The following letter was sent by John P. Mallamo of Bel Air:
HB 653 Real Property Tax Relief
On 25 February the Maryland General Assembly House Ways and Means Committee conducted the first reading and public hearing on HB653, Constitutional Amendment.
This Bill introduced by Del Richard Impallaria, (R-7) provides Real Property Tax Relief to all property owners and residents of Maryland. Important features of the Bill include:
1. A fixed cap on property assessments. Real Property Tax Assessments are limited to the lower of the Consumer Price Index or 2% per assessment period, unless and until a property is purchased or transferred.
2. Protection to property owners affected by government action. Property owners will not receive full cash value appraisals and increased assessments from the base value of their properties purchased as replacements for properties affected by actions resulting from eminent domain, government purchase, governmental activity resulting in inverse condemnation. What this really means is that if a property owner loses property to a government actions, the property owner can purchase a like property without receiving a levy of a full cash value assessment that would be otherwise associated with a transfer of property.
3. Protects property transfers between spouses from full cash value appraisal. Transfer between spouses includes transfer to a trustee for the beneficial use of a spouse; transfer upon death; or transfer to a spouse or former spouse resulting from agreement or decree of dissolution of marriage or legal separation.
4. Protects property transfers from full cash value appraisal if the property is a principal residence and the transfer is between family members.
What does all of this mean to property owners.
First it means that the assessed value of a property is set at a base year. The assessed base value cannot be increased by assessment above the Consumer Price Index or 2 percent in any period. The only time the full cash value can be recomputed is on purchase or change of ownership. This applies not only to primary residences but to business properties and second or other homes as well. By contrast the present assessment process establishes a new value for properties based on area sales, and construction costs. Property assessments under this system have risen by as much as 60% in one assessment period.
Second transactions by property owners whose property is affected by government actions, and who subsequently purchase similar replacement properties are not considered as purchases or transfers. The base value of the affected property is transferred to the replacement property.
Third, property transfers between family members, spouses, former spouses and surviving spouses, under conditions described above are not considered purchases or transfers , and the base value is not increased by a new appraisal.
Residential property owners benefit because property assessment increases are limited to the lower of the Consumer Price Index or 2 per cent.
Business property owners receive the same protection from increasing assessments.
Residents who do not own property, but who deal with business in Maryland that do, will see the decrease in the cost of doing business reflected in the price of goods they purchase.
Local and state government benefit because they have a predictable source of revenue.
If you agree that this Bill will provide Real Property Tax Relief, then send a note asking members of the Maryland State Legislature House of Delegates Ways and Means Committee to vote in favor of the Bill. Their names and E-mail addresses are listed below.
sheila.hixson@house.state.md.us
annmarie.doory@house.state.md.us
joseph.bartlett@house.state.md.us
kumar@kumarbarve.com
joseph.boteler@house.state.md.us
jon.cardin@house.state.md.us
page.elmore@house.state.md.us
bill.frick@house.state.md.us
ron.george@house.state.md.us
jim.gilchrist@house.state.md.us
carolyn.howard@house.state.md.us
jolene.ivey@house.state.md.us
Anne.Kaiser@house.state.md.us
peter.murphy@house.state.md.us
LeRoy.Myers@house.state.md.us
john.olszewski@house.state.md.us
craig.rice@house.state.md.us
justin.ross@house.state.md.us
Christopher.Shank@house.state.md.us
melvin.stukes@house.state.md.us
frank.turner@house.state.md.us
jay.walker@house.state.md.us
John P. Mallamo
Bel Air, MD
Looks like this could be a good deal for taxpayers. Legislation like this should get across the board support- it will make Maryland more attractive for businesses looking for a new home regardless of the high income taxes.
This bill, HB 653, has many good points. The home owners will be able to budget for the property taxes that will be incurred. The 2% increase is affordable and reasonable, and gives the state and the county a base for it’s budget to be built upon. The business owner will be able to allot funds within it’s operating budget for the tax that they will owe and the employees may, repeat, may just be able to get a raise. Everyone wins.
Please take the time to call or email the delegates and let them know you want this bill.
I support this House bill 653 for several reasons, and I want to clarify what it will do and not do for Harford county and the state of MD. The bill limits the increase of home property owners taxes. Remember last year when we had the TEA parties,( April, May and June, and July) to encourage the county council to reduce the tax rate from 9% to 5% increases? The citizens of our county spoke and were heard, loud and clear by the council members and the reduction of property taxes happened. Thank you all who helped and spoke to these needs.
Part of the reaction to the citizens input was the bill that Mr. Whitely and Mr. Passara of Md for Fair Property taxes presented to the ways and means committee, to establish a task force commission, for studying the assessment process. That bill will is also under consideration.
The House Bill 653 has the support of our county delegates, and the Ways and Means committee in Annapolis had some questions and seemed to listen to the presenters, on Feb. 25, and when we finished, the committee seemed to consider the proposed bill. Now the citizens of the state need to call or write or email and let the delegates know that the property taxes are a problem, especially for our older citizens. Note in the bill as written, if a spouse dies, the property assessnment taxes cannot be increased due to the death, and the living spouse or children won’t be re-assessed due to the death of one of the owners. This will definitely help our seniors to either sell or keep their homes in a very trying and painful time. The HB 653 is also a strong plan for the tax base of the county. The county will be able to budget for the expected income and the homeowners and businesses will be able to adjust their spending accordingly. The bill is is also relevant to our county now with attention to the second point Mr. Mallamo makes re: gov’t actions that effect property values, the full property tax levied on the purchase price could be much greater than the costs of a property transfer costs. With the influx of BRAC and all of the new roads, developments and new folks, the prop. taxes that will affect both the current and new home owners within our county. The base rate of assessment cannot go above either 2% or the consumer price index, and that will lower property taxes. The lower taxes will allow the county to plan accordingly.
Please take the time to contact our representatives. Numbers do make a difference.
For the record, I am married to Mr. Leonard N. McGrady, Sr. and we work and live within Harford county, MD. We are the proud parents of 4 children, and grandparents of two. This bill will positively impact all of us.