Mayoral candidate Otis Rolley unveiled a plan Tuesday that he says would cut property tax rates for most homeowners by more than half in a decade.
Rolley's plan would keep property tax rates at current levels for commercial properties, including rental homes and apartments, and dramatically increase rates for vacant plots and buildings. He would also tax homes worth more than $200,000 at a slightly higher rate-- but only on the portion of the home's value that exceeds $200,000.
Rolley said that the increased revenue from blighted buildings would compensate for some of the revenue lost by the tax cuts to residential properties. He said he would also trim to city government, but did not specify which cuts he would make.
"There is enough fat within [city government] to enable us to do what we need to do," he said.
Rolley, the city's former planning director, is the third candidate to release a detailed plan to cut property taxes.
Mayor Stephanie Rawlings-Blake introduced a proposal last week that would reduce property tax rates for homeowners by 9 percent over nine years.
Former Greater Baltimore Board of Realtors vice president Joseph T. "Jody" Landers has unveiled a plan that would model Baltimore's tax structure after the District of Columbia, where vacant and blighted properties are taxed at much higher rates.
State Sen. Catherine Pugh has pledged to cut the rate in half in four years, but has not detailed the specifics of her plan.
The city's property tax rate, which is more than twice that of surrounding counties, has become a key issue in the mayor's race, which, in heavily Democratic Baltimore, is all but decided by the September primary.
Rolley said that he would put his plan on the city's ballot, so that it could not be discontinued at the whim of a future mayor. He hopes that new residents will be drawn to the city with the promise of forthcoming tax cuts.
Rolley would create five different rates at which properties would be taxed. Owner-occupied homes worth less than $200,000 would be taxed at $1.10 per hundred dollars of assessed value, after a decade of gradual reductions. .
Homes worth more than $200,000 would be taxed at $1.75, but only on the portion of the value that exceeds $200,000.
Commercial properties and vacant, but well-tended homes, would be taxed at the city's current rate for all properties-- $2.268. Blighted vacant lots would be taxed at $5 and blighted homes would be taxed at $10.
Rolley said he would lobby General Assembly to allow the city to tax different classes of properties at different rates; Rawlings-Blake would also need the state legislators to do the same.
But Rolley's plan to tax homes at $200,000 at a higher rate could be complicated by a provision of the state constitution called the "uniformity provision."
In 1977, then- Attorney General Francis Burch issued an opinion in response to a proposal from Gov. Marvin Mandel to tax properties at various rates. Burch wrote that the varied tax rates could cause a "uniformity problem," and that "an argument might be made that the tax liability is not uniform with respect to property value."
Dan Friedman, the attorney general for the general assembly, said that this portion of Rolley's proposal could require a state or city referendum.
Rolley's campaign manager Dan Fee said Rolley planned to advocate for the laws to be changed.
"Otis believes that the toughest change isn't a change in the law, but a change in people's belief that Baltimore's best days are behind it," he said.
Steve Hanke, a Johns Hopkins University economics professor, praised Rolley's dramatic cuts, but said that the plan was overly complex.
"His program is way too complicated," he said. "If you do economic reforms, this is not the way to redesign them."
But, Hanke, who has advocated for sharply dropping the city's overall property tax rate, said he preferred Rolley's proposal to Rawlings-Blake's.
"Rolley has clearly diagnosed the problem correctly," he said.
