Officials to push tax limit plan

Aldermen seek cap of 4% a year on property rate rises

Proposal concerns Moyer

Affordable housing would be a result, backers say


October 13, 2002|By Amanda Urban | Amanda Urban,SUN STAFF

Two Annapolis aldermen will introduce a bill tomorrow that would limit - to 4 percent a year - the amount that an individual's property taxes can go up based on assessment increases.

Aldermen Sheila M. Tolliver and Louise Hammond are pushing the Homestead Tax Credit Percentage bill, which Tolliver says is a way to address concerns that housing in Annapolis is becoming unaffordable. They say the measure would also encourage homeownership in an area with a lot of renters.

"The city council can control the amount of tax burden and keep homes as affordable as possible," said Tolliver, who represents Ward 2.

Every three years, the state assesses property values based on home improvements and recent sales; the next reassessment is expected to lead to major increases in assessments in many parts of Annapolis.

Assessments are used to determine property taxes. The state limits to 10 percent per year the amount that property taxes can increase. Local governments, however, can set a lower limit. Annapolis has a limit of 10 percent.

The Tolliver-Hammond proposal would limit property tax increases to 4 percent a year, the maximum allowed elsewhere in Anne Arundel County.

Without further limits on city property tax increases, Hammond said, "We're going to assess people out of their homes."

The two aldermen say that while all property owners would benefit from their proposal, they say they're particularly concerned about longtime property owners on fixed incomes, some of whom have seen their assessments soar in recent years.

But Mayor Ellen O. Moyer said the proposed limit would mostly benefit owners of more-valuable property because they're the ones whose assessments are increasing the most. Moyer owns a home on the waterfront in Eastport.

"Historically, it benefits me more than anyone," she said. Some property owners, she noted, will see little or no impact because their assessments are not rising.

The city property tax rate is 62.4 cents per $100 of assessed value.

Moyer also is concerned about the potential impact on the budget. She said property taxes are a major source of income for the city, but that with so much government-owned property, about "50 percent of the city is exempt" from city property taxes.

Tolliver said those who see the legislation as benefiting only the wealthy fail to understand how property taxes work.

"This is a uniform tax based on property value. It is not graduated like income tax," she said. Tolliver said the legislation would be "more meaningful" to people with lower incomes, whose housing costs generally take up a larger percentage of their income.

Tolliver added that there would still be revenue growth because assessments are expected to continue to increase.

Under state law, the legislation would need to be passed by Nov. 25 for the changes to take effect in the coming year.

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