Council shifts on property rate

CA officials pledge to undo Dec. action on assessments

Columbia

March 09, 2001|By Laura Vozzella | Laura Vozzella,SUN STAFF

The Columbia Council, which repeatedly changed course in its recent search for a Columbia Association president, reversed itself last night on another major issue - how it calculates the local equivalent of property taxes.

Responding to an opinion issued this week by Maryland's attorney general, the council vowed to undo a change it made in December in the way the huge homeowners association assesses property.

The council directed its lawyer to draft a resolution - to be voted on March 22 - to assess property at 50 percent of its value, instead of at the 100 percent called for in a resolution passed Dec. 21.

If approved, the resolution will not affect the amount lien-payers will be charged, but it will close a loophole that the December vote had opened around a long-standing limit on Columbia Association liens.

The reversal was a victory for four council members who had opposed the December change, arguing at the time that they needed more legal advice before taking action.

The about-face also means the council will toss aside private legal advice that cost the association at least $25,000.

"This is probably the best example of the worst decision-making I've ever been party to," said Councilman Vincent Marando of Wilde Lake, who voted against the December resolution. " ... We really fired, and then we aimed, and we're still not sure where it's going."

In December, the council - acting in its capacity as the association's board of directors - voted 6-4 to assess property at 100 percent instead of 50 percent of value. It also cut the lien rate in half, from 73 cents to 36.5 cents per $100 of assessed value.

A lawyer for the council, David H. Bamberger of Piper, Marbury, Rudnick & Wolfe, drafted the original resolution and said at the time that it was needed to comply with the new state Truth in Taxation law.

Under the law, which took effect Oct. 1, local governments will tax residential and business properties at 100 percent of their assessed value instead of at a percentage of that value. The law was intended to simplify confusing assessment notices. It was not supposed to affect the amount taxpayers are charged, because it would be coupled with corresponding decreases in tax rates.

But, in Columbia, such a change has the potential to affect how much people pay, because it creates a loophole to get around the community's limit on assessments.

The association charges an annual property assessment to support recreational amenities and other services for the community's 87,000 residents.

The assessments are limited, under legally enforceable covenants, to 75 cents per $100 of assessed valuation. When the board voted in December to assess property at 100 percent instead of 50 percent of value, it also cut the lien rate in half. That meant Columbians would pay no more on their next assessment bills,

But, some board members warned, the council was free to raise the rate to the 75-cent maximum - doubling the amount charged because the assessment base had been doubled.

Before the December vote, Councilwoman Cecilia Januszkiewicz of Long Reach questioned whether the law applied to the association as a private homeowners association. After the vote, Councilwoman Barbara Russell of Oakland Mills, who also voted against the December resolution, sought a legal opinion from Maryland Attorney General J. Joseph Curran Jr.

In an opinion issued Tuesday, Curran found that the law does not apply to the association, because it is not a municipal or county government.

Last night, Bamberger stood by his original opinion. He said the matter presented complicated and unique legal questions on which good lawyers could disagree.

However, Bamberger suggested that the council follow the attorney general's interpretation, in part because bondholders might be concerned if the association disregards it.

Opponents of the December resolution faulted Bamberger because his original legal opinion was circulated only to three council members: Chairman Lanny Morrison of Harper's Choice, Pearl Atkinson Stewart of Owen Brown and Kirk Halpin of Kings Contrivance.

Stewart, who voted in favor of the December resolution, praised Bamberger, saying he had provided the association with "very, very sound advice" over the years.

Bamberger noted that Columbia lien-payers would have paid the same under either assessment method - though his critics note that the December resolution opened the door for increases in the future.

"Maybe it hasn't been pretty," Bamberger said, "but I don't think anybody's suffered."

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