Recently, the Democratic members of the Anne Arundel County delegation put forward another tax and spending bill that will again encourage more residents and retirees to leave the county.
House Bill 933 would allow the Anne Arundel County Council to impose an increase on the rate of the transfer tax imposed on residential and commercial properties sold in the county.
In comparison to other Maryland counties, Anne Arundel’s low tax rates are an incentive for people to want to move here and stay here. Instead, our county executive looks at our low tax rates as the opposite, as an opportunity to overtax all of us, and in particular, our residents who contribute a large portion to our tax revenue. Renters will eventually absorb the tax increase.
Residents of Anne Arundel County already pay numerous fees and taxes including a recording fee, a state property tax, a county property tax, a Chesapeake Bay restoration fund fee, and a stormwater management fee. Additional fees may be added atop these universal charges as well depending on the nature of the property.
The current transfer and recordation taxes generated over $300 million for the county from Fiscal Year 2019 through Fiscal Year 2021. Revenue from real estate will contribute close to $1 billion to annual county coffers.
Though I am against tax increases normally, now is especially not the time for any tax increase. Unprecedented times is an understatement. COVID revealed to us that lower income and BIPOC (Black, Indigenous, People of Color) communities are systematically disenfranchised in many areas, and yet, our progressive county executive would put forth a financial obstacle for BIPOC communities to obtain equity.
This bill is opposed by the Maryland Building Industry Association, the Apartment and Office Building Association of Metropolitan Washington, Anne Arundel County Association of Realtors, and Maryland Realtors.
These taxes would drive up housing costs and Maryland currently has a housing affordability crisis. Imposing additional costs on Anne Arundel County real estate transactions would drive up the price of residential units, making it difficult for those units to be priced low enough that low-income buyers could afford them. This bill has no cap on how high the special transfer tax could get, which means who knows the damage it could do to the affordable housing market going forward.
Additionally, the commercial real estate market is in tatters. Small businesses, restaurants, and retail and office buildings are empty. Increasing the costs on real estate transactions not only disenfranchises new people coming into the market, but it will also add another financial burden on our vulnerable residents.
The county executive has no interest in cutting costs. He has verbally made it known that he wants to increase revenues by raising taxes.
If the county executive wants to start a Housing Trust Special Revenue Fund, then he should explain why he hasn’t used funds already available to him to do so. The real estate industry is generating millions in revenue, yet very little of those monies are going toward affordable housing initiatives. He is simply using this idea as a way to interject emotion into a basic supply and demand issue caused by the overregulation he has implemented. He is once again trying to pull the wool over the public’s eyes in order to raise taxes dramatically. This bill has no way of actually producing affordable housing but instead has the ability to limit it.
I want you to keep as much of your hard-earned money as possible. I want my constituents and others within the county to recognize how policy can change consumer behavior. Understand that taxpayers will bite the bullet, one way or another, if the government does not learn to live within its means. I encourage you to call every Anne Arundel County legislator to reconsider their position on this bill.