- The Washington Times - Monday, January 9, 2006

RANDALLSTOWN, Md. — Gov. Robert L. Ehrlich Jr. yesterday announced plans to use a nearly $2 billion budget surplus to cut the property-tax rate and expand tax relief for the working poor and senior citizens.

“It is the appropriate time to do something proactive [and] substantive, particularly for the working class and working poor,” Mr. Ehrlich, a Republican seeking re-election this year, announced at a senior center.

He proposed reducing the property-tax rate by 2 cents, to 11.2 cents per $100 assessed value. In 2003, the Board of Public Works approved his plan to raise the property-tax rate by 5 cents, to 13.2 cents per $100 assessed value.

The governor yesterday said the state’s finances have improved over the past three years, noting that he called for the property-tax increase to preserve Maryland’s AAA bond rating and shore up a $2 billion deficit he inherited from Gov. Parris N. Glendening, a Democrat.

“We’re talking about a $1.7 billion surplus, and soon in Maryland there will be … 100,000 net new jobs created,” Mr. Ehrlich said. “We have a hot state. We have a state people want to live in. We have a state people want to move to.”

He also called on county and municipal officials to cut local property taxes, which average $1 per $100 assessed value and account for nearly 90 percent of a homeowner’s tax bill, according to the administration.

“If a tax cut is appropriate, do it because it is needed,” he said. “That’s my suggestion.”

The lower state property-tax rate would save the owner of a $205,889 house — the average assessment last year — about $41 on the annual tax bill.

Mr. Ehrlich also proposed overhauling the property-tax credit program, which limits the cost for low-income homeowners.

The Ehrlich administration said that overhauling the program, which has not been altered significantly since its creation 16 years ago, would reduce the property-tax bill for the average low-income homeowner by about $167.

Proposed changes include capping household income at $55,000 for eligibility and increasing the maximum eligible home assessment from $150,000 to $300,000.

The governor also proposed altering the credit formula to increase the income level exempt from property-tax payments from the first $4,000 to the first $8,000 earned by an eligible homeowner.

“I like it,” said Beatrice Shapiro, 78, who was present when Mr. Ehrlich made the announcement. “On the last property tax, I had to dip into our savings.”

Mrs. Shapiro, who with her husband has a fixed income of about $26,000 a year and owns a $100,000 home in Pikesville, would receive a $600 tax credit, $100 more than last year, under the proposed changes.

Delegate Emmett C. Burns Jr., a Baltimore County Democrat whose district includes Randallstown, were there for the announcement and said the proposal “sounds good.”

But he said his support would depend on the position taken by the legislature’s Democratic leadership.

Several key Democrats have stated their opposition to a property-tax cut. They include Comptroller William Donald Schaefer and State Treasurer Nancy K. Kopp, who with the governor make up the Board of Public Works.

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