City Gives Preliminary Approval to Tax Credit for Urban Farms

The Baltimore City Council has given preliminary approval to local legislation that would provide a tax credit to urban farmers. As reported by the Baltimore Sun,

The bill, sponsored by City Councilman William “Pete” Welch, would provide a 90 percent property tax break for urban farmers who grow and sell at least $5,000 of fruit and vegetables a year. The credits, which must be approved by the city’s Office of Sustainability, are good for five years, but can be renewed for a total of 10 years, according to the bill.

The bill needs one more vote before it can become law. Mayor Stephanie Rawlings-Blake as said she supports the legislation.

Although urban farming has grown over the past several years, the bill’s sponsor and others believe the tax credit would provide an incentive to grow more fruits and vegetables on urban farms to drive down prices in the City. Since urban farms are smaller, they would not qualify for an existing tax credit offered by the State.

Maryland Reporter Summarizes Final Fate of Proposed Environmental Taxes in 2015 Session

An April 21 MarylandReporter.com article summarized the final fate of new taxes and fees, mainly in the environmental area, considered by the Maryland General Assembly during the 2015 Session:

Chicken Tax

The “Chicken Tax,” or “Bay Equity Tax,” proposed a five-cent fee on every chicken provided by poultry owners to farmers in the state, totaling an estimated $15 million annually. As proposed, the bill would have shifted bay restoration funding and resulted in a spending cut to cover crops and increased funding for septic upgrades. …

However, the House Environment and Transportation committee gave the bill an unfavorable report and it was withdrawn. …

Bag Tax

The “Bag Tax,” or the “Community Cleanup and Greening Act of 2015,” would ban plastic bags on “most retailers” statewide, with a 10-cent fee put on the sale of paper bags.

“It’s an elegantly simple idea…Over 180 municipalities around the country already do this,” said bill sponsor Del. Brooke Lierman, D-Baltimore City. “They recognize that we are spending millions in clean up costs, cleaning up litter all over our streets, our waterways and our playgrounds.” …

[The legislation] received an unfavorable report by the House Environment and Transportation committee. …

[Bottle Tax]

Also being held back by the Environment and Transportation committee was the “Bottle Tax,” or the “Maryland Redeemable Beverage Container and Litter Reduction Program,” which would create a committee to regulate a 5-cent tax on bottled beverages that could be redeemed if the bottle was returned.

Rain Tax, is it truly a repeal?

Also on the governor’s desk is the repeal of the 2012 Stormwater Remediation Fee, or more publicly known as the “rain-tax.”

“This bill is not perfect, but it does change ‘you shall charge a tax’ to ‘you may charge a tax’,” [Delegate and House Minority Whip Kathy] Szeliga said.

The Bottle Tax legislation was sent to summer study by the Senate Education, Health, and Environmental Affairs Committee. Lierman indicated that she plans to reintroduce the Bag Tax legislation next year.

The article also covered the failure of proposed $1 a pack increase on cigarettes (tobacco tax) and the passage of legislation modifying how the hotel tax applies to online travel sites.

Montgomery Council Considers a Tax on E-Cigarettes

The Montgomery County Council is currently considering legislation that would impose a tax on e-cigarettes. As reported by the Bethesda Magazine, the bill

…would tax distributors of e-cigarettes at 30 percent of the wholesale cost of the products.

The tax would apply to all distributors that sell vaporizers and other products that use liquid nicotine to create vapors simulating smoking to local retailers.

There is currently no government oversight of these products.

The proposed tax in Montgomery County is seen as a way to add a new stream of revenue, according to documents filed with the council. Councilmember Tom Hucker is the primary sponsor of the bill, which is co-sponsored by councilmembers George Leventhal, Roger Berliner, Hans Riemer, Nancy Floreen, Sidney Katz, Marc Elrich and Nancy Navarro.

Legislation Before Congress Would Tie Federal Gas Tax to Inflation

A group of bipartisan representatives have come together to introduce legislation to replenish the federal Highway Trust Fund. The legislation H.R. 1846, the Bridge to Sustainable Infrastructure Act, would tie the gas tax to inflation and create a bipartisan, bicameral Transportation Commission to provide long-term funding of the Highway Trust Fund (HTF).

As reported by Better Roads,

The bill would index gas and diesel user fees to inflation, which officials expect would raise $27.5 billion for 1.7 years. Following this, the act provides for the creation of a Transportation Commission by September 1, 2015, whose function would be to determine “a path forward for sustainable funding, and would be advised to consider all options,” according to a statement on the bill.

It would require Congress to “enact the recommendations of the commission, or any other funding mechanism that achieves at least three years of funding for the Highway Trust Fund” by a December 31, 2016 deadline. Missing the deadline would result in gas and diesel user fees to increase “to a level that would sustain the trust fund for a three-year period.”

