Baltimore Assessments Accidentally Subsidize Blight–and How We Can Fix It

I want to point out that this is not really about revenue generation but about fairness -- the law requires that property be valued at market value, and so that's the policy that should be followed.

As for revenue, that's a political decision. The thing is that elected officials control the tax rate, not SDAT. SDAT only values the properties.

Rising property values don't have to mean rising taxes, the elected officials can lower the tax rate in response -- this what the term "no new revenue rate" is for.

It's also not just about pushing tax burden onto vacant lots. When property A is undervalued relative to property B, property B picks up more of the property taxes. So if a lot of vacant land is undervalued, that means a lot of improved land is paying more taxes proportionately. It seems sub-optimal that property where nobody lives is given a tax subsidy and the difference is realized in rising taxes for everyone else.

The main point is that the law requires that everyone be valued at market rate. That should be done first. Then any special case exemptions, write-downs, discounts, and the tax rate itself, should be handled at the political layer, where they are explicit and conscious rather than implicit.

We can debate what the relative impact of this is in the big picture, but this seems like something that is worth fixing.

> Speculation is less profitable than development, If you're getting speculation it's because the roi vs risk of development isn't justifiable.

Arguably, speculation should always be unprofitable and we should ideally regulate against it in every way, shape and form. I'd ask what purpose does holding onto a unproductive piece of land serve at all to society beyond an easy to grease financial vehicle?

Oh, don't worry, we have some lovely storage facilities here. It's just that there's only so many that you can build.

I'm not sure that the city owning a lot of land is actually a bad thing, compared to the current situation where it just sits there and rots. It's not like Baltimore has the best results doing things, but the alternative is clearly very bad.

The city doesn't have to own the lots long-term. They could divide them among neighboring lots.

The solution is to tax the land value rather than property improvement value. Any particular improvement from a property owner isn't taxed ... though implicitly the whole neighborhood getting more expensive (via the aggregate of all improvements and increased demand) does raise your tax.

Based and Georgism-pilled.

It's worse than that. If you sit on the property, but your neighbours improve it, make it a better place to live, create businesses that attract people, OR the public treasury builds a park, or a metro stop, or a new road, your property value increases, letting you capture the value that others worked for!

> If I do nothing to my property, my taxes stay the same.

I wish that was the case, but in both counties I've owned houses, the tax appraisal increases every year regardless. They don't even drive by, they just use automation to increase it. I protest every year and "win" which means the increase is reduced or eliminated, but it's a fight to keep your taxes the same regardless.

You are somewhat correct, even though I’ve never heard anyone say that or allow it to affect their decision in a major way. I do also suspect you may be in a place that is under rather oppressive government regulation.

The problem is a far more fundamental one, because just as I’m trying to get people to understand related to this movement or initiative to do away with property taxes, certain government and asset holder support for that is likely more about personal enrichment and/or expanding total tax receipts by other means, i.e., ulterior motives.

The fundamental issue here is the very premise of how the tax system functions not what kind of taxes are stolen and extracted where; and then redistribute to whom, usually for corrupted reasons and purposes.

The effectively unlimited and unbounded, detached, and inconsequential nature of the tax system now is really the core problem. It’s currently other people’s money and mostly even future people’s money, squandered without any meaningful limits, barriers, or even rules regarding conflicts of interests; and there are virtually zero actual and real, immediate consequences for malfeasance by people charged with the duty of responsible allocation of funds. It’s a corrupt and rotten system from the very top to the very bottom.

Unfortunately not enough people care, understand, or might even like it because they benefit from it and think they will die before the music stops. That’s how we get $37 trillion in national realized debt, another $74 trillion in unfunded liabilities, and another $9 trillion in state and local debt for a total national debt of $120 trillion in America’s public debt burden as of today.

That works in a functioning community.

In a place like Baltimore, the city ends up owning the blight, and are generally not capable of effectively cleaning it up (due to their general mismanagement that causes an environment where blight is the norm in the first place).

Rising property values don't necessarily mean higher tax bills if the property tax rate falls to match. You will see terms like "no new revenue rate" that reflect this.

The point of the article is not "Baltimore should raise more taxes" -- raising more revenue is a political decision, and that is not actually under SDAT's purview. SDAT's job is simply to assess property at market value. What to do with that value is for the elected officials (and the voters who elect them) to decide.

If property A is undervalued relative to property B, property B faces an unfair burden of taxes, and property A receives an unfair tax break. That's all this report is trying to say -- all property should be assessed at its market value, as the law requires.

Any exemptions, discounts, write-offs, and the tax rate itself, are political decisions. Those should be made explicitly by elected officials, not implicitly by unequal valuations.

I don't know about that. We live in a city where people are complaining about housing costs and availability, but the city has absolutely vast amounts of housing. We've lost close to 40% of our population since 1970.

It's just that a lot of that housing is in awful shape, and the places where it exist aren't desirable neighborhoods (although let's be clear, many of them are right next to expensive and desirable neighborhoods, it's really bad.) This should be a situation that rights itself automatically, but it's not.

> So this is all about getting the town to assess lots at higher valuations and this way raise tax revenue which in turn will raise town’s ability to spend for itself.

That is one angle of view. Alternatively, you could be encouraging vacant lot (or equivalent structure) owners to sell if neighbors are improving properties while they are not.

If the taxes on a vacant or condemned lot increase, but stay the same on a livable residential structure, how does that increase the cost of living?

Alternatively raise taxes on empty lots and reduce them on occupied lots.

This isn't really meaningful if the area is "subsidzed" by having a powerful economic engine nearby (baltimore, harrisburg). Suburbs aren't really sustainable in isolation for the most part

Yes, usually big systemic problems happen because someone in government did something unexpected, and they did it to grift money. The big systemic problem will therefore continue as long as the root cause has utility for grift.