Neall's tax cap brainstorm ANNE ARUNDEL COUNTY

December 04, 1992

The thousands of Anne Arundel residents who voted in favor of a property tax cap can't accuse County Executive Robert R. Neall of ignoring their mandate. He was opposed to the tax cap -- and still believes it's the wrong route to slimmer government -- but that is not stopping him from giving voters what they want.

The executive has come up with a smart idea that targets tax relief at homeowners without costing the county more money. One myth about the tax cap that voters embraced a month ago is that it would reduce individual tax bills. In fact, it only limits the total annual increase in property tax revenues the county can collect. Individual tax bills, which are based on assessments, could still go up as much as 6 percent.

While the county has no control over assessments, the state does require counties to limit the amount of assessment increases that can be taxed, up to 10 percent. Mr. Neall figured that by reducing Anne Arundel's assessment limit from the current 10 percent to 4 percent, many homeowners would actually see a tax cut.

Lowering the assessment limit does not add to the $10 million the county will lose under the tax cap, it just redistributes the losses so they benefit homeowners more than big commercial property taxpayers.

As the tax cap amendment is written, businesses such as Westinghouse and BG&E would reap the biggest windfalls. If the assessment limit is approved, they still get a break, but not as big as they would have. That is because the county can soften the additional loss from the lower assessment limit by not reducing the property tax rate as much.

Even Bob Schaeffer, who crafted the tax cap amendment, begrudgingly gives Mr. Neall credit for his proposal. Of course, he can't resist noting that Mr. Neall provided taxpayer relief only when forced.

In Mr. Neall's defense, however, the difficult economic times this county has faced since he took office make it hard to fault him for not moving more quickly to reduce reliance on the property tax -- the county's only consistent revenue source.

The county executive may be acting because he has to, but he deserves credit for making this tax cap work even more effectively than its proponents imagined.

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