Drastic Tax Cap Ballot Proposal Threatens Baltimore’s Future, New Analysis Finds
Drastically cutting and permanently capping Baltimore City’s property tax rate would have disastrous consequences for city residents, according to a new report published today by the Maryland Center on Economic Policy (MDCEP). The charter amendment proposed by the “Renew Baltimore” campaign would ultimately force massive cuts to fire protection, violence reduction efforts, sanitation, school nurses, and other vital services. The report builds on a recent analysis by the city’s nonpartisan Bureau of the Budget and Management Research and MDCEP’s analysis of a similar 2022 proposal.
“Baltimore already faces fiscal challenges, and slashing property taxes would make these much worse,” said Christopher Meyer, MDCEP’s Research Analyst and one of the report’s authors. “There are a range of things we can do to strengthen Baltimore communities, support people having trouble affording housing, and ensure our tax system is as equitable as possible. Cutting public services and tying city leaders’ hands is not a path that will get us there.”
If adopted, the charter amendment would cost more than $600 million per year in lost revenue once fully phased in, according to nonpartisan city analysts – a 23% drop in general fund revenue compared to current expectations.
“Evidence from within Maryland and across the country demonstrates that drastic tax cuts and tax caps don’t deliver the economic benefits that proponents promise,” said Musaab Ibrahim, MDCEP’s Senior Research Assistant and the report’s co-author. “Rather, the service cuts required would likely make the city a less attractive place to live and do business.”
The report identifies other ways to make Baltimore City more affordable and vibrant, such as:
- Strengthen protections for low-income homeowners
- Create a renter’s tax credit and strengthen investments in affordable housing development and rental assistance
- Tax vacant properties, as allowed by a newly passed law
- Create local tax credits for working families, such as a local match to the state Earned Income Tax Credit
- Expand local jurisdictions’ revenue options so the city has additional mechanisms for funding public services
The full report is available at mdeconomy.org/baltimore-tax-cap
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About Maryland Center on Economic Policy
The Maryland Center on Economic Policy advances innovative policy ideas to foster broad prosperity and help our state be the standard-bearer for responsible public policy. We engage in research, analysis, strategic communications, public education, and grassroots alliances promoting robust debate and greater public awareness of the policy choices Maryland residents face together. mdeconomy.org
