Charles County Institutes Transfer Tax to Balance FY 2016 Budget

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Charles County Commissioners gave final approval to a $365.7 million fiscal 2016 operating budget yesterday, instituting a 0.5% transfer tax to address the budget shortfall.  As reported by Southern Maryland Newspapers Online,

The general fund was approved without raises to property tax and income tax rates, a county government press release states. The property tax rate was maintained at $1.141 for the county and $0.064 for fire and rescue per $100 of assessed value; the local income tax rate was maintained at 3.03 percent.

To help balance the general fund’s baseline deficit of $7.94 million, an approved 0.5 percent real property transfer tax will be pledged to fully fund the operating costs of St. Charles High School and the school’s incoming fourth class — accounting for $3.9 million of the school system’s MOE excess — as well as stormwater management programs, Director of Fiscal and Administrative Services David Eicholtz said.

The transfer tax will generate an estimated $5 million in revenue. First-time homebuyers will be exempt on the first $50,000 of their properties. An estimated $550,000 will be transferred from the transfer tax revenue and put toward the watershed protection and restoration fund to reduce the stormwater remediation fee by 25 percent.

To close the general fund shortfall, $2.5 million will also be transferred from the county’s Developers Rights and Responsibilities Agreement reserves.

Commissioners agreed to provide the school board $166 million, $4.2 million over the statutorily required amount, and provided one-time $1,500 bonuses for full-time county government employees. School employees will not receive the bonus.

Commissioner’s also approved a $81.7 million capital budget.