The property owners' opportunity to be heard on the issue of property tax rates before they are final.
Although setting of the local property tax rates is the task of elected officials, Maryland's Constant Yield Tax Rate Provision gives property owners a voice in the process before the final tax rates are determined. This is done by requiring each taxing jurisdiction to give advance notice and hold public meetings prior to the rate setting if they are considering a tax rate higher than the Constant Yield Tax Rate. Most meetings are held during April, May and early June. Tax rates must be set by July 1, which is the beginning of the tax year.
The Constant Yield concept is that, as assessments rise, the tax rate should drop to the point that the revenue derived from the property tax stays at a constant level from one year to the next, thus assuring a "constant yield" from this tax source. The Constant Yield Tax Rate is simply a property tax rate that, when applied to new assessments, will result in the taxing authority receiving the same revenue in the coming taxable year that was produced in the prior taxable year.
The Constant Yield Tax Rate is a State Law that exists solely for the benefit of the taxpayer. It represents a clear and direct opportunity for citizen input to influence the level of property taxation.
Prior to February 15, the Department of Assessments and Taxation notifies the counties, Baltimore City, and municipal taxing authorities of the tax rate that would produce the same revenue from the property tax as was produced the year before. The rates certified to the local governments are known as the "Constant Yield Tax Rates" and are based on the new, net assessable base for that jurisdiction. New property or construction added to the rolls for the first time is subtracted from the calculation and allowances for abatements and other deletions are deducted in arriving at the net assessable base for this purpose.
The local taxing authority cannot set a tax rate that exceeds that Constant Yield Tax Rate until first advertising its intent to do so. The notice must meet certain specifications. The taxing authority may, at its option, mail a copy of the notice to each taxpayer instead of publishing an advertisement.
The taxing authority must meet on the day and time shown in the notice. This meeting must be held between 7 and 21 days after the advertisement is published. The hearing must be held on or before June 17th. Afterward, the taxing authority may adopt a resolution or ordinance adopting a property tax rate in excess of the Constant Yield Tax Rate, but if the ordinance or resolution adjusting this tax rate is not approved on the day of the public hearing, the day, time, and place where the resolution or ordinance will be scheduled for consideration and approval must be announced at the public hearing.
The Department of Assessments and Taxation is charged with the responsibility of administering the Constant Yield Tax Rate Provisions. In addition to calculating the rate, the Department also oversees and monitors the advertising requirements. If violations are detected, the Department must report them to the Attorney General who must investigate and take appropriate legal action to effect compliance.
To obtain the Constant Yield Tax Rate for a particular municipality or other local taxing jurisdiction, contact your local assessment office or see the Constant Yield Tax Rate chart on this web site.
