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ROCKVILLE, MD (June 14, 2022) — A new, bi-partisan coalition of citizens called Renew Baltimore aims to revive Baltimore City’s struggling economy by taking tax reform directly to voters.  Renew Baltimore proposes a referendum in the current election cycle to carefully lower the property tax rate over six years and cap it at a more competitive level.

The Maryland Public Policy Institute supports this effort and considers its success a necessary condition for a true renaissance of Baltimore.

Abundant MPPI research has shown the city’s non-competitive property tax rate to be at the root of many of its problems. Lowering the rate will not only make the city more competitive with the surrounding area and other large cities, but will greatly ease the inequitable burden that high property taxes place on low-income homeowners.

“Baltimore voters finally have a real chance to solve the city’s disinvestment crisis – and treat all the social problems that flow from it – by embracing a charter amendment that caps the city’s property tax rate at a more competitive, affordable, and equitable level,” said Dr. Stephen Walters, MPPI’s chief economist. “The Institute has long documented the destructive consequences of the city’s punitive tax rate:  it repels investment, restricts economic opportunity, increases poverty, serves as a barrier to wealth creation, and contributes to population flight that stresses the fiscal capacity of the city government.” 

Local officials have often tried to treat the harmful consequences of a property tax rate that is more than double that of any other Maryland County – and 2.5 times Washington D.C.’s rate – by offering special carve-outs to the tax. This referendum would, on the other hand, bring the tax burden down on behalf of all Baltimoreans.

“For many years, city officials have resisted MPPI’s call for a competitive tax rate for all Baltimoreans, instead defending a status quo that provides special tax breaks (TIFs, or other subsidies) to a favored few while ignoring residents and small businesses across vast areas of the city that have suffered chronic disinvestment,” said Walters. “History shows that this approach simply doesn’t work, and isn’t fair.  By signing the Renew Baltimore petition and voting in November to cap the property tax rate at a competitive level following careful rate reductions over the next six years, the citizens of Baltimore can reverse this pattern of flight and failure.” 

Nearly every major economic development project in the city in recent years has needed a special property tax carve-out. These offerings have not led to widespread growth in Baltimore.

Instead, a well-planned, phased-in tax reform program can be both fair to local home-owners and beneficial to municipal budgets and services.
 

The Maryland Public Policy Institute is a nonpartisan public policy research and education organization that focuses on state policy issues. The Institute’s mission is to formulate and promote public policies at all levels of government based on principles of free enterprise, limited government, and civil society. Learn more at mdpolicy.org.

                                                                                     
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