Merdon Tax Cut Passes Council
Posted by David Keelan on Tuesday, October 31, 2006
It is interesting that Larry Carson sought a quote from Grover G. Norquist. He doesn’t like targeted tax cuts, but Grover is a strict conservative and I would not expect him to like this.
Regardless, other taxpayer organizations liked this a lot. Montgomery County is looking at similiar legislation.
Some of the “policy experts” echoed sentiments on the blogs about how it is poor public policy to create targeted tax cuts. It happens all the time folks. Aren’t 501c’s a forum of targeted tax cuts? You know what I mean.
Anyway, these seniors need help. We need them to stay in Howard County.
The council’s majority Democrats – including Ken Ulman, the Democratic nominee for county executive – tabled the bill Oct. 3 and drew up amendments to limit the benefit to lower-income people, but he backed off yesterday for fear amendments might kill the popular bill.
Calvin Ball sent me a copy of his amendments on October 27th. If you are on his Council distribution list then you did too.
- His amendments pegged eligible income to 80% of the median income in Howard County. A difference of only approximated $2,000 per year in income.
- It stepped in the tax cut to a full 100% when a Senior’s income was 20% or less of the median (I didn’t hear the commission on aging comment on that).
- It would institute an income test
The only significant difference was the stepped in tax cut up to a 100% property tax credit.
This bill passed because it is one week before the election and because it is good policy.
Ulman said that if he is elected executive, he would take another look at the measure.
For what purpose? Can he please clarify? If he doesn’t like it in its current form then he should have voted against it. Don’t accuse Merdon of playing election year politics if you don’t have the courage to vote against a bill and only do so in order to avoid Senior backlash at the polls.
Today is Tuesday, October 31st. Have you seen any negative campaigning today?
Howard County Maryland Blog 
Steve Fine said
This is an awful bill. Its unfair and fiscally irresponsible. Its a prime example of the pols using our money to further their carreers at our cost.
Note the real effects of this bill, it won’t help seniors who are too poor to own property, or those seniors who have sold their property and moved into retirement comminities or in with family. Moreover, some who will get the tax cuts won’t need it. Some of the individuals whose taxes are being lowered are millionares. Most people over seventy’s income is passive. Many people who have more than a million dollars of assets have an income of less than $75,000 per year. It they have invested intelligently, they are making money that is not counted as income (For example stocks are real estate that have appreciated, but have not been sold). (Moreover 7.5 percent is not a bad rate of return on safe income producing assets in this low interest environment).
But why are we only helping seniors? Are their not other groups who are equally affected by the high cost of living? For exmple, the poor, the disabled? Why is it more important to keep seniors from moving out of the County than these people?
Finally, this loss of revenue is going to come from somewhere, right now it looks like it will be coming from public employee’s retirement funds.
(To be cross posted at fineline).
Hayduke said
My problem isn’t so much giving a tax cut to those who actually need it. Rather, it was the explicit and oft-stated claim that we need to keep seniors in their houses because we don’t want young families moving in — they cost too much.
It’s social engineering on a budget, reducing the total worth of residents to their financial impact on the county.
And it’s painfully cynical.
Jim Adams said
Excellent point Hayduke, soical engineering on a budget.
I believe the question is, are we looking for cost savings, or are we looking to benefit, tax-wise, the citizens who live in Howard Co.The cost savings may just be an additional benefit. It is the orginal intent that I would find most interesting, and I believe it is a tax cut for current citizens.
