"To our surprise, we recently discovered that the problem has not been corrected," wrote Douglas Brown, then the city's public policy analysis supervisor, in a 2001 memo to Edward J. Gallagher, who was deputy finance director and later department chief.

A city lawyer advised finance officials to "leave the mistakes of the past in the past," Brown wrote, and to focus instead on ensuring "correct credit calculations going forward."

Key players from the era remain deeply involved in tax credit programs. The memo said that city officials had pointed out the errors to Charles, who at the time ran the SDAT city office and is now the agency's No. 2 official. The memo was copied to Raymond, then an official in the city Finance Department and now its deputy chief.

Raymond declined to be interviewed, insisting on written questions. As of July 1, he said in an email, the city will take over the job of annually computing the historic credits. Charles said the city should have done that all along, because the historic credit is a city program, but that it lacked resources to do so.

Looking ahead, Raymond said the department's "billing integrity unit," set up last year to ferret out tax credit violations, will "consistently" monitor the credits.

Charles maintains that, in a majority of cases, the credits were computed correctly. But he acknowledged that his agency has yet to do a detailed analysis.

He said the state is in the process of fixing the incorrect credits and will send that information to city officials "so they can present revised bills to the property owners where necessary."

As for the spreadsheet glitch, Charles said, "That's something being worked on currently and will be corrected for the upcoming tax year" — which starts next month.

Baltimore Sun reporter Jamie Smith Hopkins contributed to this report.



About this series

The Baltimore Sun's series about taxes began with the creation of a comprehensive database of more than 230,000 tax bills, compiled using a computer program that "scraped" the information off the city's website one record at a time. For this article, The Sun also examined work sheets used by state assessors to calculate tax credits, which revealed millions of dollars in potential taxes lost through chronic errors and miscalculations.

Other findings of The Sun's "Taxing Baltimore" series:

•Lax city and state oversight of the homestead credit — a tax break enjoyed by most city homeowners — allowed hundreds of owners to get multiple discounts not allowed by law, costing the city and state hundreds of thousands of dollars.

•Hundreds of houses listed in city records as vacant also got the homestead credit, which is supposed to be granted only to people who live in their homes.

•A tax discount for low-income homeowners has been granted to a doctor, a lawyer and others who bought homes worth $300,000 or more, while thousands of lower-income homeowners get no discount.

•Below-market tax assessments for unsold waterfront condos at the Ritz-Carlton Residences and Silo Point developments have cost the city more than $10 million in lost taxes.

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