Rain Tax repeal? Not really

You'll be hearing a lot of news reports that the repeal of Maryland's much-hated rain tax takes effect. Not really.

The law, enacted in 2012, required 9 counties and the City of Baltimore (because of its size) to pay for EPA mandated water cleanup - by taxing property owners for stormwater runoff.

Frederick and Carroll counties vehemently disagreed with the law. Frederick voted to charge property owners just 1 cent as an act of compliance-defiance. Carroll refused to levy the tax.

Some counties decided to charge a flat fee per property type:  single family home, multi-family dwelling, commercial property...

Others instituted perhaps the most derided fee calculation - one based on the amount of "impervious surface area".   We're talking about driveways, roofs, concrete stoops, patios, even swimming pools  - and for commercial property owners and HOA's - alleys, parking lots and sidewalks... all added up to tabulate each tax bill.

Montgomery County, Prince George's County and Howard County do it this way, and plan to continue despite the "repeal".  That's because the law only removed the REQUIREMENT that counties charge the tax. It didn't say they couldn't.

Montgomery County collected more than $24 million dollars in rain tax last year.  That's a lot to give up.

"The new law doesn’t negate the improvements that have to be made,” explained Dennis Enslinger, Deputy City Manager for the City of Gaithersburg.  Gaithersburg will debut its revamped  Stormwater Program Fee this month.

Under a pact with the EPA, Maryland agreed to reduce stormwater runoff (which contains pollutants) by 20% before it reaches the Chesapeake Bay. According to the Tax Foundation - New York, Pennsylvania, Virginia, West Virginia, and DC also signed on to the agreement.  Only Maryland hit residents with a tax to cover the cost.

Gaithersburg will follow Montgomery County's lead, and though it doesn't have to, will begin calculating the tax based on impervious surface units.

“Our philosophy is that this is the most equitable way of doing it,” said Enslinger. “We approached it like a utility, and this is the best way of ‘metering’ usage.”

Enslinger says the City’s stormwater improvement plan will cost between $25-$35 million over a 5 year period. The General Fund will contribute about $1.2 million a year, and property owners will pick up the rest.  It will be about $5 million the first year, and Enslinger admits is likely to increase from there.

Meanwhile, Harford County repealed its stormwater fees in January, and Baltimore County cut its fees by a third. They are following the spirit of the repeal law, rather than the letter. 

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