WM. PRESTON LANE, JR., GOVERNOR. 2251

and the counties have been prohibited from taxing the opera-
tion of all motor vehicles. The City, however, receives 30
percent of all revenue from motor vehicle operations all over
the State, and the counties receive 20 percent. The City of
Baltimore cannot expect to receive 30 percent of the State's
revenue from motor vehicles and, at the same time, impose its
own taxes on such operations in addition. It has been said
that when the company changes its operations from rail to
bus, the City loses revenues. This statement -is erroneous.
The fact is that more taxes, in proportion, are collected from
bus operations than from rail operations, and that as con-
versions are made the company pays more both to the City
and the State. The company is bound by contract to pay
the City two percent of its gross receipts from bus operations,
a rate almost equal to what it pays on rail operations, and
in addition it pays gasoline, oil and seat mile taxes, not im-
posed on street cars.

In addition to these considerations, Senate Bills Nos. 127
and 380 contain exemptions in favor of passenger bus opera-
tions with a terminus more than fifteen miles from the City.
This provision allows such buses to operate within the City
free from City jurisdiction, while subjecting the buses operat-
ing within the prescribed area to any tax the City might de-
cide to impose up to nine percent of gross receipts (under
Senate Bill No. 127,) and without limitation as to conditions
under Senate Bill No. 380. This last bill would also give
the City the same right to issue franchises as is now vested in
the Public Service Commission. There is no good reason why
the State should retire from this field, and every reason why
it should continue to exercise its authority; and there seems
to be no valid argument in favor of creating overlapping
authority, with resulting confusion and difficulty for Balti-
more's mass transportation system and the riding public.
Senate Bill No. 126 is an attempt by the City to interfere
with the operation of its ordinance, passed in 1932, fixing

gross and net income taxes on rail operations. That bill
and also Senate Bill No. 127 contain sections attempting to
change State policy and State law as provided in Articles 56,

66 1/2 and 81 of the Code.

On March 25, 1947, I sent a letter to the General Assembly

expressing my objections to all of these bills. Since then I
have given further consideration to the questions involved,
and I have given those interested full opportunity to present
their arguments in favor and in opposition.

I have not changed my views, and the bills will therefore
be vetoed.