Higher income taxes likely

Sources say Robey to include rate increase in budget plan tomorrow

Teacher pay raises a priority

Current 2.45 percent levy is state's third-lowest

Howard County

April 20, 2003|By Larry Carson | Larry Carson,SUN STAFF

Howard County residents can expect a higher income tax rate as an integral part of the closely guarded operating budget County Executive James N. Robey is to publicly propose tomorrow, according to a variety of government sources.

With state property taxes due to rise, higher state assessments driving up county property tax bills and many Columbia residents also set to pay sharply higher Columbia Association lien fees, sources said Robey is more likely to ask for a hefty income tax increase from Howard's 2.45 percent rate -- now the state's third-lowest.

The increase may get close to the top legal rate for local governments of 3.2 percent, meaning taxpayers would owe hundreds more dollars a year, starting Jan. 1. The county would get roughly 40 percent of any increase in fiscal 2004, from higher payroll withholding and estimated tax payments, said Raymond S. Wacks, the county budget director.

If the Howard income tax is increased from 2.45 percent to the 3.2 percent maximum, a family with an $80,000 net annual income would pay $600 more in local income tax. At 3 percent, the increase would be $440.

Still uncertain about more state budget cuts, Robey's fifth annual spending plan easily is his toughest because of the competing pressures to pay for what he feels are glaring needs -- such as pay raises for teachers and other county workers -- while revenues are growing so slowly that only tax increases can bridge the gap.

Last month, Robey warned that just to keep up with fixed-cost inflation, he might need to increase the income and property tax rates to raise $50 million more in revenue.

If taxes must rise, "I believe the income tax is the best way to go because it's the most progressive," said Councilman Ken Ulman, a west Columbia Democrat, about his own recommendation.

He and east Columbia Democrat David A. Rakes said they are worried about the effect higher property taxes have on long-term residents and senior citizens, but they, like other county officials, believe teacher pay raises also are very important.

Others want to limit higher tax bills.

"I'm hoping that we have no tax rate increases," said Ellicott City Republican Councilman Christopher J. Merdon, who added that it is too early to realistically assess what the county can afford.

"I'd certainly like to fund the teachers' salaries," said western county Republican Councilman Allan H. Kittleman. The teachers are due a 4 percent pay raise they negotiated (costing $12 million) as part of a three-year pact with the school board last year. No county workers got cost-of-living increases this year, but higher pay for teachers was a priority for nearly every candidate for public office in last year's elections.

Robey would not say this week exactly what he will do, but he did say, "It would be pretty unfair if the teachers get a raise and no one else does." Whether that translates into 4 percent for all workers or something less is not clear, though a two-stage pay raise -- half in July and the rest in January -- is possible.

What also is unclear is whether Gov. Robert L. Ehrlich Jr. will take another $4 million to $8 million bite from the county's state aid. He has promised to veto a $135 million tax package approved by the General Assembly to fund the state budget, but he has not said when he might do that, triggering more local aid reductions.

However Robey handles the situation, County Council Chairman Guy Guzzone, a North Laurel-Savage Democrat, said his overriding goal is clear. "My interest is to get through this year and maintain the level of service we have and not go backward."

Guzzone said the council will consider cuts, but "if after cuts are made, we're still short millions, a tax increase is going to have to be considered."

Once Robey makes his presentation before a council work session tomorrow evening, the five-member body has until June to make reductions or restore money Robey removes from the school board's request for $330.5 million in local funding. The new fiscal year begins July 1.

County department heads, meanwhile, are waiting to see if the minimal requests they submitted will be funded.

Police Chief Wayne Livesay asked for 15 more sworn officers and several more civilian workers, though chances of getting them are slim.

Library Director Valerie Gross is hoping for $232,000 for 10 more employees to cope with circulation that jumped 50 percent in recent years.

Road resurfacing money is big on Public Works Director James M. Irvin's list, and Recreation and Parks Director Gary J. Arthur is hoping not to lose more than the eight vacant positions already eliminated.

Rakes is championing a $200,000 grant program called Parents as Teachers as part of the push to boost poorly performing students at some schools. "It's worth it," he said.

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