direct payments to Maryland residents who qualify for the Earned Income Tax Credit. Families who qualify would receive an additional $750 and individuals will receive $450, Hogan said.
Speaking during a news conference Monday, Hogan said about 400,000 Maryland residents would qualify for the direct payments, which are intended to support the lowest-income Marylanders.
In addition, the package includes $180 million in what Hogan called targeted tax relief for Maryland residents who have lost their jobs by repealing all state and local income taxes on unemployment benefits.
The measure also provides $300 million in immediate tax relief to restaurants and small businesses by allowing them to be able to keep up to $12,000 of sales tax over the next four months, “which will keep much needed cash and the coffers of those small businesses, which enables them to keep their doors open and keep more people on the payroll,” Hogan said.
The relief package must be approved by the Maryland legislature.
Hogan said the measure will be introduced as emergency legislation when the Maryland General Assembly convenes Wednesday, and called on lawmakers to immediately pass the measure.
“I cannot imagine anything that could possibly be more important for the legislature to pass,” Hogan said.
“Every day that goes by without passing stimulus and tax relief package means more jobs that will be lost more families who will lose their homes, and more businesses who will go out of business, and more people that suffer.”
The relief measure is in addition to about $700 million in various relief measures Hogan said his administration has already made available since the start of the pandemic.
Hogan said the funding comes from a variety of sources, including some from the state’s reserve fund, which has been bolstered by a better-than-expected economic recovery, as well as a “small portion” from the state’s rainy day fund.
Hogan’s announcement came after Democratic state officials have repeatedly called on Hogan to spend more on coronavirus relief by drawing from the state’s rainy day fund, which is just shy of $1 billion. For example, Maryland Comptroller Peter Franchot has called on Hogan to dip into the rainy day fund to fund $2,000 stimulus checks to Marylanders.
Hogan said Franchot’s proposal would result in draining the state’s entire rainy day fund.
Regarding the relief measure he proposed Monday, Hogan said, “We believe this is actually getting more money in the hands of more people that need it, and getting it out much faster, without taking irresponsible actions.”
In a statement released later Monday afternoon, Franchot characterized Hogan’s proposal as “passing the buck to the legislature” and said the governor could do more on his own to help struggling residents.
“Over the past several months, I have been advocating for the Governor to utilize the $1.5 billion in reserves gathering dust in our state’s treasury for $2,000 direct payments to low-income families and more funding for small businesses,” Franchot said in the statement. “The Governor’s plan, regrettably, falls woefully short at not only providing the adequate amount families need, but the speed in which it will be distributed.”
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