Downtown surcharge pales next to tax breaks
Agreeing to an increase in the Downtown Partnership surcharge is the least large commercial property-owners can do, considering all the tax breaks that have been given out for locating there. On Sunday I wrote about the need to get more revenue from one undertaxed set of businesses in the city: universities and hospitals that fall under the nonprofit section of the tax code.
Developers getting millions in downtown tax breaks are another group. The downtown business district is riddled with hotels and office buildings that aren't paying their share of property taxes to the city. Developers and the Baltimore Development Corp. argue that the projects wouldn't have been "economically viable" without the welfare. In any case, bumping up the partnership surcharge is one way to get the projects to contribute a little more to the environment that supports them.
The increased surcharge will hit every downtown commercial property, not just the ones getting tax breaks. I propose a special "Paterakis tax" to allow the partnership to get extra money from the welfare queens.
UPDATE: Harbor East isn't even in the Downtown Partnership zone, so the Paterakis projects over there aren't even paying partnership surcharges. Harbor East certainly benefits from all the upgrades to the old city business center, and it ought to be folded into the partnership zone.
PS. Harbor East is in the Waterfront Mangement District, where the surcharge is 17 cents per $100 of value. That's more than the Downtown Partnership assessment is now but less than what the DTP tax would rise to.
Comments
I agree with you. The nonprofits should pay property taxes.
Posted by: NotableM | April 20, 2010 11:04 AM
schaeffar gave Paterkis the store
Posted by: larry g | April 20, 2010 11:52 AM
Legg Mason recently got 15 years tax forgiveness on the $200 million waterfront tower and 25 years tax free on the garage they built. You could fund the entire Charm City Circulator on the $5 million tax revenue they are shirking/displacing on others.
http://articles.baltimoresun.com/2009-06-30/business/0906300013_1_legg-mason-harbor-east-new-building/2
Posted by: Josh Dowlut | April 20, 2010 11:52 AM
Excellent comments, Jay. Now let's wait for the tea party people to come in and defend these corporate welfare recipients.
Posted by: Rick | April 20, 2010 11:54 AM
Oh please, exactly what is their "fair share" Jay? Does anyone really think a profitable organization would locate in a tax unfriendly city inside a tax unfriendly state without incentives?
Posted by: KBP | April 20, 2010 1:53 PM
I agree with you Jay...
The City needs to reduce the tax rate across the Board... period. Yes there would be some extreme belt tightening and the bureaucracy would shrink but arguably to a more sustainable level and the city would be more viable for it.. I mean reduce it for both commercial and residential (not just the five year break for new home construction.)It could not be done immediately but phased in over time. Stephen Walters and Louis Miserendino co authored 'Baltimore's Flawed Renaissance' dive into this issue in more detail about the cities tax structure. They bring up some good points that should be argued and explored.
Posted by: mobtimore | April 21, 2010 9:22 AM
I agree with you Jay...
The City needs to reduce the tax rate across the Board... period. Yes there would be some extreme belt tightening and the bureaucracy would shrink but arguably to a more sustainable level and the city would be more viable for it.. I mean reduce it for both commercial and residential (not just the five year break for new home construction.)It could not be done immediately but phased in over time. Stephen Walters and Louis Miserendino co authored 'Baltimore's Flawed Renaissance' dive into this issue in more detail about the cities tax structure. They bring up some good points that should be argued and explored.
Posted by: mobtimore | April 21, 2010 9:23 AM