State Bill Provides Means To Continue Conv. Center Tax

BERLIN – With the Maryland General Assembly moving into the meat of its 2008 session, several bills of local importance have been dumped into the hoppers on both sides of the aisle, including a handful introduced last week that deal with a potential expansion of Ocean City’s convention center, a Homestead Cap extension and a significant bond for a major historic restoration project ongoing in Worcester. 

Of course, almost all of the pieces of new legislation proposed during the General Assembly, with the exception of county- or project-specific bond bills, are important on some level in all areas of the state, but some are more closely watched on the local front then others.

For example, House Bill 1064, introduced last week by local Delegates Jim Mathias and Norm Conway would enable the local governing body of a code county, in this case Worcester, to impose a tax on food and beverages in a resort community if all or a portion of the increase was dedicated to the expansion of a convention center in the community. For years, there has been an additional one cent per $1 tacked on the sales tax in Ocean City to help pay for the most recent expansion of the Roland E. Powell Convention Center.

The supplementary sales tax is set to expire in 2015, but with Ocean City’s convention center possibly slated for another major expansion in the next few years, the bill introduced by Mathias and Conway would provide the mechanism for extending it through the life of the new expansion project. While no firm plans are in place, an expansion of Ocean City’s convention center is currently under study and another major addition is anticipated.

“Basically, this bill will enable that tax to go forward,” said Mathias. “The Mayor and Council have a reasonable expectation the convention center will someday be expanded and feasibility studies are already underway.”

Funding for feasibility studies and perhaps firm plans for expansion is currently drawn from an account fueled by the one-cent surcharge on the sales tax. House Bill 1064 would set a cap on the account fueled by the additional sales tax at $20 million.

Yet another piece of legislation of local importance introduced last week is House Bill 1058, which would extend the benefits of the Homestead tax credit to vacant lots adjacent to a primary residence which is owned by the same homeowner. Resident property owners in Maryland are protected by the Homestead Cap, which sets a limit on the amount of property tax increase regardless of the hikes in assessment values.

The State of Maryland sets its Homestead cap at 10 percent, but the County Commissioners last year reduced the Homestead Cap in Worcester from 5 to 3 percent.

House Bill 1058, co-sponsored by Mathias along with 19 other delegates, would extend the protections offered by the Homestead Cap to cover undeveloped parcels connected to the primary residences. If approved, it would be applicable to all taxable years after June 2009.

In yet another bill of local importance introduced last week, House Bill 1003 would authorize the creation of a state debt not to exceed $250,000, the proceeds of which would be used as a grant for the ongoing restoration of the historic Rackliffe House Plantation in Worcester County on Assateague Island. The centuries-old plantation house is currently undergoing a major renovation and rehabilitation project funded largely through federal, state and local grants along with private fundraising efforts and donations, and House Bill 1003 would contribute $250,000 from the state general fund to the cause.

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