Friday, May 23, 2008

Thoughts on the Mortgage Crisis and Property Tax

On May 21 I had a rare opportunity go down to Capitol Hill to testify before the Domestic Policy Subcommittee of the Oversight and Government Reform Committee of the U.S. House of Representatives on the Neighborhood Stabilization Act of 2008 (HR 5818) dealing with the sub-prime mortgage crisis. It was great to speak to former local government officials (Chair, Rep. Dennis Kucinich was former Mayor of Cleveland) and talk about the critical issue of protecting neighborhoods from the risk of homes being abandoned due to foreclosure.

Speaking on behalf of the National Association of Counties, the United States Conference of Mayors, the National Association of Local Housing Finance Agencies and the National Community Development Association, I had the opportunity to point out that even in a relatively affluent community like Montgomery County, the foreclosure rate had increased 800% over last year. While our numbers are nothing like those in places like Flint, Michigan, they certainly are worrying.

I also mentioned my long term concern about how the potential for deteriorating property values can affect our ability to provide necessary services due to our heavy reliance on the property tax for revenue. (This basic issue is indeed shared across the country.)

That leads me to my next question for my constituents.

Now that we have concluded our struggle with the budget, what are your suggestions for decreasing our reliance on the residential property tax to fund government services? In this last round of budget review and tax raising, I cannot, for the life of me, see how we can go any further. Certainly many Montgomery County residents have e-mailed me to say we have gone too far already. Others have said thanks for funding a service that is important to them. But finding the right balance between desired services, and our ability to pay, is the inevitable and constant struggle in the budget.

Do you have any good ideas on what policies we should pursue in the coming year to keep us from demanding any more from the residential property tax base? I personally cannot see how reducing employee compensation in order to add more services is fair or even doable, but I am all ears as to your suggestions.


Anonymous said...

I was very proud to hear you on C-SPAN radio this afternoon during the committee meeting on the hill. The committee weren't the only ones to learn from your comments. No suggestions yet, but I'm thinking, I'm thinking. I know you have your finger on the pulse of this issue.

Foreclosure said...
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Anonymous said...

How is the CASA of Maryland funded? I don't see it mentioned in any of the budget documents. Plus the budget documents should all be consolidated as one PDF or download (zip).

Anonymous said...

I'm sorry, but there is just no excuse for increasing spending and funding the county employee pay raises when the rest of us are getting no raise at all while watching every other expense go up. Yes, services are great, but we just can't keep spending! The budget should be cut, not increased. I have reached the end of the line and I am looking to move my business, along with a couple of dozen jobs, out of Montgomery County to someplace where government understands how to say "no" to spending requests.