Montgomery County May Be Pushed To Consider Tax Increase

In an interview this week, Montgomery County Executive Ike Leggett indicated that a property tax increase is likely to offset state funding reductions and lower than expected revenues. As reported by the Washington Post,

Leggett said he will make a final decision after reviewing economic indicators, including income tax revenue projections from the state that are due in the next several weeks. The county faces a shortfall of about $200 million, a deficit that could deepen if revenue projections don’t improve. Also clouding the fiscal picture are budget cuts unveiled this month by Gov. Larry Hogan (R) and potential revenue losses resulting from a tax case that is pending in the U.S. Supreme Court.

An increase in the rate would require an exemption from the mandatory cap required by the county charter.

That cap limits the amount of property tax revenue the government can collect in a given year — it cannot exceed the prior year’s total, plus an adjustment for inflation and the taxable value of new construction. Lifting the cap requires a unanimous vote from the nine-member County Council, which some council members said will not come easily.

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