Delegation Supports Transfer Tax

Bill Seeks County Levy To Aid Schools, Farmland

February 09, 1992|By Alan J. Craver | Alan J. Craver,Staff writer

Harford's General Assembly delegation has thrown its support behind a bill that would allow the county to levy a 1 percent real estate transfer tax -- raising $4 million a year for building schools and preserving farmland.

Lawmakers voted 5-0 in favor of the plan Friday. The plan was endorsed by the Community Coalition of Harford County, but the Harford Association of Realtors fought the plan.

Carole L. Bowen, the Realtors president, said the tax would driveup the cost of houses as much as $1,000 for a $100,000 home.

"(The tax) is aimed at a certain group. It discriminates," Bowen said. "Just bite the bullet and increase the property tax. That way, it's foreverybody."

The county tax would be in addition to a .05 percent real estate transfer tax collected by the state. About 75 percent of the amount the state collects through the tax in Harford is returned to the county. The county got about $100,000 this year.

State legislators will formally introduce the tax bill in the General Assembly this week, where the measure is virtually certain to gain approval.

Before the county can levy the new tax, it must be approved by the County Council and Harford voters in a referendum question that is expected to appear on this fall's ballot.

"We are not imposing the tax. We are providing the County Council with the enabling power that if they want to establish the tax, they can do so," said Donald C. Fry, chairman of the county delegation.

Fry, D-District 35A, said that if the legislature doesn't act on the tax plan this session, the county would have to wait to establish the program in 1994 -- that's when a referendum can be put on the ballot for the next county election.

Donald Hoopes, president of the Harford Farm Bureau, said that most new houses built in Harford are bought by people moving into thecounty. By charging the tax, new residents would be helping to buildschools and save farms -- two issues greatly affected by growth.

The school system expects to spend about $108 million on school construction, renovations and additions by 1998. The county plans to build14 schools and renovate or enlarge nine others.

Meanwhile, the county hopes to buy development rights to preserve 30,000 acres of farmland. The county has already placed 21,000 acres in the state agricultural preservation program.

"It's an excellent idea," said Bruce Wells, president of community coalition, made up of 100 individuals and 30 civic groups. "But there were concerns expressed . . . especially now, facing the obvious economic difficulties."

The Realtors association sent a letter last month to County Executive Eileen M. Rehrmann, asking her to drop the tax plan, saying the tax would be costly for homebuyers and developers.

"Housing is in a major slump, the economy is slower with no recovery in sight, and in a state where we already have some of the highest closing costs in the nation, we cannot afford an additional transfer tax on top of what we are already facing," Bowen said in the letter.

Bowen also questioned the need fora new farm preservation program. She noted that little land is beingdeveloped because builders are having a difficult time getting loans.

But Hoopes said a county farm preservation program is needed to pick up where the state left off. Over the last two years, Gov. William Donald Schaefer has taken nearly $23 million from the state preservation program to cover Maryland's budget deficit.

Because of the state's fiscal crisis, the county must look for alternative methods to fund school construction and preserve farms, Fry said.

"These are two legitimate needs the county needs to address right now," Fry said. "(The transfer tax) is a mechanism to do that."

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