If we were to be cynical (of course I don’t want to be)and say this is social enginerring for cost savings, it would be my belief that this would be temporary, the market pressures would cause an adjustment.
observer said
If Robey hadn’t jacked our personal income tax to the highest level allowed by law, fewer seniors would be fleeing the county and thus there might not be a need for such a bill. How about that, Robey who cares so much about working families, hammering them with a huge income tax increase. Well it may have been a budget crisis due to a slow economy that necessitated the increase, but now that the economy is humming along and revenues are substantially increased, giving the money back to the citizens who are getting screwed here, is the right thing to do. Just a side note for the socialists who read this— Tax cuts don’t cost the government anything, it is not their money in the first place. COST IS THE HARDSHIP PLACED ON THE CITIZEN WHO IS FORCED TO PAY FOR THE WASTEFUL SPENDING THAT OUR GOVERNMENT CAN’T CONTROL. Robey could repeal the entire tax increase and still provide the same level of services, if only he were a better steward of our local government. I guess he wouldn’t have any money to build a brand new fire academy and a brand new office campus, and other things that he hopes one day might be named after himself. Why don’t we buy a few more helicopters, and don’t forget big pay raises for all the county employees. Who else’s vote can he buy with my tax dollars, did I miss anyone??
Jim Adams said
Your right on the money Observer, spoken like a true Republican. Get the expenses down, the taxes will fall, but before we bring the taxes down too far we may want to look at assistance for disabled, and their caregivers, and other programs directed towards providing for those who may not be able to provide for themselves. This would not cost much, not as much as a new government campus, maybe not even as much as a helicopter. What an idea, lower taxes, improved services for the citizens. If Don Dunn were not running, I would draft you.
Freemarket said
Steve Fine nailed this one in regards to the discriminatory nature of this cut. This cut was clearly done for political gain. That said, I am all for cutting taxes for everyone, along with government spending. Merdon is cutting taxes (for some people) with this bill, while at the same time proposing increases in spending on middle school athletic programs, voicing support for new athletic fields, and voicing support for buying high school freshman laptops. How does he plan to pay for all of this? The entire expectation of increased academic performance based on the sports expenditures is dubious. Furthermore, I have a hard time with the County buying laptops for high schools students when I drive past Glenelg High School everyday and see brand new cars in the student parking lot.
Hayduke said
Who else’s vote can he buy with my tax dollars, did I miss anyone??
I’ve had the same thoughts about Merdon. See, for instance, freemarket’s post above.
Good misdirection, though. Gotta keep things on topic: The Democrats are to blame!
hocomd said
“The Democrats are to blame!”
Not always – give yourself a break. 😉
Fran said
Steve Fine forgot that the poor don’t pay taxes and are not affected by this measure!
Hayduke, this is not so much to do with young, costly, families moving in to the area, but rather helping seniors age in place – something that most seniors desire as opposed to downsizing.
I know Hayduke. Hayduke is just mad that the Dem’s didn’t come up with this first.
Hopefully, more tax cuts are on the horizon for the rest of the population (that pay taxes).
Hayduke said
Fran, nice try. I heard Merdon explicity use the “keep young families out” justification at a candidates forum on Sunday. It’s also mentioned in the article.
You obviously don’t know me if you think I’m really upset that the Dems didn’t come up with this first. I’ve consistently spoken out against these types of special tax provisions on my blog. Heck, who else do you know that opposes the mortgage interest deduction for reasons of fairness and equity? I’m almost libertarian enough to push for a flat tax. Almost.
Fran said
Well, I am libertarian enough to push for abolishing our federal tax code for a more beneficial National Sales tax…
But, regardless of what was said and/or written, the real reason I support this new tax law is that it keeps seniors aging where they want to – in their own home of 20, 30, 40 or more years! Who cares what the politicians are saying as long as policy improves our future!
The only thing I am trying here is to point out that you can’t ever cross the partisan line to emphatically praise Merdon.
I do know you. Liberals are liberals are liberals…
observer said
Hayduke, improving the education of our students is an attempt by Merdon to buy votes? Sounds like a good policy in the making here, benefits all school children. You might think it is frivolous, but it provides a hell of a lot more bang for the buck than two helicopters flying overhead several nights a week, with little or no benefit provided. So how many students under the age of 18 will be voting for Merdon, based on this proposal?? As I remember, Merdon also proposed a balanced budget the year Robey lost control of himself. How many votes was he buying with my tax dollars that he was trying to return to me and other county residents?
observer said
By the way Jim, I think of myself more as a Libertarian, as usual your assessments are wrong again.
