Sensible approach to tax differential Discussion between county and Annapolis off to a better start.

December 20, 1996

THIS YEAR'S nasty battle between Anne Arundel County and Annapolis governments over the city's tax differential is not likely to be repeated next year. Unlike last time when there was little meaningful consultation between county and city officials, both sides have agreed to meet early in the process. They just might come up with an equitable formula that gives Annapolis residents appropriate credit for the city services they finance themselves.

At its heart, the fight over the differential is about numbers -- how much state capital residents should pay for county services such as schools, jails, courts and roads and how much credit should they receive for the city police, garbage and other services supported by local tax levies. Rather than have politicians grandstand on numbers they don't fully understand, as occurred last year, the sensible approach is to give financial officials the first crack at determining an appropriate tax differential.

Annapolis officials love to accuse the county of arbitrarily imposing heavier taxes on city residents. During 1996, the differential was reduced 8 cents from the previous year, resulting in city residents paying on average about $61 more in county property taxes. County officials have countered by saying the rest of the county's taxpayers have been subsidizing Annapolitans because the differential has been too generous for several years.

Taking politics out of the early stages of the debate makes a tremendous amount of sense. Fiscal experts will keep the debate focused on the numbers, not on extraneous issues. Even when two groups of number-crunchers meet, there will be areas of honest disagreement -- particularly when it comes to determining the value of county services such as the jail or libraries.

Asking for help from impartial consultants at the University of Maryland's Institute for Governmental Service or accounting firms may be one way to resolve some questions. To date, Annapolis officials have resisted engaging a third party.

Objective analysis is essential in developing an equitable formula. The two sides need not re-fight this battle every year. A more business-like approach to calculating the differential could put an end to this senseless debate.

Pub Date: 12/20/96

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