One Councilman want to lower it to the constant yield rate.
Frederick, Md (KM) The Frederick County Council on Tuesday evening will be holding a virtual public hearing on whether to set the property tax rate in fiscal year 2021 at the constant yield. That would bring in the same amount of revenue that the county is collecting in fiscal year 2020.
Councilman Steve McKay says he supports lowering the rate to the constant yield. While that would mean less revenue coming into the county, McKay says citizens would pay a smaller amount on their tax bills. “So if we can suck it up a bit on the county side, and provide a bit of relief however small, maybe this year, we should do that,” he says.
In the end, he says citizens would benefit in future years. “If we then keep moving along at that low rate, next year, the year after, the savings start to add up…..all those taxpayers,” McKay says.
Frederick County’s current property tax rate is $1.06 per $100 of assessed value. It’s been at that rate for several years, and County Executive Jan Gardner’s proposed fiscal year 2021 budget keeps the property tax at the current rate.
The constant yield rate for Frederick County is $1.0344 per $100 of assessed value as set by the State Department of Assessments and Taxation. If the county set its property tax rate at that level, it would receive $8.5-million less in revenue, according to Budget Director Kelly Weaver.
Supporters of keeping the current property tax rate say the additional revenue is needed due to an increased demand in services during the COVID-19 pandemic. But Councilman McKay says if the county needs the additional revenue, it should tap into its fund balance “which is monies that we’ve taken in above and beyond what we expected,” he said. “In FY 20, we received $27-million more in income tax revenue than we budgeted for; and that’s going into fund balance right, into savings.”
“After all, the fund balance is money that the taxpayers put in,” he continued. “And right now, it’s collecting interest. Let’s ;put it to use.”
Supporters of lowering the property tax rate to the constant say homeowners’ property values go up when the assessments go up. So those people are paying a higher tax. “Ignoring that political argument, let’s focus on providing a little tax relief, lowering the tax rate,” says McKay. “It doesn’t change the fact that your home may still appreciate in value, which is good. Just maybe we can try to save you a little bit on that tax bill.”
The virtual public hearing on the tax rate is schedule for Tuesday, May 4th beginning at 7:00 PM.
By Kevin McManus