KENT COUNTY, MARYLAND
COUNTY COMMISSIONER'S

PUBLIC HEARING - 06/08/2004

 

PROPOSED INCREASE TO THE LOCAL INCOME TAX

June 8, 2004

In compliance with and pursuant to Section 10-106 of the Maryland Annotated Tax - General Code, the County Commissioners held a public hearing on Tuesday, June 8, 2004, at 6:00 p.m. in the County Commissioners' Hearing Room, County Government Center, 400 High Street, Chestertown, Maryland on proposal to increase the rate of the County income tax on an individual's Maryland taxable income from the present rate of 2.58% to a rate not to exceed 3%.

(For the record, if this proposed increase in the local income tax is approved, it would be the first time the County income tax was raised since May 19, 1970.)

County Commissioners William W. Pickrum, Roy W. Crow, and Scott D. Livie were in attendance as well as Susanne Hayman, County Administrator, Thomas Yeager, County Attorney, Patricia Merritt, Director of Budget and Accounting, and approximately six citizens and members of the media.

Notice of the public hearing was read into the record by Mr. Yeager, who also reviewed the procedures for testifying.

Testimony was then entertained by those individuals who signed the testimony log as follows:

- Ronald Hickman, of Rock Hall. Mr. Hickman expressed his objection to the proposed increase to the local income tax, noting that it would follow the raise in property taxes in the incorporated Towns of the County (due to change from a tax differential to grant-in-aid to the Towns), the raise in the water and sewer rates, and a proposed raise in the Hotel Rental Tax. He expressed his opinion that if increases in taxes continue, many of the people who have lived in the County their entire lives will no longer be financially able to do so.

- Richard Feeny, of Worton. Mr. Feeny identified himself as a "newcomer" to the County, a citizen of three years. He expressed his objection to the proposed increased in the local income tax, citing similar reasons as those identified by Mr. Hickman, adding the increase in the State real estate tax and the new "Flush Tax." Mr. Feeny cited an increase in the local income tax as being, in his opinion, a 10.47 % increase, which he described as "unconscionable." In order to meet the $300,000.00 needed in the proposed Budget for operating expenses, he suggested that County assets be sold, eg. the Bayside marina, the LaMotte Property.

Referring to Commissioner Livie's interest in increasing employment opportunities and attracting new businesses into the County, Mr. Feeny expressed his opinion that increasing taxes in the County will discourage businesses from choosing to come to the County.

Commissioner Livie spoke to clarify the intentions and goals of the Commissioners.

Pertaining to the concern raised about the increase in the water and sewer service rates, Commissioner Livie indicated that the County has an aging wastewater treatment system, and that, therefore, the Board was obligated to provide the County's citizens with a clean environment and clean drinking water. The necessary improvements represented a very expensive infrastructure. Commissioner Livie continued by reviewing the Board's rationale for instituting the universal rate for water and sewer services for all County citizens.

He noted the yearly increase in the amount of the General Fund that was used to subsidize the water and sewer rates, an increase that was born by the tax payers, because the subsidies came out of the County's operating budget.

Commissioner Livie indicated that, unless the Board took steps to adjust the rate, the General Fund would continue to be depleted unless it put a cap on it as a source of funding for the water and sewer services. He also indicated that the Board felt that it was in the best interest of the citizens, who are legally responsible as users to pay for the operating costs of water and wastewater services, that they absorb some of the increased costs of the needed infrastructure improvements, thereby alleviating the draw from the General Fund.

Addressing the concerns expressed about the County's purchase of the LaMotte Property, Commissioner Livie indicated that it was the Board's decision to purchase the property partly because it is in a key corner of the County, a "gateway" to the County, and he reported that the County in fact rescued that property from being purchased by a company as a site for the construction of a giant self-storage facility. He reviewed the history and rationale for the County's purchase of the property, and that the Board was assisted by the consultation of an advisory group selected by the Board. He indicated that the conclusion of the advisory group's feasibility study was that the LaMotte Property would be a great location for an economic development project, and suggested that it become a corporate campus for mixed economic use, for example small office spaces, retail shops, possibly a restaurant, and the rest of the property to be used, with the help of grant funding, possibly as a park and arboretum.

Commissioner Livie continued by expressing his belief that the development of the LaMotte Property as described would serve as an important economic stimulus to the County, by Public Hearing June 8, 2004 Page 3 creating the needed jobs providing living wages that would encourage the County's children and youth to decide to stay in the County to work and raise their own families. He indicated that the Board is well aware that the LaMotte Property is very valuable and, therefore, attractive real estate, given the interest in it expressed by many companies.

Commissioner Livie concluded his comments by stating in review that the Board has made the fiduciary decisions that it has based on its responsibilities to provide the County's citizens with clean water and intentionally planned economic growth.

The Commissioners will vote on the proposal for increasing the Local Income Tax on June 15.

This hearing was taped for reference and adjourned at 6:25 p.m. .