Mayor Scott wrong to reject property tax reduction plan

As a city resident, it is disappointing to read that Mayor Brandon Scott’s administration finds Renew Baltimore’s property tax reduction proposal “absurd” (”A new group wants to slash Baltimore’s property taxes in the name of equity. City Hall calls it ‘absurd,’” June 21). Prior to being elected, the mayor campaigned on promises of “a new way forward,” departing from status quo solutions and vowing to make difficult and unpopular decisions, even if that meant he would not be reelected. Yet, in the face of what should be this administration’s flagship economic policy reform, the mayor and his cabinet adhere to a failed status quo solution without specifying why specifically Renew Baltimore’s proposal is so absurd or how the proposal could potentially be reworked.

I imagine this administration is well aware that Baltimore, in order to make up for tax base loss from white flight to suburbs post-World War II, raised its property tax rate 19 times in 25 years and has effectively taken no action on the high property tax rate in almost 50 years. This is not forward-thinking economic policy.

Also falling short are the assertions that referencing property tax rate reduction as an equity issue is performative and second, that reducing property tax rate is a “gentrification cocktail.” The developers and corporations that receive large tax breaks and subsidies to build projects in the city are generally not minority-owned and tend to build real estate projects in areas of Baltimore that are not significantly minority-populated. However, the tax burden is left on the shoulders of small businesses, renters and homeowners in the rest of our majority Black city. Furthermore, if reducing the property tax rate is a gentrification cocktail, then the status quo should rightly be called out as a “disinvestment cocktail,” as developers, businesses and potential homebuyers have little interest and see no economic benefit in investing in the crumbling, increasingly vacant sections of East and West Baltimore that Black residents are fleeing, especially in conjunction with a higher property tax rate than surrounding jurisdictions.

China Boak Terrell of American Communities Trust is correct in stating that everyone would be comfortable paying the higher taxes in Baltimore if it was a very safe city, with the best schools in the country. But amidst a 70-plus year trajectory of ongoing population loss, Baltimore’s current value proposition is that the city will charge residents at least double the price of its competitors (surrounding counties and other cities) for public services and, in return, the city will deliver a lower-quality product. That logic doesn’t fly in any rational marketplace and city residents are demonstrating this fact by voting with their feet and heading for the exits.

If the administration’s fears are that reducing the property tax rate might lead to reduced city services in the short-term, and displacement of lower-income Black residents as the city revitalizes, then now is the time to begin an honest effort of exploring partnerships and policy options that can help maintain city services and keep lower-income Black residents in their neighborhoods as the neighborhoods improve. For example, perhaps the state can provide Baltimore with a low- or zero-interest loan, or other financial assistance to help backstop any budget funding gaps that might occur as the lower property tax rates come online. California had such an arrangement with San Francisco when the city reduced its property tax rate. Also, Councilwoman Odette Ramos’ proposed bill to strengthen Baltimore’s inclusionary zoning law is an example of action that can be taken ahead of a property tax rate reduction to help protect lower-income Black residents from displacement.

Baltimore’s challenges are both social and economic. While city leaders routinely discuss their desire to see improved social conditions and quality of life in Baltimore, there seems to be minimal focus on Baltimore’s economic competitiveness and a lack of appreciation for how poor economic policy exacerbates historical inequities. It should be understood that, over time, a more economically competitive Baltimore with an growing tax base is better resourced to help address poor social outcomes. A lower property tax rate moves us in a more economically competitive direction and I would challenge the mayoral administration to take a more collaborative approach to Renew Baltimore’s proposal in order to truly chart a new way forward for the city.

— Jay Louis, Baltimore

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