The news is that many decision-makers are concerned about Baltimore's weak competitiveness with other cities. One main reason is the real estate tax rate is twice as high as the rates in the surrounding counties. It is obviously a factor when companies or people choose where to locate, and Mayor Stephanie Rawlings-Blake is working to reduce the city tax rate 20 cents by 2020 ("Backsliding on Baltimore's property tax," April 1).
The problem is that Baltimore is one of the very few large cities that are not part of a county and the city tax rate is artificially high because the city boundaries have not been changed or extended since 1918 — almost 100 years ago. Practically all of the new suburbs developed since 1918 — after both World Wars — are paying taxes to the counties. Plus, the city retains most of the problem neighborhoods and the major non-profits and educational institutions which pay no taxes.
The 1918 boundaries separate the huge suburban tax base from the property tax base of the city and their tax rate is therefore about one-half the city rate. It seems nonsensical, but there is state legislation requiring an expansion of the city boundaries to be approved by the residents of the territory to be annexed, a practical impossibility.
Apparently, any cure of this would require statewide legislation — meaning a statewide vote in the legislature which is also a practical impossibility today.
But there is an answer that has been used elsewhere: Tax Base Sharing or TBS. This might be done by the city in a contract with one or more of the adjoining counties to share the tax base more equally, thus evening out the rates in each which could drastically reduce the rate in the city.
It has been done in other places such as Minneapolis and St. Paul and the Meadowlands in New Jersey. In comparison, the mayor's 20 cents by 2020 may appear small. Of course, it would require an unprecedented campaign to convince a majority of voters in an affected county that it is a good idea for them.
That is theoretically possible, and this may actually be a good time with major new, taxable developments going up in both the city and the counties. Maybe, if there were a moratorium on new tax subsidies for developers, there could be only minimal tax increases in the participating counties.
Still too hard? Think of the stakes — correcting the city's artificially high tax rate and therefore its competitiveness for new jobs over the next how many years?
Martin L. Millspaugh, Baltimore