May 09--If the numbers look promising enough, there's a chance Frederick County residents could see a downtick in property tax rates.
Budget planning this year has so far assumed the property tax rate would remain unchanged, and county commissioners Thursday were poised to adopt the rate of $1.064 per $100 of assessed value. But after a short discussion, they instead opted to table the decision to see if a rate cut would be possible. First, they have to determine whether income tax revenue will be robust enough to offset the decrease.
Commissioners President Blaine Young first raised the possibility of cutting the property tax rate by 0.4 cents, enough to lower taxes by $10 for owners of a $250,000 home. Though some taxpayers might not notice the relief, Young said the change would demonstrate fiscal responsibility.
"It does show that when we get our hands on a dollar, we don't try to find a way to spend it," he said.
Because of rising property values, the slightly lowered tax rate of $1.06 would generate the same amount of revenue collected by the county the previous year. Adopting the current rate would yield about $750,000 more than the prior year, county staff estimates.
Commissioners are set to revisit the issue later this month after the county's quarterly income tax distribution. The distribution numbers will tell local officials whether it's safe to increase budget estimates for income tax revenue.
However, county budget officer Regina Howell said she has already raised the income tax revenue estimate when preparing the fiscal 2015 budget.
"I would hesitate to change it this late in the game," she said in an interview.
The drafted budget anticipates that income tax revenue will be 3.5 percent greater than for the prior year, she said. Revising the growth estimate to 4 percent would give officials an additional $881,800 of wiggle room in the fiscal 2015 budget, potentially allowing officials to forgo the $750,000 in property tax revenue.
However, cutting property tax rates would likely extinguish any hope of providing additional funding to county schools, Commissioner David Gray said.
The county's drafted budget funds the school system at maintenance of effort, the same per-pupil amount as last year and the minimum allowed under state law. Education officials have requested an additional $17.5 million beyond maintenance of effort, and teachers turned out in force at Tuesday's budget hearing to press commissioners for the money.
Before approving the increase, Commissioner Paul Smith said he wants to know how school officials would spend the funds.
"I want to know the price tag on the requests," he said Thursday.
Gary Brennan, president of the Frederick County Teachers Association, said school officials have outlined their needs in budget documents. The school system is asking for roughly $13.8 million for a salary pool to allow for pay increases and new positions. Health and dental insurance costs are estimated to increase by $3.9 million, and complying with mandates will require an additional $1.3 million, according to a school budget document.
Young said he is willing to give the school system an additional $400,000 or $500,000 if the Board of Education promises to use the money to raise starting teacher salaries.
However, Brennan said increasing pay only for new teachers would create disparities for teachers who have been with the system for two or three years.
Follow Bethany Rodgers on Twitter: @BethRodgersFNP.
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