Does the Laffer Curve sound familiar? O'Malley tried raising taxes on high wage earners and what happened? They left the state. If the Mayor's last resort is to raise property taxes, you will see even more people who are paying property taxes sell their home to move outside the city. I would hate to make this political, but raising property taxes is not the answer.

If you want to further drive down housing prices and make Baltimore City real estate look like a bad investment, then by all means look into raising the property taxes. If that's what happens, I will never vote for her in an election.

The tax rate in the city is already oppressive to the Only type of investment which will bring the city back on a large scale (contributing individuals and families willing to live in the city). If property taxes are increased your going to do some very real long term damage to this city. The tax rate in Baltimore is not competitive (by a long shot) with ANY OTHER jurisdiction in the state.

Mr. Rizzo - your assertion that people left the state because of the hike in the tax rate has never been proven, because, amongst other things, people have been moving up I83 for years for the lower cost of property, lower crime rates, etc. There was a study that showed there were fewer millionaires in the state now than in years past, but again, we an economic collapse that wiped out the net worth of millions nationwide. For instance, if you were a millionaire shareholder of GE in 2007, you'd be worth about 50% less now, assuming that GE was the only stock that you held.

With that said, when you have property taxes at $500 per month on one block, and a mile away property taxes are $250, people are going to vote with their feet and leave the higher taxed areas, because not just are they paying lower taxes in the counties, they are also getting lower crime, more parking, better schools, etc.

Lowering the property tax in Baltimore City needs to be a top priority. The city also needs to dump the thousands of vacant properties it owns. On my block, the city owns 4 large properties, and several investors I know have shown interest, backed up by funds, to buy those properties and rehab them into nice single family homes. Not just would this increase the property values of the surrounding homes (thereby increasing the property taxes w/o increasing the rate), but it would also generate revenue for the city and stimulate economic development.

From what Rawlings-Blake said, it sounds like she agrees that raising property taxes is a terrible idea, which is why it's a last resort.

The city is in a dire financial situation, so increased property taxes sound possible, but do you really think more people would move out because of high property taxes or if more fire stations are closed and the police department is stripped of funding? I'd rather pay a little extra tax rather than sacrifice safety.

If property taxes are raised, I'm moving. I pay almost 6k a year for a row home that is 12x70. It's ridiculous.

Besides this junk, what are her qualifications? What has she ever done? I am kinda confused.

"In four terms on the City Council, Rawlings-Blake’s many accomplishments include passing laws and initiating policies in a wide range of areas such as public safety, community development, public education, business development, hospitality and tourism and arts and entertainment. "

I once had the privilege to work with a number of elected city officials... When I bought my home just outside the city, one of them said to me, "ah, anne arundel county--twice the services, half the taxes." And he's right. All that, and 15 minutes from downtown...

While population and taxes are certainly a "chicken and the egg" type problem, the City must come to a better balance if it hopes to affect a permanent change in its fortunes. I think the two-tier approach is a great step in the right direction, and wish the City luck in Annapolis.

Part of the reason Baltimore city has high property tax rates is low values and low assessments. If you live in a house worth $45,000, and the tax rate is 2.268 your tax is $1020 per year; $85 per month. That was the situation all over Highlandtown and Hampden at the beginning of this decade. BUT . . . put in some granite counters, stainless fridges, then take off the formstone and the place suddenly sells for $200k--or $450k. Now you're looking at paying $378 or $850 per month in taxes for the same rowhouse. The city's tax rate didn't go up much; alleged "values" did.

Taxing vacant properties at a higher rate (1.5x, double or triple???) sounds like a great idea. Gives these absentee home owners an incentive to put the place to use, instead of letting it sit. Is there any downside? Will the state have a harder time collecting?

While I don't agree with raising the property tax-rate for occupied dwellings in Baltimore City, I do applaud Rawlings-Blake for her stance on raising the property tax rate on abandoned buildings.

Abandoned houses are a drain of tax funds, they pay almost nothing into the tax stream and require three times the policing man-power, are four times as likely to set fire, and reduce the property values (and therefore the tax base of the city) on every house on the same block as the vacant property by ~$8K.

By encouraging people to convert vacant houses into occupied dwellings, the city would gain millions of dollars of revenue through the increased property values alone, not to mention the 3% income tax they would receive from the tenants (and sales tax, telecommunications tax, etc, etc).

