[RP TownTalk] Tax Increase

Mon May 14 00:48:34 UTC 2007

Dear Town Talkers,

As a former Chair of the Finance Committee and a current member of the
committee,

I find the out-going Ward 1 Councilmember's analysis to be disingenuous.

The budget is divided into two parts: the operating budget and the capital
budget.

It is true that the operating budget gets a kicker if the assessable base
increases and the tax rate is not reduced.  But, we have this disgusting
habit of wanting to give our employees annual salary increases, that include
both a cost of living and a performance part.  Last year, the majority of
the Council decided that the COLA portion should match the amount shown by
federal statistics as the local increase.  Last year, that about 3.8%.
Above that, we offer performance increases or steps.  We adopted salary
charts with grades and steps for every town job. Also, last year, the
Council decided to meet the County's "living wage" policy.  Both of these
decisions affect how much it costs to operate.  Also, we operate a fleet of
cars and trucks.  Our fuel costs have not remained static.

On the capital side of the budget, the increase comes from the fact that we
executed loan agreements for our street and building projects that only
required one
payment in the July '06-June '07 fiscal year, versus two payments for the
remainder of each year of the 20 year loan.  Thus, Mr. Oppenheim already
voted with the rest of the council last June to increase this years taxes in
order to pay the debt.  That is 3.55 cents of the 4.6 cents he refers too.

You might also want to know:

One of the council members wanted to tax you for both payments last year in
order to not cause "tax shock" this year when the full rate kicked in, but
the majority rejected that idea.  We decided to only tax for what was to be
actually spent during the year.

Of course, there might be some reduction in people's taxes if everyone paid
their fair share.  On tax day in April, I wrote about all of the home based
businesses in Riverdale Park that do not pay for business licenses or
tangible property taxes. Why do these people think that they are above the
law?

If you want to pay lower taxes, please let us know what services to cut.  Of
course, as we cut services, your County taxes will increase to off-set our
cut because the County gives a discount for the services that the Town
provides.

Gerry Kiernan
Ward 5 Councilmember

From: Rob Oppenheim <rob.oppenheim at comcast.net>
Reply-To: rob.oppenheim at comcast.net
Date: Sun, 13 May 2007 17:20:53 -0400
To: TownTalk <towntalk at riverdale-park.org>
Subject: [RP TownTalk] Tax Increase

 The mayor's proposed budget for Riverdale Park has a  24% average
increase in property taxes.  Some of this increase comes from a
rise in assessments and some comes from a tax rate increase.

Thus, if your assessment doubled (as many did) then your taxes
will more than double - although this increase may be phased-in
over several years.

 What can you do?

While the above increase is surprisingly large, it is appropriate to take
a calm and careful look at the proposed budget and judge it accordingly.

You can discuss this with the mayor and your council person (it is the
new incoming council that will actually adopt the budget in early June.)

You and I can learn more about how this money will be spent and
you can express your opinions at the public hearing on the budget...
 The public hearing on the budget will be Monday May 21 at 7:30 p.m.
 at Town Hall. I hope to see you there.

If you have the patience you can also read the rest of this email.

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(scroll down to see more)

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 The Rate Increase.

Ideally, the town would have lowered its tax rate to offset the increase
in assessments. Instead, the proposal is to actually raise the tax rate
from 64.1 to 68.7 cents (per $100 of assessed value).

This rate increase comes on top of the increase in your assessment.

As an example, if your assessment went from $200,000 to $400,000,
then your town property taxes will more than double, going from $1,282
to $2,748, an increase of $1,466 per year.

 The Homestead Credit Phase-in.

Thanks to the Homestead Credit Act, most owner-occupied homes
will see this increase automatically phased in over several years.

The act phases-in large assessment increases at 10% per year.
However some housing, such as rental housing and houses that
were recently purchased are excluded - for them the full increase
is immediate. 

Homes that qualify for the Homestead Credit will see about an 18%
increase in the Riverdale Park portion of their real estate taxes - roughly
$200 to $400 more per year plus an increase in the state and county
property taxes too. NOTE: This estimate could be way off. (Your total
real estate tax bill is roughly triple the Riverdale Park amount.)

You can learn more about the Homestead Credit on page 17 of the March
2007  Town Crier . Which is available at Town Hall or online at www.rptc.us
Below is a direct link to that Crier (then scroll down to page 17).
 http://www.ci.riverdale-park.md.us/rptc/2007/Crier2007-03.pdf

 Budget Details

To learn more about the budget, you can look at the attached file, which
has parts of the proposed budget in it. The budget report is 7 pages long.
It is not available to me in electronic form, so I entered two of the pages
(the summary page and the revenue page) into a spreadsheet manually.
I also added information to clarify the tax change.

The proposed budget for the next fiscal year is available at town hall in
paper form. Perhaps if citizens request it, then the budget will also be
posted on the web site (as it was last year).

You can learn more about the county assessments and the constant
yield tax rates here:
http://www.gazette.net/stories/050307/prinnew174541_32323.shtml

 Why I released this email

I have a lot more to learn about this budget proposal. I decided to
release this email now because I felt it important to give as much
notice as possible to our citizens.

Rob Oppenheim
Outgoing Ward One Councilman, Riverdale Park

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