Howard County Maryland Blog

Local Politics and Current Events

Worth Consideration

Posted by David Keelan on Thursday, April 27, 2006

When you have some time sit down and read these articles. Maybe a few open minded and forward thinking people will consider bringing a solution like this to Howard County.

Certain caps would need to be put in place so that such a solution would help those who need the help such as seniors and families. The point of this is that it is a great way to help encourage Seniors to age here in Howard County and families to stay in Howard County without getting gouged by higher property taxes when they downsize or upgrade their homes.

Something like this would not be targeted at someone in my situation, but I think the effects on those it would benefit would have long term benefits for everyone in Howard County.

Consider the conversation Hayduke, Wissing and I had regarding Charlie Feaga's assessment cap reduction.

One thing we didn't discuss was the huge disparity that assessment caps create (no matter if it is 4% or 5%). David Wissing made the point that if he sold his $250K home and and upgraded his property taxes would skyrocket because the cap on assessed value would no longer apply since he is moving to a new house. When he moved he would have to pay taxes on the total assessed value of his new home. This may be something that prolongs Mr. Wissing's ability to be able to afford to upgrade his home. Now if Mr. Wissing had a wife and children this could present some propblems for Mr. Wissing as the pressure for a suitable home for his growing family increases. Mr. Wissing might be forced to move to Carroll County to be able to afford a larger home and property taxes.

While a household's wealth increased as property value increases, there has not necessarily been an increase in the household's cash flow to pay the taxes. Therefore, they don't can't afford to upgrade to a larger mortgage and a larger property tax at the same time.

Now what if you are say, Jim Robey, who is downsizing his home and moving to a condo in Sandy Schraeder's district so he can run against her for State Senate (sorry had to work that in). He is leaving behind a lower property tax on his existing home (phased in taxes) and picking up a higher property tax on a less valuable property (he is downsizing – remember). His combinded new mortgage and property tax may actually be the same. Why is that fair? Senior Citizins, like Jim Robey, should be provided more incenetives to stay in HoCo when they down grade their homes. Mr. Robey, in his retirement from public office come November 2006, will use a lot fewer services than those of us still working, putting our kids through school, etc. We want Jim to stay in HoCo because we need his tax dollars. Fortunately Jim seems to be able to absorb the higher taxes he will incur as a result of his "downsizing". Unfortunately, some Seniors can't.

What if you are Hayduke? You just bought a house. In 10 years the value increases the assessed value increases, Hayduke's income increases. Lets say Hayduke has 5 kids and needs a bigger house. However, doing so will mean not only a more expensive house, but jumping into a much larger property tax bracket too. So, Hayduke moves to Carroll County (next to Mr. Wissing). How many families face that dilemna in HoCo? How often are our low and middle income families being squeezed out of HoCo because they can't afford to stay in HoCo when it is time to upgrade or downsize their homes because the assessment caps cripple them?

Wouldn't it be a good idea if Wissing, Robey, and Hayduke could take their current property tax assessment with them to their new home and pay the phased in assessment on their new property? Granted their would be some caps in place – but it would make it easier for them to stay in HoCo. HoCo would still have the benefit of three tax payers contributing revenue to the County coffers.

This needs to be fully vetted, but lets talk about it.

Read these articles and more on this later.

Article One
Article Two
Article Three

UPDATE 12:30 PM: Howard County Times Article on the issue. Granted this needs to be reviewed carefully, but I think it will be easy to determine the impact given the great deal of data on home sales in HoCo. I don't think the article adequately explains the benefits to Seniors downsizing to a less expensive home with a greater property tax bill. It also doesn't explain that the plan would still phase in the assessment on the new property.

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