ANNAPOLIS -- Lawyers representing taxpayer groups in Baltimore and Anne Arundel counties urged Maryland's highest court yesterday to allow voters to consider whether to impose limits on how much their county governments could raise from property taxes.
The two proposed property tax caps were ruled unconstitutional last month in separate decisions by Circuit Court judges in Towson and Annapolis that were appealed to the Court of Appeals.
The Circuit Court judges ruled in both cases that the measures petitioned to referendum by taxpayer groups usurped the authority of county councils to set property tax rates, a power expressly bestowed upon them by the General Assembly.
"It's the people's right to assure the accountability of public funds," said John R. Greiber Jr., an Annapolis lawyer who argued the appeal of Anne Arundel Taxpayers for Responsive Government. "It's not usurping any power."
Mr. Greiber and Richard W. Drury, a Towson lawyer who represented the Baltimore County group, Citizens for Representative Government, argued that their proposals were valid amendments to their respective county charters and not unlike existing charter provisions mandating that county councils approve balanced budgets.
Lawyers for Baltimore and Anne Arundel counties argued that the proposed tax limits would handcuff county government.
"The very center of the function of home-rule government is budget and taxing power," said Roger D. Redden, a Baltimore lawyer who argued for both counties.
Anne Arundel County's proposal would roll back taxes to fiscal 1989 levels -- an estimated $29.3 million drop in revenue from the current year -- and limit future increases to 4.5 percent or the rate of inflation, whichever is lower.
Baltimore County's would roll back taxes to fiscal 1990 levels and restrict growth to no more than 2 percent each year. If approved, county officials said it would slash $63.5 million from county coffers next July 1.
Both proposals have escape clauses, although Baltimore County's is nearly impossible to meet. In order to impose a tax increase higher than 2 percent in Baltimore County, the issue would have to be brought to referendum and approved by two-thirds of registered voters, a feat which would require a virtual 100 percent voter turn-out.
At stake in the court's decision is not only the future of property tax limits in Anne Arundel and Baltimore counties, but also in Prince George's County and Talbot County on the Eastern Shore. The two subdivisions have 12-year-old laws that limit property tax revenues.
In addition, Montgomery County voters are set to consider three property tax limits on the Nov. 6 ballot, including one endorsed by the County Council. All three proposals might be disallowed by an unfavorable court ruling.
In their questioning yesterday, the seven-member panel appeared to be mulling over the possibility of rewriting the two proposals -- perhaps severing the two-thirds clause in the Baltimore County measure, for instance -- so that they might pass the constitutional test.
The judges also seemed reluctant to rule property tax limits unconstitutional per se, noting several times in their questions that the General Assembly did not try to overturn tax limits in Talbot and Prince George's counties in the intervening decade since they were passed.
"Anything that would reduce government spending would be acceptable to us," Robert C. Schaeffer, president of the Anne Arundel taxpayer group, said after the hearing.
The court faces a Monday deadline in the Anne Arundel case. That is the latest the county's election office can restore the measure to the Nov. 6 ballot. The Baltimore County case already is on the ballot and could be taken off as late as Oct. 5.