Your take on city property taxes
As of last night, 92 percent of you poll-takers said you agree with Baltimore economist Anirban Basu that the city's rate of $2.268 per $100 of assessed value needs to be cut now.
Six percent said not now, but when the economy's doing well.
Just two percent opted for the straight "no."
And one person felt so strongly about this that he or she skipped over the "yes" option to write in an answer: "Hell yes."
People usually like the idea of having less taxes to pay, so that was a pretty easy question for you all to answer. Now I challenge you to tackle a harder one: What cuts or adjustments should the city make to account for the (at least short-term) drop in revenue? What can the city do to avoid counteracting the "come on in" message of lower taxes with the unwelcome-mat of decreasing quality of services?
Proponents of rate reductions say a big cut would bring more residents, increasing the sources of revenue, but let's assume for this exercise that tens of thousands of people won't immediately drop everything to move in. (Also, you'll want to take into account that the city is already grappling with reduced revenues. Mayor Sheila Dixon announced in September that the city would have to "immediately reduce spending" to deal with a $60 million decline in revenue and state aid.)
Extra points to anyone with an idea more specific than "reduce waste." Here are two proposals from commenters to get you started.
The city can immediately reduce the overall property tax rate and recover any lost revenue by doing the following:Josh Dowlut has a budget-cutting suggestion:
1) Crack down on all homestead cheats by collecting back taxes, penalties, and interest for any years in which property owners were wrongfully claiming the homestead credit.
2) Discourage people from cheating on the homestead credit in the future by pursuing perjury charges against the most blatant cheaters (e.g. those who own multiple properties in the city and claim the credit on all of those properties).
3) Follow Washington DC's lead and raise the property tax rate for all vacant properties by 800% or more. With over 30,000 vacant properties throughout the city, this would seem to be a no-brainer.
Property taxes make up roughly half the general fund revenue. Public safety, education, and pensions/retirement plans make up the #'s 1, 2, and 3 expenses.
Roughly speaking you could trim property tax rates by 30% simply by eliminating pension benefits for government workers. We don't get them in the private sector, so why should they?
Dowlut points out that you can find the Citizens' Guide to the Fiscal 2009 budget here.
Ready, set ... go.