Don’t bur­den tax­pay­ers with Trade­point hand­out

Baltimore Sun - - NATION & WORLD - Kevin Bruf­fey, Cock­eysville

Imag­ine Bal­ti­more County Coun­cil mem­bers telling their con­stituents that $100 mil­lion in tax dol­lars will go to im­prove a busi­ness dis­trict in the eastern part of the county. Their con­stituents would be out­raged. Know­ing how con­stituents re­gard taxes, pol­i­cy­mak­ers have got­ten creative over the years. In ev­ery elec­tion, there are nu­mer­ous bor­row­ing mea­sures on the bal­lot. Those who strongly re­sist in­creases in pub­lic ex­pen­di­tures and taxes for that mat­ter op­pose th­ese pro­posed mea­sures.

Now, it seems the cre­ativ­ity never ends. The lat­est scheme is tax in­cre­ment fi­nanc­ing or TIF. They’ve been used to fi­nance projects in­clud­ing the Metro Cen­tre in Owings Mills and the Bal­ti­more Hil­ton among oth­ers in the re­gion. Now pol­i­cy­mak­ers are propos­ing a TIF to fi­nance roads and wa­ter and sewage in­fra­struc­ture in Spar­rows Point to as­sist Trade­point At­lantic as an al­ter­na­tive to di­rect sub­si­dies (“Trade­point At­lantic to scale back re­quest for gov’t fi­nanc­ing in re­de­vel­op­ment of steel mill site in Bal­ti­more County,” Oct. 19).

It’s worth not­ing that three of Trade­point At­lantic’s ten­ants have al­ready re­ceived or at least ar­ranged to ob­tain $60 mil­lion in sub­si­dies from the fed­eral, state and county gov­ern­ments. Pend­ing ap­proval by the Bal­ti­more County Coun­cil, bonds will be is­sued to­tal­ing up to $100 mil­lion to fi­nance in­fra­struc­ture in Trade­point’s busi­ness com­plex. The bonds would be paid back through a por­tion of the prop­erty tax rev­enues gen­er­ated by Trade­point. Un­like di­rect tax­a­tion, tax­pay­ers also con­trib­ute to in­ter­est pay­ments owed to the bond­hold­ers mak­ing the project even more ex­pen­sive while con­tribut­ing to a re­la­tion­ship be­tween county of­fi­cials, in­sti­tu­tional in­vestors and well-con­nected busi­ness in­ter­ests

Here’s some­thing im­por­tant to con­sider when as­sess­ing this ar­range­ment’s po­ten­tial im­pact on in­di­vid­u­als and busi­nesses through­out Bal­ti­more County. Sup­pose a com­pany in Sparks does ex­traor­di­nar­ily well in a par­tic­u­lar year re­sult­ing in a higher tax base. Think, too, about an in­di­vid­ual in the com­pany who gets pro­moted and sees their pay in­crease re­sult­ing in a higher tax base as well. This means that both the com­pany and the em­ployee would pay more taxes to Bal­ti­more County for that year.

Now, imag­ine if the em­ployee was a con­trib­u­tor to one of the County Coun­cil mem­bers’ cam­paigns and ar­ranged a deal that would al­le­vi­ate him from pay­ing ad­di­tional taxes re­sult­ing from his pay in­crease. He then could take th­ese funds and spend it on him­self any way he chose. Any­one who found out about this ar­range­ment would be out­raged.

Well, that’s es­sen­tially what Trade­point’s ten­ants will get away with if the TIF ar­range­ment is passed. The prop­erty taxes they gen­er­ate will go to­wards a project that will ben­e­fit them while ev­ery other busi­ness in the county will con­trib­ute prop­erty taxes for the ben­e­fit of the county.

While it’s ad­van­ta­geous for busi­ness growth to oc­cur through­out the county, poli­cies shouldn’t fa­cil­i­tate growth which re­lieves some of their re­spon­si­bil­ity and cre­at­ing a bur­den for oth­ers.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.