Freemarket said
Fran- how does this tax cut improve our future in any way? It is really just a hand out under the disguise of helping those who are less fortunate. I am libertarian enough to want to legalize pot, and you don’t sound Libertarian.
Observer- building baseball fields and giving rich kids computers is not improving education. It is just the perception of improving education, which drives up real estate values, and thus earns votes.
Hayduke said
Fran: Read my archives. You don’t know me, so please stop trying to mischaracterize who I am and what I stand for.
Observer: Freemarket did a good job of summing up how I feel about Merdon’s education proposals. There are tenuous, at best, connections between athletics and education. Meanwhile, laptops for all sounds like socialism or liberal policies aimed at creating a veneer of equality.
Jim Adams said
Hayduke, I would love to know what it is you like to read. I find the way you address a subject very interesting. If you ever have the time to compile a reading list, let me know.
Steve Fine said
The poor don’t pay taxs? I did when I was poor. Why didn’t anyone tell me?
I really meant the least wealthy. Many middle class people can’t afford homes, over one third of Americans rent.
And by the way, all Howard Countians could be affected by the spending cuts, borrowing or fee increases that will result from this taxcut.
Bubba said
to quote the song….
“Don’t you know that less is more”!
Ahhhhhhhhh Less taxes Thank the Republicans!
Fran said
Hayduke: Well, I stop trying because I know when the truth starts hurting. Sorry to raise your blood pressure…
Freemarket: I don’t do drugs. Not all Libertarians do drugs.
Like I said, I hope there are more tax cuts for the rest of us on the horizon…less government is a better government (sound any more like one?).
Freemarket said
Fran, I don’t do drugs either, nor did I say that all Libertarians do drugs. What I meant was that Libertarians, as a group, support the legalization of drugs. Like you said, less government is better government. They are also in support of the legalization of civil unions and prostitution.
observer said
Hayduke, I guess there won’t be any poor kids who get lap tops under Merdon’s program. Sounds like more, “tax cuts are only for the rich”, liberal propoganda. It’s a good idea, were sorry we didn’t come up with it, and oh, we can’t let a republican get any credit for it, so lets demonize it and confuse people with mis-information. I guess if Al Gore wanted to add a $5 per month phone tax so all children get get free access to the internet, you’d be falling all over yourself praising him for his compassion and desire to help those poor underpriveleged kids.
Hayduke said
Is it possible to have a reasonable discussion about the merits of a tax cut without falling back on misappropriated stereotypes, wrongful assumptions and strawmen?
jen said
I do drugs! just kidding. Poor folks don’t generally pay property taxes. This isn’t about income or sales taxes, it’s about property taxes. That said, There is a program in place to assist low income owners of property pay their taxes. The tax break, I believe, can be as significant as 100% depending on income. It is a good program for our seniors that are on fixed income- and have no additional assets. It doesn’t place a lien on the property. Sadly, our fixed income, moderate to low income seniors need help with other costs. In addition to astronomical property costs and increased cost of living, seniors generally have very high prescription medicine bills. They do drugs, but they can’t pay for them.
hocomd said
A reasonable suggestion. Thanks Hayduke.
hocomd said
Jen,
I think that is exactly the type of response Hayduke was hoping for – thank you.
The General Assembly recognized this issue and addressed it by passing legislation to permit local jurisdictions to create these “targeted” tax breaks.
Property Assessments have skyrocketed in Maryland. In Howard County alone property values have shot up 143% in three years. In 2005 some property assessments have gone up almost 100%. The average in Maryland in 2005 was 20%.
If you are a senior on a fixed income with no earning power this takes a huge bite out of one’s savings. If you have a retirement savings account you take out so much a year in order to maintain a certain quality of life. You plan your retirement based on certain assumptions knowing they will change within certain margins. A 100% increase (with more increases every 3 years) is not what most people plan for.
The General Assembly noticed the problem, proposed and passed a fix. Merdon created Howard County legislation to fix it.
