Bel Air May See Tax Increase For First Time Since 2004

BEL AIR, MD — For the first time in 17 years, Bel Air residents may see a tax hike.

The first draft of the FY 2022 budget was presented to the Bel Air Board of Town Commissioners at a virtual town meeting Monday night by Town Administrator Jesse Bane. He said a capital project to renovate the town hall and police department on Hickory Avenue was a factor.

"Taxes were last raised in Bel Air in 2004," Bane said in presenting the budget proposal. "The increase at that time was 6 cents per 100 of assessed value."

Despite the cost of services, materials, benefits and personnel increasing, Bane noted there had been no tax increase in 17 years. This year he is proposing a smaller tax hike than the one in 2004.

"My budget proposal provides for a 4-cent tax increase for $100 of assessed value," Bane said. "Three cents of that 4 cents will pay for the debt on the proposed Town Hall/police building, and 1 cent of that 4 cents is dedicated to the general fund. For every 1-cent tax increase, as you know, the town will realize $154,000 in total revenue."

The current tax rate is 50 cents and $1.16 per $100 of assessable value of real and personal property taxes. Bane's proposal now is to raise the rate to 54 cents and $1.20 per $100 of assessable value, respectively.

Bane said the budget proposal he presented was "bare bones"and reflected $747,000 in cuts from the initial request he received for personnel, capital and general fund expenses in the town.

This year he said the town faced several challenges in terms of reduced revenue. Highway user revenue Bel Air normally receives from the state decreased for the second year in a row, he said.

"The tax rebate we received from Harford County also decreased," Bane added.

Here are some other reasons the town needed to raise revenue, according to Bane:

• Interest on investments has fallen
• Medical insurance premiums increased by 14.2 percent
• Dental insurance premiums increased by 15.1 percent
• Workers compensation costs will go from a .70 discount to 1.02

In addition, the Maryland Department of Assessments and Taxation "anticipates a large number of appeals due to the negative impact of COVID on income," Bane said of commercial properties. "There is a potential to significantly reduce our revenue stream," he said.

"I could go on to cite negative impacts caused by COVID, [the] opioid crisis, our water and sewer bills, et cetera," Bane said. "But we will dedicate our discussion to these other impacts during our budget work sessions and public hearings."

Two positions were added in the proposed FY 2022 budget proposal, Bane said:

• A new position in Bel Air Department of Public Works, titled construction worker two, that was cut from the budget in 2008 due to the recession.
• A new position in the police department to handle the Law Enforcement Assisted Diversion (LEAD) Program, partly funded by a three-year grant and money from the elimination of two part-time positions in the police department.

"Certainly this year's budget will generate much study and discussion, as it should, and ultimately commissioners will determine" what the final budget for the next fiscal year will be, Bane said. "I placed much thought and hard work in preparing my proposal. But in the final analysis, I find this proposal necessary if the town hopes to continue to provide the same level of services our constituents have come to expect as citizens and business owners in our town."

Town commissioners will drill down into the makeup of the budget, Commissioner Pat Richards said Monday night, clarifying this was a draft document.

A town budget must be approved for FY 2022 by June 1.