Linowes panel aims for simplicity, property tax equity

January 20, 1991|By Suzanne Wooton

An article in The Sun Sunday about the Linowes commission's recommendations on property taxes misstated how the 4 percent cap on assessments resulted in Baltimore County. In fact, the County Council enacted the cap.

In addition, the story should have said that if the commission' recommendation to assess at 100 percent instead of 40 percent of fair market value were adopted, Baltimore County's $2.895 tax rate would drop by 60 percent to $1.158 per $100.

When Everett and Margaret Shamburg's tax assessment arrived last month, the value on their two-bedroom row house in Dundalk had jumped more than $16,000.

FOR THE RECORD - CORRECTION

Confused that the value had risen so much in a dead real estate market, the Shamburgs took their assessment and joined hundreds of others at a recent tax protest.

"We just don't understand any of this," said Mrs. Shamburg about the fair market assessment that will go from $47,560 to $64,070 over the next three years, raising their tax bills.

What they wanted was answers. What they wanted even more was relief.

The Shamburgs learned that they will get just that, because of the 4 percent annual cap on assessment increases that Baltimore County voters approved in November. But other areas of the state, not under caps, won't be so lucky.

And the Maryland Commission on State Taxes and Tax Structure, the gubernatorial task force that has studied the state's tax system for nearly three years, says that instead of caps, the state should provide property tax relief for everyone.

The commission recommends reducing property tax rates everywhere, with the greatest relief going to poorer areas like Baltimore with the highest tax rates.

The proposal would allow Baltimore, for instance, to reduce its $5.95 tax rate by 58 cents while Montgomery County could trim its $1.936 rate by only 11 cents. Baltimore County, where the Shamburgs live, would get a more typical break of 16 cents, under the plan.

Along with proposed cuts, the Linowes commission -- named for its chairman, Montgomery lawyer R. Robert Linowes -- wants to simplify the way the property tax is administered so taxpayers can understand how taxes are determined and how they relate to comparable taxpayers.

But the property tax relief is only part of a proposed overhaul, which also would alter the income tax burden in favor of lower- and middle-income taxpayers, increase sales taxes and impose a new personal property tax on cars and boats.

Overall, the Linowes commission believes that a family of four with income under $50,000 will pay less taxes, while those in higher incomecategories would pay more incrementally.

But the total tax tab also hinges on what people own and how they spend their money.

On an icy Saturday morning recently, the Shamburgs and several hundred others filed into the bleachers at the Dundalk Community College gymnasium, past a large sign saying, "Reject the Linowes report."Many stopped to sign the petition beneath the poster.

"We're against it," Mrs. Shamburg said later. "All we're concerned about is the bottom line."

Indeed, the commission's proposed change in property taxes represents the only across-the-board decrease.

While taxes come in many forms, Marylanders scream loudest about their property taxes. Unlike other taxes that are siphoned off paychecks or tacked on at the cash register, property tax assessments land with a thud -- once every three years.

These assessments -- caused by escalating values, assessors insist --have not only resulted in tax caps and protests but so many appeals that the state appeals board recently suspended hearings for January in Baltimore and in Anne Arundel, Montgomery, Prince George's and Baltimore counties.

The Linowes recommendations wouldn't affect how much the asssessments go up. But they would give local governments $180 million next year -- generated by the 21-cent state property tax -- so elected officials could cut the all-important tax rates.

Taxpayer resistance, the commission says, is jeopardizing a critical source of local revenue. And the state needs to take quick steps to quell that rebellion, not only through tax cuts but also with simpler, fairer assessments, it says.

The commission recommends that all property be assessed at 100 percent of fair market value instead of 40 percent, to eliminate the confusing array of numbers on assessment forms. Local governments then would be required to lower their tax rate proportionately so the change doesn't automatically mean a highertax bill.

In Baltimore County, for instance, where the Shamburgs live, that would drop the current $2.895 tax rate by 40 percent to $1.73 per $100. On top of that, Baltimore County could lower that rate with its share of the proposed $180 million state grant.

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