Reducing the burden caused by the state’s property tax for homeowners is the goal for one Carroll legislator this session.

For the second straight year, Del. Susan Krebs, R-District 9, has introduced legislation that would reduce the state cap on the Homestead Property Tax Credit from 10 percent to 5 percent.

“I don’t think it’s fair for the state to continue to take 10 percent from property owners,” Krebs said.

On Wednesday, the House Ways and Means Committee is scheduled to hear testimony on the bill at 1 p.m.

Property is assessed every three years by the state, and the assessed value is phased in over three years. With the Homestead Property Tax Credit, the increase is capped at 10 percent for the state tax for an owner-occupied property each year.

Krebs said the cap is too high, especially since the majority of Maryland counties and Baltimore City have set caps for county property tax lower than 10 percent.

“The state should have taken the lead,” she said.

In Carroll, the property tax cap is 7 percent. The bill would not impact local property tax caps.

Tiffany Lundquist, communication director for AARP Maryland, said property tax is the most burdensome tax for low-income households and seniors because it is not based on income or whether the person is able to pay the tax.

“Any relief to the property tax rate for the older Marylanders living on a fixed income would be beneficial,” Lundquist said. “With costs going up all around it would help homeowners of all ages.”

The bill was introduced last session, but did not move out of the House Ways and Means Committee. Krebs said she is optimistic that the bill will pass this year. She said it normally takes more than one legislative session to get a bill of this nature passed.

With the cap reduction, the state would see about $40 million less in anticipated revenue in fiscal year 2010, according to an analysis by the Department of Legislative Services. Krebs said she doesn’t think the fiscal impact will be a factor in the passage of the bill, especially since she believes the state should reign in its spending.

At the state level, property tax revenues are used to pay the state’s debt service, according to the analysis. In fiscal year 2009, about $745 million is budgeted for general obligation debt service costs, according to the analysis.

Reach staff writer Beth Ward at 410-751-5908 or beth.ward@carrollcountytimes.com.

OTHER LEGISLATION

Sen. Larry Haines, R-District 5, introduced legislation that would prohibit the State Department of Assessments and Taxation from requiring the use of Social Security numbers in the application for the Homestead Property Tax Credit.

Haines said driver’s license numbers, the address on car titling and voter registration could all be used to verify addresses. He also said the penalty of $5,000 and up to three years in jail for lying on an application will ensure accurate information is provided.

Legislation is also under consideration that would repeal a bill from last session that requires homeowners apply for the Homestead Property Tax Credit. Previously, the credit was automatically applied.