BERLIN – Berlin will not raise its tax rate, but some homeowners questioned whether the town is doing enough to assist property owners in a declining economy.
Berlin cannot do anything to help homeowners with their property taxes, interim Mayor Gee Williams told several property owners, many from Decatur Farm, during a public hearing on the town’s tax rates on Monday night.
“Your assessments are possibly going to increase,” said Berlin resident Bobbie Johnson. “How much have you done to tighten your belt?”
“Are my taxes up or down, bottom line?” asked Jennie Mama. According to Mama, her house is not worth $150,000 less than she paid for it.
“Why are we being held at the same level? It doesn’t make fiscal sense,” said Mike Scholtes. “Our housing values are not drastically increased. If housing rates are going down, the tax rates should be going down.”
Housing, gas and food prices are going up, he said.
“Where’s the economic help from the government?” he asked.
Berlin will get just $200,000 additional in tax revenue from property reassessments, Williams said.
The town, which is affected by the same increases as private citizens, also has to absorb rising costs for items like energy and fuel.
Berlin is just now getting on its feet, the interim mayor pointed out.
“It has taken many years of financial challenges for the town of Berlin to finally start experiencing some stability in the last few years,” said Williams. “For years, the town was extremely strapped all the time.”
Revenues are now more in line with funding the town’s service obligations, he said.
Berlin faces three major challenges in the near future, according to Williams.
“There are some major street repairs that absolutely must be done,” Williams said.
Some of the streets in question have not been repaved in over 50 years, according to the interim mayor.
Stormwater and flooding must also be dealt with and that’s going to be a long costly process that could take decades to resolve.
“For years, the town could basically clean out the ditches and that was it,” Williams said.
Berlin’s contribution to the Berlin Volunteer Fire Company is growing and will continually need to be increased as the population increases and ages and more calls come from within the town limits.
“There’s no way around these basic services,” he said.
A tax cut would yield little savings for homeowners, said Williams, and in good faith he could not recommend such a move.
“It wouldn’t even fill your gas tank,” he said.
Some property owners seemed unclear on the property value assessment and taxation procedures, which are driven by the State of Maryland, not the town.
The state reassesses all property on a three-year cycle, and the new value takes three years to be fully assessed. Full-time residents also benefit from the homestead tax credit, set by the county at 3 percent.
Property owners who feel their home’s assessed value was too high can appeal to the state Department of Assessments and Taxation, Williams explained.
Kevin Poole, who owns a home in Decatur Farm, questioned town taxes paid versus services received. A former resident of Ocean City, Poole said he is paying twice the taxes for half the services. Trash is picked up only once a week, he said, and public works has failed to take his recycling half the time. He has also, he said, had major problems over his water bill.
While Berlin’s tax rate is twice that of Ocean City, the town has about a 10th of the assessable base of the resort, Williams said. Ocean City’s budget is about $80 million, while Berlin’s is $16 million.
Berlin’s tax rate is average or below that of other small Eastern Shore towns, the mayor pointed out.
“It’s always been as low as we can just to do basic services,” Williams said.
It would be irresponsible to put the town into financial straits because of the national and global mortgage and energy crises, Williams felt.
“I really sympathize with Decatur Farm. You’ve got some real challenges out there. But it wasn’t anything the town did to you,” Williams said.
The Mayor and Council unanimously approved retaining the same tax rate, 73 cents per $100 of assessed value.
The numbers in the budget for fiscal year 2009 remained the same over the last two weeks, since the first reading of the budget bill.
One change that did not affect the dollar amount of the budget was a reduction in the step increases for town staff salaries, which went down half a percent per salary level.
Berlin will also move to health reimbursement accounts instead of monthly premiums for employee health insurance, which will save $30,000.
The council passed the fiscal year 2009 budget without further discussion.