If you want to know who in Baltimore benefits most from the homestead property tax credit, look north.
Of the 100 biggest discounts in the city this tax year, more than 75 went to homeowners in and around the wealthy North Baltimore neighborhoods of Guilford, Roland Park and Homeland, tax records show. Another 15 or so recipients ring the waterfront.
The average break for these homeowners is $10,430, or 10 times the citywide average. As a group, they've avoided paying a combined $1 million this year. That accounts for about 1 percent of the $95 million not charged to 90,000 city owners under the homestead program, which effectively caps property tax increases in Baltimore at 4 percent a year for owner-occupants and yields the biggest benefits to long-term owners with the largest assessment increases.
The rankings illustrate the enduring stability of these high-end neighborhoods and the fact that the houses are expensive by Baltimore standards. On average, the state values the top 100 at roughly $1 million each, and for upper-end outliers, the pre-discount property tax bills can top $40,000.
The homestead credit — created in the late 1970s to insulate homeowners from spiking property taxes — went unmentioned by Mayor Stephanie Rawlings-Blake during her annual State of the City speech earlier this month. But it will have a bearing on goals she laid out in City Council chambers.
The mayor pledged to slash the city's sky-high property tax rate by 22 percent over 10 years. The cut would come on top of the tens of millions of dollars that the city gives up annually through the homestead credit. As The Baltimore Sun documented in 2011, the credit has also led to disparities that result in some recent buyers paying twice as much as neighbors who live in virtually identical houses.
Critics say the homestead program also discourages new residents, because buyers can't inherit sellers' credits, meaning they must pay full freight. A lower overall tax rate could help Rawlings-Blake achieve her aim of attracting 10,000 families to Baltimore over the next decade.
Rawlings-Blake's aides have championed the homestead as a fair reward for longtime residents. They also note that the homestead is a state program. But while state law caps increases in taxable assessments at 10 percent a year, local governments can go lower, and Baltimore has long set its cap at 4 percent.
The rankings don't reflect the city's new "Targeted Homeowner's Tax Credit," which debuted with last July's bills and essentially cut the property tax rate by just under 1 percent for owner-occupied homes. That credit is listed separately on tax bills.
As a map of the top 100 homestead recipients shows, one big cluster exists in southwest Roland Park. There is another on Blythewood Road, where 10 homes — a majority — rank among the top 50. Some of these homeowners have seen tax bills cut by 60 percent under the homestead.
Easily the most surprising entry on the list comes from Central Avenue, east of downtown. It's an unusual home that was created out of what had once been an Enoch Pratt Library branch.