‘Tax Rollback’ Petition Turned In; City Solicitor Thinks It Violates State Law

‘Tax Rollback’ Petition Turned In; City Solicitor Thinks It Violates State Law

OCEAN CITY – A petition to referendum seeking a tax decrease is entering the signature verification process, but it is the Town of Ocean City’s legal opinion the substance of the petition will violate state law.

On Tuesday afternoon, Ocean City Taxpayers for Social Justice (OCTSJ) submitted a petition to lower Ocean City’s tax rate to the 2009 rate of 38 cents per $100 of assessed valuation.

Ocean City Taxpayers for Social Justice (OCTSJ) spokesman Tony Christ recognized the Mayor and City Council were scheduled to cast their final vote on the Fiscal Year 2016 Operating Budget that evening that would raise the tax rate 2 percent to 47.8 cents.

“We wish to return the tax to 38 cents, which is a 21-percent reduction of over 9 cents per $100 of assessed value. A tax reduction petition is both unprecedented and needed to stop the trend of residents leaving and declining values in the Town of Ocean City,” Christ said.

OCTSJ members Christ, John Medlin, Mac Balkcom and Herb Pawlukewicz have spent the past 10 months collecting signatures and turned in more than 1,800 on Tuesday.

“Standing up here are not spring chickens and often I am asked why we took the time to carry a petition. The answer is quite simple. From Washington to Annapolis to Snow Hill to the Town of Ocean City, we believe the political class is robbing the younger generation of their birthrights and imposing involuntary servitude upon them. We believe the political class has acted irresponsible with public funds and in doing so has placed the kids’ future in jeopardy and in violation of their inalienable rights guaranteed in this constitution.

When a child exceeds his allowance, overspends, what do you do? Pay him more or cut him or her back?” Christ said. “It is healthy for the voter to take out the cattle prod every now and again to remind the political class who the boss is. Oftentimes politicians promise to be good custodians of the public purse strings to get elected then once in office they don’t live up to their promises and their boss, the citizens, must remind them.”

According to Charter Amendment Procedures for Maryland Municipalities, “the residents of an incorporated city or town may initiate an amendment to a municipal charter by gathering the signatures of at least 20 percent of qualified municipal voters on a petition in the same fashion that a charter amendment approved by a municipal governing body may be petitioned to referendum.”

Once the appropriate number of signatures is verified, the Town of Ocean City will be required to conduct the referendum within 90 days or at the next scheduled election, which is in November of 2016.

The Worcester County Board of Elections reported to the OCTSJ there are 5,274 active voters and 865 inactive voters for a total of 6,139 active and inactive voters in Ocean City. Twenty percent comes to 1,228 signatures of verified voters for the petition to qualify for a referendum. It is important to note the voter role has been reduced by over 1,000 in the past year.

On Monday City Clerk Kelly Allmond verified she had received 1,827 signatures. However, this does not confirm or deny the validity of the signatures being registered Ocean City voters.

Christ first brought the petition effort to the Mayor and City Council’s attention in October. At that time, Finance Director Martha Bennett had the most recent CAFR in hand pointing out in 2009 the town collected close to $47.9 million in property taxes compared to 2013 when the town collected almost $42 million, which is almost a $5 million decrease in what the town billed the taxpayers of Ocean City.

Bennett also reviewed in 2010 the town collected about $43.8 million in property taxes, in 2011 about $42.7 million and in 2012 almost $42.6 million.

“In 2013, you did not raise taxes, in fact they were lowered. We took extra room taxes during those years because we never saw declining room taxes during the recession. That increased from $11 million [2009] to $13 million [2013], and we were able to balance our budget with other sources and fees but property taxes that we billed the property owners in Ocean City is less in 2014 and 2015 then it was in 2009,” Bennett said.

Former Councilman Joe Mitrecic, who now serves as County Commissioner, also presented the ongoing argument that if the tax rate is cut, city services will also have to be cut.

“When you decide that you want it to be 38 cents you also have to decide what you want taken away,” he said at that time. “Do you want the streets cleaned in front of your house? Do you want the city to stop picking up your trash? Do you want clean water coming out of the tap…That is what it comes down too. We provide services with your tax dollars, and whatever services you don’t feel that you need any more than this council can bring that tax rate down.”

In Christ’s opinion, a cut in city services is not an excuse.

“There is no way this can’t be handled. They can take $1 million out of EMT service to West Ocean City and $2 million out of the police budget. Put them on furlough six weeks in the summer, they would love it … take $1 million off of the winter bus route and save the wear and tear on the buses … the other $4 million can come out of advertising …,” he said on Monday.

The Mayor and City Council voted to approve the FY16 Budget in its final reading on Monday evening. At the conclusion of the meeting, City Solicitor Guy Ayres recommended the council vote to request the Worcester County Board of Elections verify the number of petition signatures.

“I suspect that there may be some litigation over this petition, and the court is not going to reach a determination if the petition has not been verified with the requisite number of signatures,” Ayres said. “The issue is with the substance of the petition. In my opinion, the substance of the petition violates Section 6-303 of the Tax Property Article of the Maryland Code Annotated. The substance of the petition would amend the charter, so your ability to tax would be capped at the 2009 level of taxes, and that is known as a ‘tax rollback.’ In the case of Board of Election Supervisors vs. Smallwood … the court had ruled tax rollbacks are not proper charter material and violate Section 6-303.”

The Mayor and City Council voted unanimously to request the Board of Elections verify the number of signatures on the petition.