Email Your Councilmembers and Tell them NO Recordation Fee and Transfer Tax Increase

Earlier this month, Councilmembers Opel Jones and Christiana Mercer-Rigby introduced legislation to raise recordation fees. The county executive also introduced legislation to raise transfer taxes.

Meanwhile, the county administration choses not to raise nearly 250 DPZ, DPW and DILP fees, among others, for the 20th year in a row, because it would impact the development community during the economic crisis. Not to mention the Moderate Income Housing Fee-in-Lieu, which is not market based increased by a mere 0.02 cents. So the economic crisis warrants deferring fee increases on the development community, while the taxpayer is fair game. This is unfair and against accountability.

The process lacks transparency. The two pieces of legislation are significant and affect the entire county. Yet, the sponsors introduced them buried in a pile of a whole host of routine, perfunctory fiscal resolutions under the auspices of this unprecedented crisis while people are not paying attention. This hurts accountability and open government. Its like activating a fire alarm in a theater, and rummaging through people’s belongings left in the theater.

The recordation fee fiscal impact analysis uses 2019 housing data and applies the new fees to determine the expected revenues. We still don’t even know how the pandemic’s public health fall out will affect our daily lives let alone the impact on home sales.

Also, many of those who opposed or resisted raising school surcharge fees for years citing affordability as a concern are claiming the opposite with respect to the effect of increasing the recordation fee even though the fee reduction only affects homes sold at less than 250k, which are a small share transactions. Meanwhile, the average home sale will see an increase anywhere from 30 to 50% in recordation fees, while transfer taxes will increase by 50%. So for a home that costs $500,000 the recordation and transfer taxes will increase from $7,500 to $11,000. A 50% increase.

Speaking of affordable housing, the advocates of this tax increase also want to build a so-called cultural center by giving Howard Hughes corporation nearly $70 million of high risk debt, using taxpayer credit. The machinations of the deal are as always complicated and are intended to confuse us. Here is the bottom line, this deal would allow HHC to effectively reduce its affordable housing obligation under the 2016 Downtown Columbia plan.

Specifically, the 2016 plan obligated HHC to build nearly 1,000 affordable homes under the first tax increment financing (TIF) deal. The cultural center is part of a second TIF deal, with additional affordable housing requirements. But HHC is now counting the new set of homes as part of the 2016 deal.

Instead of holding the special interests accountable by charging the right fee levels, the consumer and taxpayer is being asked to cover the shortfalls due to decades of poor budget accountability, developer subsidies, and pet projects like the so-called cultural center.

Email the county council and tell them to vote against the transfer tax and recordation fee increases.