I didn’t see any fuss over the Homestead Credit. Why the fuss now?
Hayduke said
Yes, Jen’s response is welcome, and I largely agree with it. As I said up top, it’s not the tax cut per se that I disagree with, but, rather, the use of the “young families are too expensive” justification. Young families may cost the county more in services, but they also tend to pay more in taxes (they are charged the full assessment after purchasing a new home and in order for them to live here, their incomes are likely higher than fixed income seniors). They also benefit our community in other ways, too, such as blogging. 🙂
Jim Adams said
Observer, Kittleman has referred to himself as a Libertarian also, maybe you have observed this yourself.
observer said
Don’t know allen that well Jim, wouldn’t know
Numbersgirl said
Sounds like libertarianism is the flavor of the month when it comes to claiming a political ideology. Unless Kittleman changes his political affiliation, it is nothing but a convenient way to distance himself from the Republican party.
Freemarket said
I think Allan Kittleman does have the pro-free market Libertarian economic philosophy. However, his close affiliation with the two moral Neanderthals, Bates and Miller, lead me to believe that he does not accept the social liberties that Libertarians believe in. So despite what Kittleman may have said, I would not consider him a Libertarian.
Freemarket said
Good point Numbersgirl.
Public Servant said
This is my first time posting something on a blog. I enjoy reading the various political blogs as I like hearing/reading different point of views. I usually take the posted comments in stride any move on. But Observer’s post on October 31st at 11:07am got under my skin. What really got under my skin was his attack on the public employees working for Howard County.
These employees provide services that people either need or want. Yet Observe attacks these hard working individuals who have recieved modest pay raises during Robey’s administration. And even with these modest increases, most county workers can not afford to live in this county on the salary they are paid.
A little history here … The Robey administration provided the first real pay increases that employees had seen since the Bobo administration (1986-1990). But lets also look at why Robey needed to provide these modest wage increases.
During the Ecker(R) administration (1990-1998) employees received only one pay raise in 8 years. Employee wages were further affected when step increases were cut in half, longevity steps were eliminated, overtime time pay was limited or eliminated, starting wages were frozen, employees were furloughed and in some instances layoffs occurred.
The Ecker administration also produced one of the highest property tax increase seen at the time in the county, raised and established new county fees to pay for services the citizens would normally have recieved as part of their tax package and once again hit county employees in the pocket with increased insurance payments and co-pays.
And lets not forgot all the maintance work or equipment purchases that Ecker defrayed in order to “keep” taxes down. This lead to a host of other problems the Robey administration had to deal with when they took office.
I would ask Observer, how much should we pay our Teachers, Police Officers, Correctional Officers, Fire Fighters, Highway Workers, Treatment Plant Operators, Maintance Workers, General Skilled Workers? These are just some of the workers who provide services, educate our children and and attempt to keep aging facilities and equipment operating.
Speaking of facilities, just when should ANY administration begin plans to replace aging facilities. The courthouse is bulging at the seams and aging. The main county office building is fallin apart (even with renovations) with employees cramped into the basement and any other possible spaces that can be found to include storeage rooms being turned into work areas. Add to that, the county is leasing space just to accomadate growth and demands in service.
Observe also attacks the new “PUBLIC SAFETY TRAINING FACILITY” which is sorely needed. For decades public safety departments in the county have had to beg, borrow and steal space from other county agencies and other jurisdications just to provide training to the police, fire, corrections, deputy sheriff’s, 911 operators and security personnel.
Regional training facilities are design to handle the training needs of agencies who can not justify their own facility due to their size. Or to provide specialized training that agencies can not provide on their own.
Could you see the Town of Sykeville, Laurel City, etc… building their own public safety training building for their relatively small public safety forces compared to Howard County?
Howard County has approximately 390 police officers, 300 professional fire fighters and EMT personnel, 150+ correctional officers, 50+ 911 operators and a dozen or so security officers that need to be constantly trained with alot of the training being STATE MANDATED.
