Budget talks are heating up across the region. That’s not usually an exciting topic for most readers, but a couple big announcements made this week deserve some elaboration.
Ocean City property owners could see a two-cent reduction in the property tax rate if the City Council accepts the city manager’s proposed spending plan, and county is looking to leave its rate as is. Any government official looking to increase the property tax rate this year should be checked out mentally, and the examination should not be done on the public dime.
To increase the burden on taxpayers, already overwhelmed with the increased cost of simply living, would be political suicide at this time. More importantly it would break the back of some families finding it hard to pay their bills, let alone save for their future.
With the current state of the economy, there should be no talk of raising the tax rate by any government body during budget talks. The only talk should be decreasing the tax rates. The worst-case scenario would be leaving the rates unchanged. It’s no secret the state has cut significant amounts of local aid to make up for an enormous budget deficit, leaving the county and municipalities in precarious positions, but tough decisions will have to be made and creative financing utilized.
It’s important to remember nearly every property owner in the county will already be paying more property taxes this year, due to rising property assessments. It’s the property tax rate set by the individual jurisdictions being addressed here. It’s the amount of money you pay based on your assessed property value. It stands to reason if your property value goes up, as most have steadily in recent years, and your tax rate remains the same or is lowered slightly, you will be paying more out of pocket to own your land. That’s why some folks’ mortgage payments are adjusted every year to offset increases in the amount of property tax owed.
Therefore, with more money already being pumped to local governments due to increased assessable bases, increasing the tax rate would be absurd and cause for protests. A reasonable argument could be even be made governments should reduce their rates to the constant yield rate, the level that would bring in the exact same amount of revenue as the previous year. That’s never done in the public sector, but private businesses often hold the line out of sheer necessity.
The county and resort took themselves off the proverbial hot seat this week by confirming they would not be increasing taxes. Other governments in the area are now on the clock and they would be wise to mirror these decisions.