By Adam Pagnucco.
The Montgomery County Republican Party has alleged on its website and through blast email that the county council is “sneaking in” a tax hike. County GOP Chairman Alexander A. Bush wrote:
At a time when unemployment claims in Montgomery County have increased by 4,717% since the first week of March, our County Council has agreed with County Executive Elrich to give notice that they are “considering” an increase in the property tax rate “4.5% higher than the constant yield tax rate [which] will generate $62,978,926 in additional property tax revenues.”
Mr. Elrich admitted in his March 15th budget proposal that the current COVID-19 crisis will exacerbate the decline of income tax revenues in the County. But rather than tightening its belt, like families and private businesses must do, Mr. Elrich asked the County Council to drastically increase property taxes to make up the difference.
I was heartened by the March 16th response from eight of the councilmembers: “this is a time for cautious decision-making, not property tax increases.” And thus, I was surprised by the County Council’s notice on Thursday that they were, in fact, “considering” the full tax increase.
At a time when small businesses throughout the County are closing their doors and desperately hoping to survive long enough to reopen, this proposed property tax increase is obscene. This may be why the County Council has worked so hard to hide it from the public. Thursday’s legally-mandated notice in the print edition of the Washington Post is the only trace of it. The notice is not published online and the Council’s calendar entry for the April 21st meeting makes no mention of it. This notice was allegedly approved at the Council’s March 31st meeting, however (and possibly in violation of the Maryland Open Meetings Act) the recording shows no discussion of this issue whatsoever. In fact, it was approved unanimously – and without any debate – as part of the “consent calendar,” which is reserved for uncontroversial matters.
Is the GOP right? Does this constitute “sneaking in” a tax hike?
It is true that the county executive proposed a property tax hike in his recommended budget that was promptly rejected by 8 council members. But that fact is actually irrelevant to the advertisement taken out in the Washington Post. The advertisement was mandated by state law regarding increases in property tax rates above the constant yield tax rate, which is defined as “the General Fund real property tax rate for the coming fiscal year that would generate the same amount of revenue that was generated during the current fiscal year.” The state law is extremely specific on the wording, style, placement and timing of the advertisement. It even requires that the county send the advertisement to the state to prove that it is following state law.
An excerpt from the county Republicans’ website.
The county’s standard practice is to exceed the constant yield tax rate but to restrict the growth in property tax collections to the rate of inflation, which is consistent with the county’s charter limit. Staying within the charter limit does not constitute a tax hike. In contrast to MoCo, most other Maryland counties lack charter limits on property taxes at all. In times of rising assessments, these other counties can leave their property tax rates constant and their collections can easily rise faster than inflation. (Let’s note that many of these counties are governed by Republicans!)
As to the GOP’s allegation that this notice was somehow hidden from the public, that is absolutely false. All of the details were contained in a staff memo posted in plain view on the council’s website. The memo includes the language of the newspaper advertisement which we reprint below.
This is perfectly consistent with past practice even when the executive is not proposing a tax hike. Here are the council resolutions on newspaper advertisements for constant yield tax rates from 2018 and 2019, when the county executive did not propose and the council did not pass property tax hikes.
And so there is no “sneaking” of any kind. The county followed state law on newspaper advertisements, a requirement that has nothing to do with decisions on tax increases. It would seem that the Montgomery County Republican Party has a problem with the county obeying state law.
There are two possibilities accounting for the Republicans’ argument: mendacity or ignorance. Neither is a good reason for why they should replace the Democrats in power.