CA officials disagree over imposing cap

Assessment limit poses implementation question

Approval linked to state bill

If Pendergrass measure fails, next step unclear

February 29, 2004|By Laura Cadiz | Laura Cadiz,SUN STAFF

Columbia residents, facing a big jump in annual property charges, could get a break worth hundreds of dollars if state legislators approve a 10 percent ceiling on rising home assessments.

But if legislators reject that plan, no one is sure what will happen. Some Columbia Association directors say the savings could evaporate. Others say the 10 percent annual cap will be put into effect anyway.

For property owners, it's a costly issue.

Under the new rate and annual limit, a 40 percent increase in value on a $200,000 house - to $280,000 - would trigger charges of $748, $822 and $905, phased in over three years.

Without the 10 percent cap, the same homeowner would pay $952 in each of the three years.

The difference: $381 over the three-year period.

The 10-member Columbia Association board dropped the rate for the annual property charge by 5 cents - to 68 cents per $100 of valuation, assessed on 50 percent of the home's value. That was part of the association's $50.5 million operating budget for fiscal 2005.

When the board approved the budget Feb. 19, it included the annual cap on rising property assessments. Now some directors say the cap will take effect regardless of the legislative action on Del. Shane E. Pendergrass' bill proposing one.

"There was no contingency placed on the budget [saying] if Shane's legislation doesn't pass, this is null and void," CA board Chairman Miles Coffman said. "There is nothing like that on there."

If Pendergrass' legislation fails, the board will have to discuss how to proceed, he said. "In reality, the board can pass whatever it wants to do."

Pendergrass, a Democrat, submitted legislation this month in response to skyrocketing residential property values: east Columbia assessments increased an average 33 percent last year, and west Columbia assessments recently jumped an average 47 percent.

Some board members say the association cannot legally impose a cap on collecting assessment revenue or phase in a change in assessments unless Pendergrass' bill is approved. They point to CA's covenants, which state the association must collect the highest valuation placed on the property.

Those rules can only be changed by unanimous approval of property owners. Pendergrass has submitted another bill to allow a majority of voting property owners to alter association covenants.

"We drafted the budget assuming that the [assessment] legislation was going to pass," board member Wolfger Schneider of Harper's Choice said.

Board Vice Chairman Joshua Feldmark said that although the budget includes a 10 percent cap, "if the legislation doesn't pass, we can't do it. If Miles wants to go forward and do it all, the law be damned, I might even back him up on it."

Board member Barbara Russell of Oakland Mills called Coffman's stance on the 10 percent cap "misleading."

"I don't know why he would say that, except that I feel there's a very strong effort to defeat the legislation," she said.

Board member Pearl Atkinson-Stewart of Owen Brown has a different interpretation of the situation. She said CA can impose the cap, but is not legally permitted to phase in the change in assessment over a period of years.

"We can cap it," she said. "We could have capped it at 20 percent."

Now that the board has approved a 10 percent cap, Atkinson-Stewart said, the Pendergrass legislation is unnecessary.

CA staff maintain the budget allows for the cap and phase-in period as long as there's a legal basis to do it.

"The budget provides the funds, assuming that we have the authority to collect in that manner," said Keisha Reynolds, an association spokeswoman.

Board member Cabell Greenwood of River Hill said the board is committed to implementing a 10 percent cap, and if Pendergrass' legislation fails, "we have to figure out a way to make [the cap] happen."

"I don't believe the budget is contingent, I think the cap is contingent," he said. "But I believe there is a responsibility on the board, should the legislation fail, that we have to resolve this."

This is the second time the board has been unable to reach a consensus about its actions regarding Pendergrass' bill. Last month, the board voted to ask her to change the legislation so it would be voluntary, and she refused. A week later, a motion to accept Pendergrass' legislation failed, 5-5.

Now the board cannot agree on its final stance regarding the legislation and cap.

"Even those of us who are against Shane's bill are against the way it's stated, not the legislation," Coffman said.

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