• Release ID: 08-098
• Release Date: 6/20/2008
• Contact: Jocelyn Rawat 240-777-7967
• From: Office of Nancy Floreen

Montgomery County Councilmember Floreen Hosted Public Forum on
June 19 On County’s Reliance on Property Tax Forum Generated Debate and Consensus

ROCKVILLE, Md., June 20, 2008—Montgomery County Councilmember Nancy Floreen (Democrat-At Large) held a public forum on Thursday, June 19, in Rockville to generate new ideas that would help decrease the County’s reliance on property tax to fund annual budgets.

Councilmember Floreen and fellow panelists held a spirited debate about the County’s options for funding services in light of the revenue projections.

Panel members included Blair Lee, CEO of Lee Development Group; Gino Renne, president of UFCW Local 1994 MCGEO; Marvin Weinman, president of the Montgomery County Taxpayers League; Rollin Stanley, director of planning for the Maryland-National Capital Park and Planning Commission; and Art Spengler, former staff director at the Montgomery County Council.

Panelists fielded questions from audience members that represented a variety of interest groups, including labor, agriculture and education.

“This panel represents tremendous depth and breadth of knowledge, and I am grateful to the members for taking the time to discuss this important topic,” said Councilmember Floreen, who chairs the Council’s Transportation, Infrastructure, Energy and Environment Committee. “It is our constant struggle to balance needs for infrastructure and services with our available resources, so I’m glad we had this chance to look at new ideas.”

To set the stage for the evening’s panel discussion, Montgomery County’s chief economist, David Platt, provided an overview of the County’s current economic status. He explained that although the County still experiences one of the strongest local economies in the nation, there are some signs of recession, which means decreased revenue for funding county services.

Platt’s analysis told the forum that this year’s reduction in the construction of new residential properties means there is no growth in the property tax base. In spite of having one of the lowest unemployment rates in the country, Montgomery County did not experience any job growth over the past year. Because of that, any increase in income tax revenue would have to come from increases in salaries and wages, but it is unclear whether, or how much, salaries may grow. Other economic indicators point to similar conclusions about the County’s projected economic performance over the next year.

Many panelists suggested that growth drives the economy and looked toward sustainable industries, such as the energy, education and health fields, for enhancing the local financial system. They suggested investing in infrastructure to support this type of growth and criticized the sharp increases in impact fees, stating that the fees, in conjunction with the increased sales tax, increased corporate income tax and a sagging economy, have brought growth to a standstill.

Others suggested alternate funding mechanisms, such as a nonresidential commuter parking tax or creative public/private partnerships. In October 2007, the Working Group on Infrastructure Financing suggested that the County seek permission from the Maryland General Assembly to levy new taxes or increase existing ones.

The panel was in agreement that the County must get a better return from the state. Under the current tax structure and budget allocations, Montgomery County receives 19 cents for every dollar it pays into state coffers.

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