Again, if no funding solution is achieved in that three-year period, the user fees would go up to fund five more years of the HTF. Adding these periods of time together, the bill’s sponsors believe 10 years of HTF funding will be provided.

Congressional transportation authorization expired in 2009.  Since that time, Congress has passed a number of short-term measures to continue funding the trust fund. An $11 billion proposal approved in 2014 is set to expire on May 31, 2015. If Congress does not act by that date, no funds will be available for transportation projects.

Worcester County Commissioners Consider a Property Tax Increase

Worcester County Commissioners advertised this week for a 15.7 cent increase in the county’s property tax rate. The current rate is 77 cents per $100 of assessed property value. The advertised increase will yield a rate of 92.7 cents.

As reported by The Dispatch,

The Worcester County Commissioners agreed Tuesday to advertise for an increase of 15.7 cents per $100 of assessment. That’s what it would take to fund the county’s $22 million budget shortfall. Requested operating expenditures for FY 2016 come to $189.8 million, while revenues are only expected to reach $167.5 million in the coming year.

“We have to advertise the difference between the money we have available and the budget request,” Commissioner Bud Church said.

Although this amount was advertised, commissioners have indicated that the increase will not actually be that high.

“I do believe there’s going to be a tax increase but I think it will be between three and four cents,” Church said. “That’s just a guess. We’re mandated to advertise our projected budget and that’s what we’ve done.”

Church said county officials would not fund every one of the budget requests made by county departments.

Commissioner Chip Bertino agreed. He said that being a taxpayer himself, he was going to try to find ways to cut costs so that residents wouldn’t face a substantial tax increase.

“I’m going to work hard so that it’s not that high,” he said.

Wicomico County’s Proposed Budget Maintains Tax Rates, Slightly Increases Spending

Wicomico County Executive Bob Culver released his proposed FY 2016 budget last week. The $129 million proposed budget is slightly more than the current year and maintains all current tax rates. The county executive’s narrative on the budget describes how the budget was constructed.

The FY16 estimated recurring revenue of $122,815,651 will cover our debt service, recurring educational, public safety, pension, health care, general government, culture and recreation, and community development ongoing expenses. In addition, I am proposing the use of $6,184,592 of General Fund prior year revenue to pay for one-time operating costs, pay-go Capital Improvement Plan funding, and minor capital/infrastructure spending bringing the total proposed General Fund Budget to $129,000,243; a change of $266,435 or 0.2% increase over last year’s budget. This increase accommodates a $910,527 recurring expenditure for the Board of Education as a result of State mandated increases in Maintenance of Effort and Teacher Pension funding. It also accommodates $222,288 to fund the County’s commitment to the Fraternal Order of Police (FOP) in accordance with the collective bargaining agreement executed February 19, 2015. In addition this budget proposes the appropriation of $2,837,923 in unassigned capital funds plus the proposed issuance of $15,760,000 of new debt to fund approved CIP projects. Of the proposed new debt amount, $10,558,228 is contemplated for Board of Education priority systemic renovations.

To assist with constructing the budget, county agencies were asked to reduce operating expenses by 2.5%. Agencies exceeded this request and submitted reductions totaling 6.4%.

The County Council will begin its process of holding public hearings with the approval of the budget taking place no later than June 15.

Information on the County Executive’s proposed budget can be found on the county’s website.

Washington County Commissioners Approve Proposed Budget, Hold Line on Taxes

Washington County Commissioners approved two resolutions last week, one to set the county’s property tax rate and the other to give approval to the county’s proposed FY 2016 budget.  The proposed operating and capital budget totals $258.7 million and continues to hold the line on taxes. Property and income tax rates have remained the same since 2001.

As reported by the Hagerstown Herald-Mail,

The balanced $206.9 million general-fund budget holds the line on the county property tax rate, which will stay at 94.8 cents per $100 of assessed value, as well as keeps the income-tax rate constant at 2.8 percent.

Chief Financial Officer Debra Murray went over some final details of the operating budget and the next fiscal year’s $51.8 million in projects contained in the county’s 10-year Capital Improvement Plan during the weekly commissioners meeting on Tuesday.

Education accounts for the largest portion of the general-fund budget at $107.1 million. Law enforcement and emergency services combine to make up about $33 million of operational spending, which is about $2.3 million, or 1.16 percent, more than the current year.

Major projects to be funded under the proposed capital budget include the new Jonathan Hager Elementary School, various road work, facility improvements at Hagerstown Community College and upgrades to county sewage-treatment plants.

Commissioners will now begin to hold public hearings on the budget.

View Commissioner Baker’s Discussion on the county budget here.

