The State Department of Assessments and Taxation (SDAT) is required by law to establish a Constant Yield Tax Rate for each county and local jurisdiction. This is an important consumer protection tool for notifying homeowners when jurisdictions decide to raise more revenue.
As property values rise, total tax revenues increase if counties choose not to adopt the Constant Yield Tax Rate. When a jurisdiction chooses not to adopt the Constant Yield Tax Rate, the jurisdiction must advertise its intent to do so and conduct a public hearing to discuss the increased tax revenue.
Any increase in revenue that is generated by adopting a real property tax rate that is higher than the Constant Yield Tax Rate is a tax increase, even if the adopted tax rate is the same as the previous year's tax rate.
While SDAT assesses the value of your property, the jurisdiction determines how much tax you will pay.
*Note:* Municipalities are exempt from the advertisement and public hearing requirements if maintaining the previous year's tax rate will generate less than $25,000 of additional revenue above the amount of revenue that will be generated by applying the Constant Yield Tax Rate.
*Example: * The total taxable assessment for the *City of Baltimore *was $41,027,419,000 on 7/1/2020. The tax rate was $2*.2480 *per $100 of assessed value resulting in real property tax revenue for the *City of Baltimore* of $922,296,379.
The City of Baltimore decided to maintain the current tax rate and not adopt the Constant Yield. The total taxable assessment for the *City of Baltimore * was $41,587,521,000 on 7/1/2021. Maintaining the current tax rate resulted in a tax increase which raised *$12,591,0093* in new tax revenue.
If the City of Baltimore decided to adopt the Constant Yield Tax Rate, this would have resulted in maintaining the current tax revenue.