CA votes against refunding surplus

Board members say they need more information before approving plan

December 14, 2003|By Laura Cadiz | Laura Cadiz,SUN STAFF

HOWARD COUNTY — After the Columbia Association board of directors listened to about 20 residents lobby them to refund surplus dollars collected in assessment revenue or keep the money, the board voted against rebating property owners $2.6 million from the annual charge.

The decision came Thursday night after 1 1/2 hours of public testimony on the issue, with many of the more than 55 residents in the audience wearing stickers reading "fairness input respect," or holding signs with slogans such as "stop liening on us" or "balance the budget, refund the surpluses, lower the rate."

Board member Phil Marcus of Kings Contrivance proposed refunding the $2.6 million that was above the budgeted surplus for 2003. But in a 15-minute discussion that began at 11:20 p.m. - after all but two of the residents who attended the meeting had left - some board members said they didn't have enough information to approve a rebate.

Board Chairman Miles Coffman said the panel needs to determine what amount of money is eligible for a rebate. According to a ruling from the Internal Revenue Service, the association could offer all property owners rebates or credits against assessment charges in years when the surplus is higher than budgeted without jeopardizing the association's nonprofit status.

Initially, it appeared the amount available for a refund would be $2.6 million of the surplus in the 2003 budget. But a report from the association's citizen budget advisory committee presented Thursday night showed that various analyses of the budget result in differing amounts, ranging from $1.8 million to $2.2 million.

The budget committee's report was in response to a study from the Alliance for a Better Columbia (ABC), a citizens watchdog group, which urged the association to rebate $8.7 million from surplus revenue. Kathleen Larson, who heads the association's citizen budget advisory committee, said ABC's report was "well meaning ... [but] flawed."

Joel Pearlman, an ABC spokesman who presented the group's report to the board last month, interrupted the committee's presentation, attempting to refute its claims. But he was not invited to speak. As he approached the front of the board room, Larson stood in front of him, saying he needed to respect the committee's turn before the board. Coffman echoed Larson's reaction.

Coffman also said he couldn't support rebating funds because of legislation that Del. Shane E. Pendergrass has drafted that would have a drastic affect on the association - a bill that would impose a 10 percent ceiling on the change in property assessments. He said the measure presents too many unknowns for the association.

"As long as we've got that legislation out there, outstanding, I am not going to vote for a rebate," he said.

Other board members were concerned about having to refund money to all property owners - including businesses - when not everyone was hit with a large assessment increase.

"I think we need to be fair," said board member Wolfger Schneider of Harper's Choice. "I think the only fair thing is working with the [assessment] rate."

Coffman said the board could still revive the rebate issue for a later meeting, perhaps if more information is gathered.

Pressure on the board to lower the assessment rate or offer rebates has been mounting since the summer, when many east Columbia homeowners realized their property assessments increased an average 33.4 percent after the state reassessed values there last year. That increase led to an extra $2.7 million in assessment revenue - which is based on property values - to the homeowners association.

The board has tentatively reduced the assessment rate 10 cents, to 63 cents per $100 of valuation assessed on 50 percent of the fair market value. The rate will be finalized in the 2005 budget, which the board is scheduled to approve in February.

Thursday night, many residents asked the Columbia Council - which consists of the same 10 members on the board of directors - to do more.

Pearlman urged the council to rebate the money, contending that "CA is charging all of us much more than it needs to service our community."

Henry D. Shapiro of Wilde Lake told the council that CA has been overtaxing residents, leading to surpluses that "put tremendous pressure on you to find ways to spend them."

But other residents lobbied the council to maintain its current assessment rate and not refund any money, explaining the funds should go to preserve Columbia's amenities and open space.

Linda Odum, who used to represent Long Reach on the council, told the group that the association should lower the rate only when CA is debt-free. The association has about $78 million in long-term debt.

Odum said the "services, privileges and amenities" that Columbia offers stem from the annual charge, and lowering the rate now would be like "plucking a goose that produces a golden egg."

Jean Moon, who lives in Harper's Choice, echoed Odum's sentiments.

"We should rejoice at the rise in our [property value] assessment ... [as] evidence that the desirability of our community is still strong," she said.

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