State Senator George Della of the 46th District filed Senate Bill 889 a few days ago. The bill’s goals are to encourage vacant property owners to renovate their properties and to possibly generate enough tax revenue to lead to a reduction in the overall property tax rate. I think it is a good first step in altering Baltimore’s property tax structure. I do not think it will be able to generate enough revenue to lower the property tax rate in the city and I fear revenue that it might generate will be used on wasteful new programs. It is worth a try though.
I think it is also worth it to directly reward Baltimore homeowner occupants with a drastic property tax cut. I feel this would be the most beneficial move the city could make. Home ownership costs would decrease if the owner occupant property tax rate was dropped drastically and the result would be more interest in being a Baltimore city homeowner. Higher property taxes for vacant and uninhabitable real property in Baltimore will make investors think about selling or renovating but that does not necessarily mean new home owner occupants. If this bill becomes law then vacant and uninhabitable real property prices will drop and I feel that is a positive.
I received an email from a reader who does not like this bill. Here are his reasons (he describes why a supporter likes this bill at first):
“Basically what happened to him was he bought into a neighborhood that was half – three quarters redeveloped and paid a pretty penny for his place and
has high taxes. The real estate bubble burst and projects in his area went
on hold. It upsets him to come outside and see projects not completed. He
now wants these developers to pay higher taxes.
This is against everything I was taught about the tax system. And in general
is just vindictive. It also will make the rich richer and keep the poor
poor. Any fledgling developer will need more money to start into the market.
I just think it is a bad idea. I call it the “ugly tax” because if your
property is ugly it gets charged more.”
Adam is the most recognizable face of the recent resurgence in Reservoir Hill. He has appeared on many national and local radio shows, in several news publications, and at numerous events discussing his innovative urban redevelopment ideas and his unique lifestyle. Adam is a successful entrepreneur, community activist, and a local political guru who ran for city council in 2007. He is the founder and director of the TechBalt.com Buy a Block Project and BaltimoreHourly.com. His fearless local political commentary has rocked the local blog scene for most of this decade and he plans to take it to the next level in the next decade here on Charm City Current.
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Why is it that every time someone opposes a bill, they drag “the poor” into it? Sorry, but your correspondent’s logic is flawed for a few reasons.
Since he’s opened the door, I should point out that poor people are the most affected by blighted uninhabitable homes, since they don’t pop up in places like Federal Hill or Roland Park at the same rate as say along Greenmount Avenue or Washington Boulevard. The bill has no ability to “keep poor people poor”, as poor people generally do not own entire tracts of real estate they purchased as investments. The bill will, however, give the City the ability to clean up these properties by forcing the slumlords to pay their fair share of taxes that will include additional money that should be used to pay back the City for their added burden on City services such as fire, police, and Department of Housing.
“Developers” who oppose this bill for the reason stated (it will make their startup costs higher) — perhaps if they didn’t let their properties sit vacant, as havens for illegal activity and health hazards, perhaps this bill would have never been introduced. If this bill means that the predatory negligent “investors” leave town, than all the better. It opens the door for homeownership by residents and not out-of-town speculators who pillaged our housing stock with their poor business tactics.
Finally, if your correspondent had bothered to actually read the text of the bill, he would have read that the bill only applies to the worst of the worst — structures that have been deemed “vacant and uninhabitable”.
If your e-mailer bothered to read the legislation, he would have noticed the following paragraph:
“6–302.1.
(A) IN THIS SECTION, “VACANT AND UNINHABITABLE REAL PROPERTY” MEANS REAL PROPERTY THAT
(1) IS UNOCCUPIED BY THE OWNER OR A TENANT OF THE OWNER;
(2) HAS BEEN CITED AS VACANT AND ABANDONED ON A HOUSING OR BUILDING NOTICE FOR AT LEAST A PERIOD OF 1 YEAR.”
That means that for a property to be charged under this higher tax rate, it would have to be vacant and abandoned for at least a year. If a property is abandoned, then it most likely means that the so-called “developer” doesn’t really have any plans to fix it and is just crossing his fingers in the hope that another housing bubble will occur.