by Rick Rybeck, Just Economics, LLC
As 2024 begins, so does the 2024 Session of the Maryland General Assembly. After several failed attempts, we are tantalizingly close to obtaining permissive legislation to allow Baltimore (and Maryland counties should they so choose), to tax land and buildings at different rates. How did we get to this point? And what are the key opportunities and challenges to our success?
2018 – President Trump, the CGO Conference, and “Tiger” Davis Provide a Spark
In 2018, the CGO Conference was held in Baltimore. One of the speakers, Clarence “Tiger” Davis, a local Baltimore man, was a state delegate between the early 1980s and the early 2000s. During the 1980s or 1990s, he introduced legislation to allow Maryland jurisdictions to implement land value taxation. He spoke very passionately about the need for Georgist reforms. In 2019, President Trump made very disparaging remarks about Baltimore. Walter Rybeck thought that, with Tiger Davis’ leadership, perhaps Baltimore could set an example for other cities rather than be an object of derision. Walter convenened a number of Georgists (including Mike Curtis, Ed Dodson, Mike O’Mara, Allana Hartzok) and Clarence Davis to get the ball rolling. Unfortunately, Clarence Davis was preoccupied by other commitments and Walter Rybeck became too ill in early 2021 to continue convening the group. Fortunately, Alanna Hartzok took the helm. In addition to convening the group, Alanna has raised funds and recruited Vanessa Beck to become our local organizer. Vanessa, originally from Chicago, had already taken a Georgist course and was motivated to help out her new home town. Thus we created “Baltimore Thrive” to promote affordable housing, job creation and equitable blight reduction in Baltimore.
If I go to a meeting where folks are complaining about a lack of affordable housing, unemployment, blight, etc., I can stand up and say, “A land value tax could solve these problems!” But all that folks will hear is the word “tax.” They know that taxes are bad and that they don’t want a new tax. So they won’t hear anything else I say (including that the land tax is not a new tax). My proposal will be dismissed without debate. Change is always hard. Why use vocabulary that makes it harder? We looked for better language. I had developed “Land Value Return” for a 2018 Transportation Research Board project as an emotionally friendlier and more intuitive wording for our concept. Alanna suggested calling the implementation mechanism a “Land Value Tax Shift” so that folks won’t think that we’re proposing a new tax. So far, these vocabulary choices appear to be working well.
Crisis Can Be Opportunity
Time and again, Vanessa would contact organizations and activists. They were often sympathetic to the Tax Shift policy. But they were too caught up in their own campaigns to go down this new path. In 2022, “Renew Baltimore” enters the scene as a well-funded organization promoting a 50% property tax rate cut referendum. The property tax rate in Baltimore is about twice as high as in the nearby suburbs, so cutting the tax rate in half makes sense to many residents. Renew Baltimore almost collected the signatures necessary for a referendum. This kept them off the ballot in 2022, but we knew that they would return in 2024.
During 2023, Baltimore politicians were in a cold sweat about Renew Baltimore’s referendum. On the one hand, they knew that Baltimore would be devastated by a 50% cut in property tax revenue. On the other hand, as politicians, they couldn’t tell their constituents who were paying high property taxes, “Just vote ‘No!’ Support the status quo.” They felt that they were between a rock and a hard place. They were keeping quiet and sitting on their hands.
Baltimore Thrive approached some of these politicians by offering a viable alternative to the tax cut proposal. A revenue-neutral Tax Shift could reduce taxes for most residents and many businesses – but without decimating Baltimore’s ability to fund basic public goods and services. Baltimore Thrive developed a one-page explainer for the Tax Shift, including the need for state legislation. We also developed a press release titled, “The Tax Cut Mirage versus the Tax Shift Solution.”
Opportunity on the Horizon – We Need Your Help
As we enter 2024, some officials in Governor Moore’s administration are sympathetic. But we have not yet been able to get the Governor’s endorsement. This endorsement could be critical to passing the necessary State enabling law. We have met with State delegates and senators. Most of them are sympathetic. But, none of them have yet committed to introducing our legislation. We met with the Baltimore Finance Director. He said that he wants to see this legislation introduced. But we’ll have to see if he can get sponsors and co-sponsors in the Maryland House and the Senate.
Josh Vincent has obtained funds for a video. Ed Dodson generated a story board for it. And Josh is also crunching some numbers to provide concrete examples of what various properties would pay in tax under the status quo, the Tax Cut, and the Tax Shift. Alanna has also hired a web developer to help Baltimore Thrive create its own website. The website should be up and running by end of January.
Recently, it has come to light that Maryland’s transportation budget is over $2 billion short of anticipated needs over the next few years. Baltimore Thrive is hoping that we might convince State transportation officials that “land value return” could help fund transportation facilities and services in an equitable way – from the landowners who are now reaping windfall profits from these public investments.
If you have contacts with officials in Governor Moore’s administration, the City of Baltimore, the Maryland Legislature, statewide public interest groups, the Baltimore media, or in Baltimore social justice and anti-poverty groups, we would love getting an introduction from you. Do you know any Maryland county officials who might benefit from this policy? Of course, we can also use volunteers to contact local activists and attend meetings. For more info, contact Vanessa Beck at firstname.lastname@example.org or by phone at (410) 457-3111.
Rick Rybeck, Director
Just Economics LLC
1669 Columbia Rd., NW, Suite 116
Washington, DC 20009-3625