Owens mulls higher taxes

Property rate focus

spending requests `enormous,' she says

`It's worth considering'

Slower growth in capital gains expected next year

March 13, 2001|By Scott Calvert | Scott Calvert,SUN STAFF

It's still early, but County Executive Janet S. Owens says she is considering raising property taxes for the second year in a row, causing concern and "shell shock" among County Council members.

"We are a conservative county, but I'm weighing what I'm allowed to do under the tax cap," Owens said. "I'm not ruling out the tax cap piece."

Under the county's revenue cap, the maximum increase allowed would be about 1.6 cents per $100 of assessed value, based on the reconfigured tax rate of 96 cents per $100 of assessed value.

The revenue cap says that the county's revenue from property taxes cannot grow from year to year by more than the rate of inflation or 4.5 percent, whichever is lower.

The old rate of $2.40 per $100 of value was based on 40 percent of a property's assessed value; a new state law requires the rate to be computed using the full value. But the switch in calculation doesn't change the amount people owe.

For a house assessed at $200,000, a 1.6 cent increase would add $32 to the owner's tax bill.

Owens stressed that she has made no decision and will not present her budget until May 1. But she warned that spending requests "vastly exceed" the county's ability to pay for them.

"I just see how bad it is, and it's bad," she said. "The requests are enormous."

The county school board has asked for $594 million for next year, 10.3 percent more than schools received for this fiscal year.

Between now and the end of next month, Owens' staff will fine-tune revenue projections. And she will sift through the myriad funding requests from her department heads.

Councilman John J. Klocko III, a Crofton Republican, was part of a 5-2 majority that approved a 4-cent property tax increase last year. But he said he is not ready to commit to another one.

"I've been generally willing to take increases the cap allows, but not without purpose," he said. "If it's to pay for special things the executive wants, I'm not going to go for that."

Still, he said, "We're going to get into a tighter economic time period, I would think. It's worth considering."

Owens faces a tougher sell with the two council members who voted against last year's increase - the first since 1996, despite the fact that Arundel residents have the lowest local tax bills in the region.

"If she raised taxes [this year], it's because we don't have enough money because we approved too much last year," said Democrat Barbara D. Samorajczyk of Annapolis.

Samorajczyk said the 2000-2001 budget was laden with capital projects the county cannot afford.

Cathleen M. Vitale of Severna Park, the council's other Republican, said she was "shell shocked" to hear that Owens was considering raising the property tax rate.

"I would hope she would certainly sharpen her pencil - make sure we're tight with our numbers and being very responsible with our spending," Vitale said.

Owens said she faces a "daunting" task.

Income taxes, which account for about 30 percent of county revenues, are expected to rise again next year, but only slightly with the stock market sputtering.

"We've had three or four years in a row of very strong capital gains, which the state is projecting much slower growth for," said Frederick Lickteig, assistant budget officer.

Other members of the County Council could not be reached yesterday. Some did not return calls, and one, Linthicum Democrat Pamela G. Beidle, was on vacation.

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