It's about time Baltimore start incentivising "active homeownership" and stop throwing money at problems created by real estate speculators who don't even live in the city.

I wonder what the first resort is if raising property taxes is the last? Raising income taxes? That doesn't sound great either.

I wish they would stop spending so much money on homeless people and supporting low income people. Sorry to sound uncompassionate. This would result in two things though, one - taxes wont need to be raised and two - maybe some of the jobless, the ones who statistically do most of the crime, will move away and reduce crime.

Yes, Stephen, I do think people will move out because of high property taxes, and my family will be among them. We are currently in limbo as it is, with a baby and a house that needs to be rehabbed, we'd love to buy in the city but for the property tax rate which is beyond ridiculous as it is. It just makes no sense to rehab or buy here. None.

Of course, most of the vacant and uninhabitable properties in the city are a by-product of the city's high property tax rate, which repels capital investment. Attempting to punish the "slumlord" owners still more may satisfy lefty, anti-capitalist ideologues, but will simply hasten the flight of capital from B-More. Remember: the city's rate is ALREADY twice that of the surrounding county. If punitive taxation made owners invest, the city would already be a garden spot relative to the county. Mr. Gonter and his friends have things exactly backwards; pity the City Council is foolish enough to even think twice about it, but it explains how we got this way in the first place.

Not just here, but everywhere in the country taxes are going up to help the poor. The problem is, the poor are failed Americans who give nothing back to society. The rich and the middle class built and sustain this country - the poor just provide a large number of mouths clamoring for unearned wealth.

Andy-

You may be right that it may be impossible to measure why the millionaires left unless you ask them personally. The fact is that they are no longer here. One can only put the two together and come up with their own conclusion. When O'Malley increased taxes, there is no denying that the millionaires left the state in droves. You can say they are no longer millionaires, which may be the case for a minority, but the majority are still millionaires living elsewhere.

The whole point is that increasing taxes does not necessarily translate into higher revenue. When taxes are raised to a certain point, you can actually receive less revenue than lower tax rates. Increasing property taxes will have a similar effect. More people will leave the city for the county where taxes are lower. As others have already stated, the property taxes in the city are absolutely ridiculous.

When you increase property taxes, that will further suppress real estate values. Not only will demand go down due to higher taxes, but less people will qualify for a mortgage when the taxes are calculated in your escrow portion of the payment. This will increase debt to income ratios. It may not appear significant, but it can most certainly be a deal breaker for many people. Again, the only way to compensate for higher taxes is with lower values.

seeing that the property tax would only be raised on the owners of vacant houses that they refuse to fix up so that they would be habitable, then obviously this tax would only affect people that already left the city but still hold derelict property. these people are part of the problem so it makes sense they should be footing the bill. Also, most of them are weathly suburbanites who can afford it.

Most likely those people would be encouraged to sell their property to people that will actually fix the properties up (developers) and later re-sell them to the many many people who actually want to live in fixed up urban dwellings. In the short term this means money for contractors, and in the long term, a larger tax-base by adding wage-earners.

Looking at pending demographic shifts, there is, and will continue to be a large and ever-increasing demand for high quality urban housing. At the same time, there is a massive over-abundance of suburban and exurban housing for which demand is already completely saturated. Developers could stop building suburban housing today, and there would still be an over-abundance - in a couple decades about 40 million houses of surburban dwellings, in excess of demand. At the same time, we could do nothing but build and renovate urban properies over the same time period, and still never catch up with demand. The over-abundance will continue to push down prices in the suburbs, while prices in the city will keep going up due to pent-up demand.

In Baltimore, there is a huge amount of dilapidated property that could be renovated to meet this need. Much is held by by wealthy people in the suburbs.. One great way to handle this is to raise property taxes on run-down and unihabitable property, and lower property taxes on renovated and high-quality property.

So much chatter and everyone misses the obvious.

The City has higher RE taxes (per person) because it has lower income taxes (per person). Is that so complicated to understand? All the rest of the hand wringing over specifics is window dressing.

That includes trimming budgets as well (which isn't a solution).

Every penny that might be saved by trimming the budget (and perhaps the mission) of the various agencies and departments is still more than justified to be spent to reinforce the remaining efforts of those agencies and departments.

