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Daily Record: Md. board holds the line on property tax rates

ANNAPOLIS — Maryland property owners will not see an increase in state property taxes in the coming year.

The Board of Public Works voted Wednesday to keep the state property tax rates on real property and property owned by public utilities at the current levels.

“Our administration will remain committed to fiscal responsibility and prudent capital spending,” said Gov. Larry Hogan, one of the board’s three members.

The rate for the coming fiscal year will remain at 11.2 cents per $100 of assessed value. That portion is on top of local and municipal property tax rates.

Utilities will continue to pay 28 cents per $100 of assessed value.

Funds raised by the property taxes go toward repaying state bonds for capital projects.

A large portion of that spending goes toward state aid for local school construction and renovation projects.

During the recent Great Recession, the state pulled cash from dedicated funds, including Program Open Space and the Transportation Trust Fund, to pay for ongoing budget expenses. The state used bonds to replace the cash taken from those accounts, which also caused the state to make larger debt payments.

The state will spend as much as $287 million in the coming fiscal year to offset the bond repayments not covered by the state’s property taxes.

Lawmakers had been asked this year to consider the possibility of a state property tax increase.

“I understand it was just a recommendation, but I was in the legislature for 20 years, when something like that pops up on an opportunity list, it often becomes reality,” said Comptroller Peter Franchot, another board member.

The General Assembly passed a budget for the coming year that contained no income or property tax increases. Those same lawmakers will be looking for additional revenues next year as they attempt to cobble together ways to pay for a massive increase in education spending recommended by the Kirwan Commission.

That plan is estimated to cost $4 billion annually, not including inflationary increases, once it is phased in over a decade.

The implementation of the Kirwan recommendations and the coming search for cash to pay for them comes at the same time that economists warn of an impending downturn in the economy.

“I think raising the state property tax rate would unnecessarily inject uncertainty and instability into the lives of hard-working homeowners, especially with an economic downturn potentially on the horizon,” said Franchot. “I can eliminate the potentially.

There is going to be an economic downturn because one always happens, and we need to be prepared.”

To purchase a reprint of this article, contact reprints@thedailyrecord.com.

https://thedailyrecord.com/2019/04/24/md-board-holds-the-line-on-property-tax-assessments/

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