Dear Neighbors:
Here’s a link to the agenda for the April 24, 2019 City Council meeting: https://takomaparkmd.gov/meeting_agendas/city-council-meeting-agenda-wednesday-april-24-2019/. This meeting is focused primarily on budget and tax issues, with public hearings at 7:30 PM on both the proposed property tax rate increase and the proposed budget. After the hearings the Council will move into a “reconciliation” work session (where we discuss potential changes to the proposed budget and tax rate). Later, we may also have a brief discussion regarding an appointment to the Arts and Humanities Commission.
ANNNOUNCEMENTS
Coffee with a Cop. Thursday, from 9:00 - 11:00 AM at Mansa Kunda restaurant located at 8000 Flower Avenue. This is another in the ongoing series of opportunities to mingle informally with members of our Police Department. All residents are welcome.
Art Hop. This annual event featuring local artists’ works installed in an array of shops and restaurants in and around the Old Town business district will take place on Saturday, April 27 from 11:00 AM - 5:00 PM and Sunday, April 28 from 10:00 AM - 3:00 PM. http://www.mainstreettakoma.org/art-wine-hop-takoma-april-27-28/
Prescription Drug Take-Back. The Police Department will again participate in the Drug Enforcement Administration’s Nationwide Prescription Drug Take-Back Day on Saturday, April 27, 2019, from 10:00 AM - 2:00 PM. You can bring your expired, unused, or unwanted prescriptions to the Municipal Building. Collection boxes will be set up in the first floor Police Department lobby. Prescription, over-the-counter and pet medications will be accepted.
Update from Last week’s Council Meeting: The Council had been scheduled to vote on the resolution effectuating the land exchange between the City and the County to give us legal control of the New Hampshire Avenue Recreation Center. However, shortly before the Council meeting, the County asked for some last minute changes to the resolution’s language. The amendments don’t appear to make any major substantive changes. But rather than hurrying through action on a version of the resolution we hadn’t had time to review in a focused way, the vote was postponed until May 1, when I anticipate we’ll pass it with no difficulty.
Background on budget and tax issues: https://documents.takomaparkmd.gov/government/city-council/agendas/2019/council-20190424-1-2.pdf. I outlined the overall budget and tax situation in my blog post from April 10 (http://www.councilmemberkovar.com/blog/2019/4/9/april-10-2019-city-council-meetingbudget-update). As explained in that statement, the Council is reviewing the City Manager’s proposed Fiscal Year 2020 budget and property tax rate. The fiscal year begins on July 1, and in order to ensure that our financial actions mesh appropriately with the County’s, we generally strive to finish our budget and tax work by mid-May.
At this week’s meeting and on next Monday -- when we’ll have our final special budget session -- we’ll be discussing potential changes to the proposed budget and property tax rate (again, that’s our reconciliation process). We may begin to make tentative decisions on at least some changes this week and on Monday, though we won’t be taking any votes until next month. The final votes on the budget and tax rate are set for May 15. So this week’s public hearings are key opportunities for interested residents to let the City Council know your views.
As mentioned in my April 10 blog, if the Council can agree on net reductions to the proposed budget totaling approximately $650,000, that would enable us to keep the current property tax rate. A net reduction of around $730,000 would permit us to adopt what’s called the Constant Yield rate (the rate at which the City is estimated to bring in the same amount of revenue next year as this year). Of course the impact of any tax rate will vary from resident to resident. Those whose home values went down in the recently announced assessments (roughly 37 percent of Takoma Park homeowners), would pay less in City property taxes under either the current rate or Constant Yield. Those who saw increases in their assessments would pay more if the rate stayed the same as this year, with the specific change in the amount due determined by how much their assessments went up.
For a general gauge, with a home currently assessed at $500,000, if there’s no change to that number in the new assessment, the proposed property tax increase would result in an increase in the tax payment from $2,646 to $2,780, a rise of $134. I’m confident we’ll be reducing the rate below the initial rate proposed by the City Manager. Whether there’s support for bringing it back to the current rate or to Constant Yield is unclear at this point, but I’ll be working with my colleagues to seek reductions that will bring us toward that level.
An added complication for this year is that the changes in Federal tax law impose a cap on the deductibility of state and local taxes. That includes local property taxes. It’s not possible to make an across-the-board statement about the impact this will have on people’s net taxes, as there are a number of other factors, including cuts in Federal income and capital gains tax rates, increases in the standard deduction and certain exemptions, the elimination of other deductions, etc.
For me, this pushes in several directions. I’ll be working to cut back the proposed property tax increase as I mentioned, and my awareness of the potential negative impact of the changes in Federal law contributes to that effort. But at the same time, I’m reluctant to significantly scale back important services, programs and initiatives that provide valuable assistance to lower income residents or that help make Takoma Park a great place to live. That’s especially true given that I think one of the goals of the Republican-led tax bill was to make it harder for Cities and States (like Takoma Park and Maryland) that have activist approaches to government to continue doing so. In addition, even if we make reductions in spending, it’s possible that some Councilmembers may prefer to apply those savings to our unallocated reserves (which we’re working to build up to a larger percentage of our overall spending).
Finding a reasonable balance among all of those considerations is the challenge we’ll be working on over the next couple of weeks. I’ll have more to say about our choices as we move forward. Meanwhile, I’d appreciate hearing comments and ideas from Ward One residents on all of these topics.
Takoma Park City Council
Ward One
240-319-6281