In the northeast part of Howard County, where homes were reassessed last summer, 94 percent of homeowners saw a reduction in the assessed value of their residences.
That means most homeowners in that area will see a reduction in their property tax bills for the next three years until the homes are reassessed. But that's not good news for the county, which relies on property tax revenues for half of its general fund budget.
County budget administrator Ray Wacks presented the assessment data to the County Council Monday, Jan. 9. Overall, he said the area saw a 12 percent decline in assessments, slightly more than officials were predicting.
Despite declining assessments, property tax revenues are expected to remain level, Wacks said.
"What's driving that is a combination of new construction, increases of commercial development and people who are buying houses and phasing into their higher value," he said.
Wacks said the real key to whether the county will have a good or bad budget year will be income tax revenues, which make up more than one-third of the general fund.
"We're looking for some growth out of income tax, which will keep us from being in a horrible situation," he said.
Income tax revenues were up 11 percent year-over-year in November. But the real measure, Wacks said, is what income tax figures will look like in February. He expects the growth will not be as high as it was in November.
Given the revenue forecast, Wacks said the administration is asking county departments for "status quo budgets," with the only growth coming from fixed increases, like increased costs of energy and gasoline, etc. Departments are currently preparing their budget requests for fiscal year 2013, which begins July 1. County Executive Ken Ulman will take the requests into consideration when preparing his capital and operating budgets, which he must submit to the council in April.
Other factors will come into play later in the budget season, as the county waits to see what state funds will look like. The General Assembly is expected to again consider shifting some of the costs of teacher pensions to the county, which Wacks said "could blow all of our assumptions here that we have on the table out of the water."Copyright © 2015, The Baltimore Sun