The tax differential for Chesapeake Beach and North Beach — Calvert County’s two incorporated municipalities — will remain at 33.6 cents per hundred dollars assessed value for Fiscal Year 2012, according to action taken by the Calvert County Commissioners Tuesday.
The tax differential is essentially a deduction on the county tax rate given to residents of incorporated municipalities because those municipalities perform services that would normally be done by the county. As a result, the county tax rate will drop from 89.2 cents per hundred dollars assessed value to 55.6 cents.
Town residents pay their town taxes — for FY 2011, 37 cents and 59 cents per hundred dollars assessed value in Chesapeake Beach and North Beach, respectively — on top of the county rate. In FY 2011, that made for total tax rates of 92 cents per hundred dollars in Chesapeake Beach and $1.146 per hundred dollars in North Beach.
“The tax differential is very beneficial to both towns,” said Chesapeake Beach Mayor Bruce Wahl. “We have lost hundreds of thousands of dollars in revenue because of lowering real estate assessments, and also lost highway revenue from the state.”
Chesapeake Beach is retaining the same tax rate for FY 2012 through use of the “rainy day” fund and budget reserves, “but we can’t do that for long,” said Wahl.
North Beach Mayor Mark Frazer noted that his town had a 13 percent drop in real estate tax revenue due to lowered assessments, “and our constant yield rate jumped from 59 Cents to 67 cents.” The “constant yield” is the rate that will yield the same revenue as the year before. Frazer said his proposed budget will increase the property tax rate, but not to the 67 cent level.
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