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Delegate Spiegel urges local option for on‑site food and beverage surcharge under A&A tax
Summary
House Bill 9‑97 would allow local governments to add an on‑site food and beverage surcharge under the existing Amusement & Admissions tax (A&A) up to 3%. Delegate Ryan Spiegel told the Ways and Means Committee the measure is an enabling local revenue tool he said could raise as much as $75 million for Baltimore City.
Delegate Ryan Spiegel (sponsor) described House Bill 9‑97 to the Ways and Means Committee as a modify‑and‑enable bill that would allow counties and municipalities to adopt a surcharge on food and beverages consumed on site under the A&A (amusement and admissions) tax up to a maximum of 3 percent.
Spiegel said the change is aimed at giving local governments additional options to raise revenue as state costs shift to localities. He emphasized the bill is enabling only: local leaders would decide whether to adopt the surcharge and would be accountable to residents and businesses. He and his staff presented examples including Ocean City, which currently has a 0.5 percent A&A tax on food and beverages reserved for the convention center, and a field‑price comparison that showed the maximum 3 percent surcharge in Bethesda would roughly equal the price level in nearby Arlington, Va., under the sponsor's illustrative example.
Committee members pressed technical and policy questions. Delegates asked whether catered events would be captured, how the surcharge would be applied to hotels, and whether the cost would be borne by customers. Spiegel and his staff (Mr. Fiore) said the bill excludes groceries and takeout, and that carryout and grocery purchases would not be subject to the surcharge. They noted an updated fiscal note was being prepared to account for administrative fees that the comptroller can charge. Spiegel said the surcharge is targeted at on‑site consumption and would not be imposed statewide automatically.
Several delegates raised concerns about regressivity and competitive impacts for local businesses, noting alcohol tax stacks and the combined tax rates in neighboring jurisdictions. Spiegel responded that local governments remain accountable to residents and that other jurisdictions already operate similar local taxes. He also noted Baltimore City estimated a potential revenue gain of up to $75 million under the measure.
No formal committee action or vote was recorded at the sponsor‑only hearing. Technical clarifications were requested and staff said they would follow up on questions about catered events, carve‑outs for nonprofits, and exact administration procedures.
Why it matters: the bill would give local governments a discretionary, targeted revenue option for on‑site food and beverage sales; the measure was discussed at length and drew a number of questions from committee members about implementation and local impacts.
