Scores gather to discuss plan to fund schools

Robey is seeking to sway legislators on transfer tax

`A sensible solution'

Some lawmakers question figures on new students

Howard County

February 07, 2003|By Larry Carson | Larry Carson,SUN STAFF

About 200 people braved the snow for what became an intense discussion about the best way to pay for Howard County's top-rated school system at a legislative hearing last night in Ellicott City.

"Although I am a Realtor by profession, I come to you tonight as a 25-year resident of Howard County and ask you to raise my taxes," said David Leonard, who advocated higher income taxes instead of raising the real estate transfer tax to pay for new schools.

A plan, pushed by County Executive James N. Robey and Raymond S. Wacks, the county budget director, would raise the real estate property transfer tax from 1 to 1.5 percent. The estimated $10 million in annual revenue would be used to borrow $215 million for school construction over eight years, and then pay off the debt.

The schools are needed to accommodate enrollment growth that is averaging about 1,000 students a year.

Paul Bosworth of Ellicott City said he supports the tax and offered a remedy for Realtors' concerns.

"[The added cost] can be eliminated by a rebate of 1/2 percent of their commission."

Roger N. Caplan, president of the Howard Community College board of trustees, supported Robey's proposal because he said, "I haven't heard any other feasible solution."

College President Mary Ellen Duncan told the legislators that if they do not provide more money for county schools the county will not be able to afford its share of matching funds for a new college building.

Robey said he had nothing new to add to his previous pleas for support. He quoted Yogi Berra, who said, "We've reached that crossroads, and we have to take it."

Several of the legislators questioned county figures, showing that over half of the new students in county schools are coming from the sale of existing homes rather than new ones.

The Realtors questioned the reliability of the transfer tax to produce the revenues Robey is projecting long-term.

But former state Senate President James Clark said the transfer tax plan "seems to me to be a sensible solution to the problem."

Former Realtor Ken Steil said the issue should not be before the legislators at all.

"If I were you, I'd be mad as a hornet," Steil said. "Robey has started a plebiscite on education. This is not about education. This tax doesn't make any sense."

He said everyone in the room is for education. The question is how to fund it.

David Rifkin, vice president of Capital Mortgage Finance Corp., said he moved to Howard County for the school system, but some first-time homebuyers he tries to help are so strapped for cash that they have to cash a paycheck to qualify for a mortgage.

Another Realtor said first-time homebuyers are giving up on Howard County, going to Carroll and Frederick counties instead, where there is no transfer tax.

Last night's hearing in the County Council chambers was designed to give the county's eight delegates and three senators a chance to hear directly from their constituents before their scheduled vote on the proposal next week in Annapolis.

About 35 people attended to address other subjects, ranging from slot machines to a church-sponsored day care center.

Howard County is facing a money crunch that is threatening its ability to keep up with the need for more schools and other infrastructure investments such as road repaving, a courthouse addition, building maintenance, parks development and a new western county senior center.

The big cash surpluses and generous state aid of the late 1990s are gone, while demands for new projects - mainly schools - are rising with enrollment.

Up to 80 new classrooms are also needed by 2007 for state ordered all-day kindergarten, and the school board is asking for another $87 million for school construction for the fiscal year starting July 1.

But the recession has sharply reduced state school construction aid, and Gov. Robert L. Ehrlich Jr.'s budget plan took $6 million in highway maintenance money from the county.

Robey and Wacks have argued that because half the new children clogging county schools come from sales of existing homes, and the other half from new houses, the transfer tax is the perfect way to have those causing the crowding pay for new schools.

County Realtors have opposed the plan because the increase would make buying a home more expensive, raising the cost of a $250,000 home by $1,250 at settlement. Home prices have soared in Howard over the past several years, increasing 29 percent from September 2001 to the same month last year.

And state legislators have expressed reluctance to approve any new taxes. None have taken a firm public position on Robey's proposal.

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