The City needs more "earners" as a percentage of the population. A lot more. There are two basic (short term) ways to achieve this. 1) import earners from elsewhere or 2) export non-earners from the City.

The long term technique of "growing your own" earners could work as well but I frankly don't thing the City has the 30 years needed to achieve this.

Just like any business, the City has to have something to offer to it's customers (the tax base). Increasing taxes is detrimental to increasing revenue, without providing basic services or the normal quality of life one can expect anywhere else for less. Any tax base will move to Baltimore, guaranteed, regardless of any demographics, and no matter what the City tax rate is IF:
1- Schools are par or better then the competition
2- Public safety (including the perception of safety) is equal to or safer then the competition.

Baltimore has nothing to offer if your life, or your kids future, is the price you have to pay for living here. Baltimore will never EVER will be worth a damn with the tax rate being so high (7th highest in the nation), and the schools being what they are (2nd worts in the nation). DO NOT KID YOURSELVES.

These facts hold true for any person or business making a logical decision, and is undeniable no matter what else you offer (like free shuttle buses, I mean really!).

Therefore, the mayor should;
1- Immediately reduce property taxes that are lower then or equal to Baltimore County.
2- Shift most of the budget to School and Police.
And the rest will come...

This will result in, I guarantee you, an influx of families, and the businesses that support them, to move in to the City in droves and pushing out the bad elements - who do not pay taxes in the first place . Thus solving the budget crisis, the school crisis, the crime crisis.

Of course the opposition would say, well you're just trying to gentrify the City. Not the case, just trying to make it livable and viable. It's embarrassing to a have 3rd world city, in the richest state, and just minutes from the White House. EMBARRASSING!

There is another problem here nobody wants to address, and that's the race issue. NAACP HQ is here and are quick to jump on anything that will score political points, same for the politicians. Even Rawlings-Blake jumped on a story last year about a new school employee who wasn't qualified or vetted, saying the controversy was brought upon him because he's black. NAACP's "Doc" (who went to Coppin where they do not offer advanced degrees) said that the next mayor should be black because the City is mostly black.

This will keep Baltimore in the gutter, because nobody wants to be unPC, or risk their neck in a political battle, and be labeled racist when facing ignorant and racist people like these. they just run, cower, and hide - a la O'Malley.

The truth is, race based bias is bogging down every effort made in this city, from city judges freeing killers, the police being accused of profiling, to teachers passing students who cannot read or write.

Baltimore, henceforth, will never EVER become anything worth a DAMN.- unless of course you're a criminal, then it's perfect place to live.

No one in their right mind would go to a store and pay twice as much for an inferior product. Yet, this is what the city expects citizens to do when it comes to property taxes. The property tax issue is THE magic bullet here. If taxes were more in line with the surrounding jurisdictions, Baltimore would experience a absolute renaissance, short & simple. An idea: start an incentive program for home purchases in the city where the property tax rate is equal to that of Baltimore County. This will result in an increase in home sales & an increase in the city tax base. As the tax base increases, the city can then begin to incrementally lower the property tax rates for existing homeowners. End result, more homeowners in the city. More tax revenue. A more vibrant community.

If the total budget is 2,194,500,000 and there are 478,963 (637,475 residents with 24.8% <18), every single person over the age of 18 must contribute an average of $4,581 and every person averages out to $3,442.

Since the median income for a family is $35,000 very few people pay their fair share.

Here's why being the typical Baltimore resident is a good deal.

1. If you have 6 children, pay no income taxes and pay $1500 in property taxes through your rent, you're are getting a hell of a discount. If you paid the average, you would pay $24,097 and so you are getting a 93.8% discount.

2. You and your partner pay $1500 in City income taxes, $4000 in property taxes and $300 in parking fees. Your savings are getting a $1,084 discount. (Or maybe a $3500 discount depending on how you look at it.)

If I were a politician, I would make sure that the majority of the population receive more than what they paid in. That way they will be happier and vote for you. Pander to the poor; excoriate the wealthy and call them racists.