Caroline County Proposes Property Tax Increase To Maintain Revenues

Caroline County Commissioners have proposed a two-cent property tax increase to maintain revenues in the upcoming FY 2016 budget. As  reported by MyEasternShoreMD,

Caroline County commissioners agreed to propose a 2-cent increase in the county’s property tax rate in order to produce constant yield, the same amount of tax revenue in the next fiscal year as the current year, due to another drop in county property assessments.

Even though they were able to balance FY2016’s $44.5 million budget without constant yield, commissioners are considering doing so in anticipation of an even tougher to balance budget in FY2017, as the county’s state-mandated contribution to teacher pensions alone will increase an estimated $661,000, but tax assessments are expected to be flat.

If approved, the county’s property tax rate would increase to 98 cents generating an additional $485,000 in revenue.

Additional information on the county’s FY 2016 proposed budget can be found on the county’s website.

Prince George’s County Executive Pushes Budget Plan to Fund Schools

Prince George’s County Executive Rushern Baker is holding a series of community meetings to garner support for his FY 2016 proposed budget, which will increase taxes to provide an additional $133 million for the county’s school system. As reported by the Gazette,

“Everyone wants their property values to go up. That doesn’t happen without great schools, and anyone who tells you otherwise is lying,” Baker said to a gathering of approximately 80 people April 14 at Capitol Heights Elementary School. “This isn’t a tax increase, it’s an investment.”

Baker is pursuing public support for his proposed budget, which includes property and telecommunications tax hikes expected to provide an additional $133 million for the school system above the current year budget.

School system Chief Executive Officer Kevin Maxwell said that additional funding will be used to fund competitive teacher pay, arts and language education, pre-kindergarten expansion, digital literacy and other improvements.

To provide the additional funding, the proposed budget would override a voter approved tax cap that was put in place in 1978. As the county press release on the budget describes,

In FY 2016, real property tax receipts are projected to total $776.5 million, an increase of $127.0 million or 19.6% over the FY 2015 budget. The growth is primarily due to the FY 2016 education revenue package which recommends a $0.15 increase in the real property tax rate from $0.96 to $1.11 per $100 of assessable value in FY 2016.    The County is authorized to increase the real property tax rate based on Chapter 6 of the 2012 Laws of Maryland (Senate Bill 848).  This law allows the County’s property tax rate to be set higher than the rate authorized under the County’s charter.  The bill requires that any additional revenue generated as a result of the higher property tax rate is for the sole purpose of funding the approved budget of the local school system.  The proposed rate adjustment is expected to generate an additional $104.9 million for the school system.  Excluding the additional revenue assigned to the system, the County’s real property tax revenues are projected to increase by $22.1 million or 3.4% in FY 2016 from the FY 2015 budget.

The total county FY 2016 proposed budget is $3.63 billion, a 6% increase compared to the current fiscal year. The general fund would account for 84% of spending. Budget growth is mainly due to proposed rate increases to the real property, personal property, telecommunications and hotel tax rates.

The proposed budget is premised on achieving three primary objectives: (1) achieving academic improvements in K-12 education across all public schools, (2) maintaining the County’s commitment to providing a full range of public services and (3) ensuring our long-term financial integrity.  With these objectives as the foundation, the FY 2016 presented fiscal plan has a combination of spending increases and reductions which include revenue provisions. To watch the Proposed FY 2016 Budget presentation and for more resources and information please go to http://www.princegeorgescountymd.gov/sites/OMB/Resources/Bgt16/Pages/default.aspx.

Additional information on the proposed FY 2016 budget can be found on the county’s website.

Even After “Repeal” Stormwater Costs and Fees To Remain

Among the widely-hyped topics of the 2015 General Assembly session was the so-called “rain tax repeal,” nominally waiving state requirements that ten affected counties impose dedicated fees to target stormwater pollution problems.

The Sun writes of the expected follow-through for the year ahead by the affected counties – who all still bear massive responsibilities under federal stormwater permits, and who mostly will continue to levy fees dedicated to tackle these challenging requirements.

From the Sun:

While the General Assembly agreed to lift the demand that Baltimore and the nine largest counties charge the fees, state law still requires them to come up with the money for projects to safeguard and improve the health of the Chesapeake Bay.

Baltimore County cut its fees by a third. Two attempts to eliminate them in Anne Arundel County fell short. Howard County is waiting at least a year to make changes. And there’s been no move to make any changes in Baltimore City.

Carroll County instituted a $0 fee before the election. Officials there agreed to dedicate a portion of the county’s property tax revenue to stormwater cleanup projects.

Republicans who chafed at being told how to pay for stormwater projects can still claim a victory on principle. Baltimore and the counties still are required to restore streams, plant trees and do other work to fight the runoff of pollution to the bay. But now they can decide for themselves how to pay for it.

Read the full Sun coverage online.

Read MACo’s detailed coverage of the final bill: What’s In the Stormwater Fee Bill?