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1806 VETOES
Subsection (a) of House Bill 908 imposes a severance tax "for
the privilege of depleting the natural resources" of Cecil County.
(Emphasis supplied.) The activity sought to be taxed is the deple-
tion of these resources, whether by excavating, removing or quarry-
ing. Thus it appears from a reading of subsection (a) that the tax
is a severance tax, but in subsection (c) the Bill requires the excava-
tor to file a monthly report of the "taxable sand, gravel or stone
excavated, removed or quarried, which has been sold during the pre-
ceding month and pay the tax due thereon". If the phrase "and pay
the tax due thereon" relates only to the resources which have been
sold, it would appear that House Bill 908 imposes a sales tax and not
a severance tax. Thus if this Bill does impose a sales tax, there could
be further questions as to the sufficiency of the title of the Bill and
whether the Bill is directed at a class of persons which is too narrow.
In any case, the Bill obviously lacks clarity as to the legislative intent.
Sincerely yours,
/s/ Francis B. Burch,
Attorney General.
Letter from Maryland Geological Survey—H.B. 908.
April 8, 1969.
Hon. Marvin Mandel
Governor of Maryland
State House
Annapolis, Maryland 21401
Dear Governor Mandel:
I understand that House Bill 908 which imposes a severance tax
on "sand, gravel or stone" excavated or quarried in Cecil County was
passed by the General Assembly on the last day of the 1969 Session.
Although this was introduced as a local bill, I feel that it has far
reaching implications for the State as a whole.
I testified against this Bill before the Senate Finance Committee
on March 21. My reasons for opposition were as follows:
A severance tax imposed by a local jurisdiction is unfair to the
local mineral producer in that it puts him at a competitive disadvan-
tage with respect to other mineral producers in adjacent jurisdic-
tions. Such a tax in one county may lead to the imposition of a
similar tax in other counties. If this practice would become wide-
spread in Maryland it would put the Maryland mineral producers at
a disadvantage with respect to adjacent states. The tax would even-
tually be passed on to the consumer, thus leading to higher building
costs and contributing to the inflationary spiral.
I should also point out that this bill apparently does nothing
toward reclamation of mined lands. A Governor's Commission to
study the supply and availability of mineral resources of Maryland
has drafted a bill (not introduced in this Session) which would pro-
vide for regulation of the mineral industries and also provide for the
reclamation of mined lands. It would seem to me that such a pro-
posal is a much more intelligent and positive approach toward mining
and quarrying than the imposition of a local "nuisance" tax.
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