With just our numbers, these regional training facilities would be at their max capacity everyday of the year. Right now there is a waiting list to use some of the Regional training facilities. Agencies that have “partial” public safety training facilities have to schedule the use of the Regional facilities a year in advance for the use of a driving/firing ranges or burn buildings.
Building Howard County’s own training facility only makes sense. Providing modest pay raises makes sense. Building new facilities to replace againg facilities makes sense. What does not make sense is what the Ecker administration did and that was to pass the buck to the next person. There has to be a balance between everything and the foresight to plan for the future needs of the county.
I apologize for the long post.
Steve Fine said
Well put Public Servant. Its likely that our public servants will pay for this tax cut. In the form of lost pay increases and having to pay more (or get less) benefits.
observer said
I agree with most of what you say public servant, it was not a slur on the county employees in fact I take offense that you twist my words in such a manner. I don’t know why you take it that way. My problem is that certain groups like the fire fighters and police get more than the other groups because they all are publicly endorsing the guy that is promising them the most money. I am all for county employees getting a good pay increase, I think parity is the solution. Give every county employee the same increase, if the teachers and firefighters get 6%, so should the DPW guys and DPZ guys. I don’t necessarily have problems with new facilities either, but you don’t propose them in a recession budget year. Maybe when you can afford them. Howard County employees salaries are near the top of the ranks when compared to other counties. Only PG, Montgomery, and Balt. City are higher (last time I checked) and the reason they can’t afford to live here is because the taxes are too high. Robey’s 30% increase in our income tax cost most of us between $1500 and $2000 per year. Funny I didn’t notice any better service after the tax increase went through. Also, Robey said he needed to do this as a result of the budget emergency. Well the emergency is over, how about repealing the tax cut. I strongly praise the County employees, they all do a tremendous job.
Numbersgirl said
re: Howard County employees salaries are near the top of the ranks when compared to other counties. Only PG, Montgomery, and Balt. City are higher (last time I checked)
You’ve named just about every county in the central maryland region, which would make Howard County salaries near the bottom of the ranks.
Hayduke said
the reason they can’t afford to live here is because the taxes are too high.
That’s a specious claim. Though the tax rate may contribute somewhat to the affordability issue, there are far greater factors.
By the way, even though the tax rate increased by 30%, didn’t it only go up by about 1 percentage point (like from 2ish percent to 3ish)? If that’s the case, then this statement is true for significantly less than half the county:
Robey’s 30% increase in our income tax cost most of us between $1500 and $2000 per year.
That is, only those earning more than $150,000 a year (1 percent of which is $1500). Median income is about $90,000. And I’m not sure there are any county employees who earn $150,000, though I’m sure a couple are pretty close to that.
observer said
we know Hayduke, you like high taxes, you are a socialist and support the redistribution of wealth. I don’t know where you get the 1 or 2% figure from, the piggyback tax went from 50 to 65% a 30% increase. There are no exemptions from the piggy back tax at the county level it affects everyone who earns income. So what if you make over $150 K a year, maybe those folks earned it, why should they be punished for their success?
Numbers girl, they are only slightly higher, you make it sound like they are magnitudes lower
Numbersgirl said
Hayduke’s figures look right. Isn’t the local income tax rate 3.2%?
Observer- Where are you getting the 50 or 65% figures from?
http://www.co.ho.md.us/DOF/DOFTaxRatesCharges.htm
Numbersgirl said
Local income tax rate is 3.2%
http://www.co.ho.md.us/DOF/DOFTaxRatesCharges.htm
Numbersgirl said
Local income tax rate is 3.2%, not 50% or 65%.
http://www.co.ho.md.us/DOF/DOFTaxRatesCharges.htm
Numbersgirl said
Sorry- internet problem!
observer said
Numbers girl, I was referring to the increase in the piggy back rate, the $1500 number was the number Ulman used way back then to say how it was going to affect the average HoCo family of median income, I could be wrong there but that is what I recollect. My point is still valid, it is a nice chunk of change.