MD Supreme Court explains decision to block ballot question on Baltimore property taxes

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The Maryland Supreme Court on Tuesday explained its decision to block an effort to slash Baltimore City’s property tax rate via ballot question.

Baltimore’s property tax rate — currently at 2.248%, by far the highest in Maryland — would have been incrementally slashed to 1.2% by fiscal year 2032 if voters approved a ballot measure sponsored by a group called Renew Baltimore.

The group, which was led by Baltimore real estate broker Ben Frederick and investment manager Matthew Wyskiel, had the backing of many local businesspeople and former local elected officials. It argued a lower tax rate would drive investment in the city and grow the local economy. Mayor Brandon Scott and others said the plan usurped their power to set the tax rate and would be “catastrophic” to the city budget.

The Maryland Supreme Court in August upheld decisions by the Baltimore City Circuit Court and the city Board of Elections to keep the proposal off ballots in last November’s election. They deemed the proposal not to be “proper charter material,” because voters are not allowed to set tax rates.

In an opinion published Tuesday, Justice Steven Gould, writing for the unanimous majority, wrote that the power to set property tax rates rests with the mayor and City Council, not with the voters. He added that the proposal violated the Home Rule provision of the Maryland Constitution — not because the state would be infringing on the rights of the city government, but because city residents would be.

“Because the Property Tax Amendment was initiated by the voters, it would have violated (the law),” Gould wrote.

Gould discussed the court’s 1992 decision in Board of Supervisors of Elections of Anne Arundel County v. Smallwood, in which it approved a local ballot question to cap the tax rate but blocked other proposed tax-related ballot measures, as well as another case related to ballot questions affecting tax rates.

Gould wrote that while the cases “provide useful and interesting discussions on where to draw the line … between lawful and unlawful voter involvement in setting property tax rates, here, we have the added wrinkle of (the Baltimore City Charter), which prohibits any voter involvement.”

Chief Justice Matthew Fader fully agreed, but wrote a concurring opinion, joined by Justice Brynja Booth and retired Judge Glenn Harrell Jr., who was substituting for Justice Shirley Watts. (Harrell was a judge on the high court, then known as the Maryland Court of Appeals, from 1999 to 2015.)

Fader wrote separately to suggest the court may want to reconsider its 1992 decision in Smallwood. He favorably cited a concurrence in that decision, in which the judge “found untenable the distinction the Court’s majority drew between the two mechanisms, both of which imposed limits on the amount of revenue the county councils could authorize.”

“It is not necessary to revisit the Court’s opinion in Smallwood to decide this case, so I am in full agreement with the Majority’s decision not to do so,” Fader wrote. “But the day may come when the Court is called upon to reconsider Smallwood. If that day comes, we should be open to the invitation.”