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Maryland Supreme Court considers Baltimore property tax referendum
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Maryland Supreme Court considers Baltimore property tax referendum

Maryland Supreme Court considers Baltimore property tax referendum Listen to this article

The Maryland Supreme Court announced Tuesday that it will hear an appeal from a group seeking a referendum to halve property taxes in the city of Baltimore.

The organization Renew Baltimore – which boasts the support of several prominent religious leaders, economists and former elected officials – is proposing an amendment to Baltimore’s city charter that would reduce the city’s property tax rate from 2.248 percent of assessed value to 1.2 percent over seven years.

The group’s bid was rejected last month by the Baltimore City Board of Elections, which ruled that property tax rates cannot be set by voters through a referendum. The group appealed to Baltimore District Court, which on Friday upheld the board’s decision.

The group then appealed directly to the Maryland Supreme Court, which agreed to expedite the case because the Maryland State Election Commission had to wait for a September 2 deadline to certify the ballots.

Baltimore District Court Judge Althea M. Handy wrote in an August 12 opinion that the motion was “inconsistent with the Charter” because it “allows the citizens of Baltimore to set the tax rate and leaves the City Council with no ability to legislate because it must reduce the tax rate each year.”

Renew Baltimore must file its complaint by August 20, against the city’s deadline of August 26. Oral argument is scheduled for August 28 at 9 a.m.

The group’s proposal calls for a property tax cut of about 5 cents per $100 of assessed value, to 2.2 percent in July 2025. The rate would drop another 10 cents in 2026, then 18 cents annually until it reaches the permanent cap of 1.2 percent in 2031.

Supporters say the city’s property tax rate — by far the highest in Maryland — is contributing to the city’s declining population. They say a lower rate would lead more people to move to and invest in the city, which would offset the loss of revenue. Baltimore County’s property tax rate is 1.1%, less than half the city’s; Howard County’s is 1.044%, and Anne Arundel County’s is 0.983%.

Baltimore Mayor Brandon Scott, City Council members, unions and others oppose the plan, saying it would throw the city’s finances into turmoil. In a June statement, Scott said the cuts would “bankrupt” the city and the claims were “questionable at best.”

“If the petition appears on the ballot, it will impact the city’s ability to fund its current contractual obligations and fulfill its statutory responsibilities,” city lawyers wrote in a July filing.

A report from the Baltimore City Finance Office said the plan would “cut a massive structural hole in the city’s budget,” reaching nearly $900 million a year by fiscal year 2034.

“The city would be unable to balance the budget through small savings, efficiency improvements or new revenue,” the report said. “Instead, the city would be forced to make massive service cuts to many agencies, which would have a crippling impact, especially for residents who most depend on city services.”

The Treasury Department also said the revenue could not be covered by population growth. It says the city’s population would have to exceed 850,000 for the proposal to be revenue neutral and reverse 50 years of population decline in less than a decade.

Instead, the ministry recommended an “incremental” approach to reducing fees, introducing a waste fee and generating more money through nonprofits by renegotiating PILOT agreements.

This wasn’t the only Baltimore voting issue the state Supreme Court addressed on Tuesday.

Separately, the court agreed to hear arguments on a proposed amendment to the city’s constitution that would create the “Baltimore Baby Bonus.” If passed, the amendment would require the city to pay families at least $1,000 upon the birth of a new child or upon adoption.

The Baltimore City Board of Elections certified the question, but the city’s district court declared it unconstitutional on the grounds that it “supersedes the legislative power of the city.” Oral argument is also scheduled for August 28 at 9 a.m.

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