I have suggested a renters tax. If you are renting in Baltimore then your landlord should have to pay a tax for every apartment or house that he or she rents. There are more renters than homeowners in the city. This should bring down the prop. tax rate. If they do increace properity taxes I will be one of the people who will sell thier house and move into the county. I live right on the line and I am sick that my friend who only lives one block away from me paid a percentage of what I paid last year

Just knowing that they are even considering raising property taxes in the City is unnerving. I pay (2X,3X, maybe even 4X)higher property taxes, Special Benefits taxes, exponentially higher utility bills, and 2X or 3X higher insurance to live in a rowhouse in the City versus a single family house in one of the suburbs. It is already ridiculous. Don't worry about my vote if you raise taxes, I won't be here for the next election.

If the Property tax rate goes up I move out of Baltimore. It is is simple as that. I do not get near as much for my money as people in county and the county looks better and better every day. Why pay more for high crime and bad schools.. These people are idiots, who keeps voting for them?

Mr. Stovey,

I have explained on this blog before that many conservatives support this proposal. As Joe stated earlier, "Abandoned houses are a drain of tax funds, they pay almost nothing into the tax stream and require three times the policing man-power, are four times as likely to set fire, and reduce the property values (and therefore the tax base of the city) on every house on the same block as the vacant property by ~$8K." How do I have it "backwards"? Shouldn't properties that require more police, fire, and other essential services have to pay more in property taxes than a city homeowner?

Perhaps you're so angry because you're one of these property owners who would be affected by this new legislation. If so, why don't you just fix up your properties instead of bellyaching over a "lefty, anti-capitalist" idea?

Property tax revenues are the result of a real estate tax levy applied to the total assessed value for taxable property in the city. Generally the city needs to understand how assessed values for the various classes of real estate will change before deterring how much revenue they can receive using the present real estate tax rate or deciding how much the rate needs to change to bring in the revenue needed to fund needed services. The property tax base for the city can change as a result of five key factors:

1. Appreciation or depreciation in market values that cause property assessments to correspondingly rise or fall. The various types of real property (agricultural, commercial, industrial, multi-family residential, single-family residential, and vacant land) may change at differing rates, depending upon the local real estate market. Some communities have more diversified property tax bases than others.

2. New construction (also remodeling, renovation, and similar improvements) or changes in the local zoning code or land use regulations allowing for intensified use of property, if there is a demand this intensified use, will cause the tax base to increase to reflex increased property value. However, property loss due to damages (fire, flood, and similar conditions) and down-zoning property where there is a demand for equal or greater use can cause the tax base to decline.

3. Changes in the tax exempt status of property. When the taxable status of a property changes from taxable to tax exempt, the tax base declines. Likewise, when the taxable status of a property changes from tax exempt to taxable (usually upon sale to a taxable owner), the tax base increases. Therefore, a large-scale development that is tax exempt does nothing for the direct benefit of increasing the real estate tax base. Indirect benefits may occur if related services are needed that are provided by taxable owners or tenants. The taxable status of property is generally governed by state law and can be very complex at times.

4. Changes in state and local tax laws can cause the real estate tax base to increase or decline. These laws can also affect or place caps on the other categories listed here.

5. As the result of assessments challenged as part of the assessment review and appeal process available after each reassessment. While the assessment review and appeal process is necessary in order to correct cases where properties are assessed higher or lower than the required level or are otherwise inequitable compared to similar properties, the result is generally a reduction in the tax base.

I have a real issue with raising the property tax rate. I pay $2600 per year on a $116k row house. Almost a third of my mortgage every month goes towards tax escrow. If the city doesn't do it maybe the state needs to put in place a cap of 2 percent of an assessed value on what a county/municipality can charge in property taxes. Let’s make it a referendum to the state charter!!! The fact is we in Baltimore are getting hit in many ways, high income taxes, high property taxes, high fees for city services, high fines, and the list goes on. Through out the country places with high property taxes generally have a lower income tax or sales tax rate to balance out the taxes. I think there is allot of waist in city government, old contracts that no one is willing to renegotiate because they receive kickbacks, a pension system that is more generous than anything seen in the private sector, and politicians that are happy with the status quot. Baltimore needs to stop being content with being a welfare state by attracting wealth to the city. I do support having an extra tax on blighted properties but I think that the tax should be used, at least in part to give a tax credit to their neighbors who have to deal with the impact of the blight (higher insurance costs, lower property values, ect.)