Baltimore City - Property Tax - Authority to Impose on Vacant and Abandoned Property Owned by Nonprofit Organizations
The proposed legislation is expected to impact state laws concerning property taxation by legitimizing the imposition of taxes on previously exempt vacant and abandoned properties owned by nonprofits. This shift aims to deter organizations from holding onto vacant properties without utilizing them, thereby encouraging their reuse or redevelopment. Proponents of the bill argue that this would lead to more effective use of land within Baltimore City, contribute to community revitalization efforts, and increase property tax revenues that could support local services.
Senate Bill 550 seeks to empower the Mayor and City Council of Baltimore City to establish a subclass of real property, specifically targeting property owned by nonprofit organizations that has not been used for its original purpose for at least 35 consecutive taxable years. This initiative is part of a broader effort to address the issue of vacant and abandoned properties in the city, aiming to create a mechanism for levying property taxes on such properties which, under current law, may not be subject to taxation due to their nonprofit status. By establishing this subclass, the bill would allow for a special property tax rate to be imposed, which could significantly alter the financial landscape for certain nonprofits.
General sentiment around SB550 appears to lean towards support among those who prioritize property tax reform and urban revitalization. Advocates assert that by addressing vacant properties, the bill could stimulate economic growth and community engagement. However, there are concerns from nonprofit sectors about the financial impact this legislation may have, as nonprofits are often dependent on donations and may struggle to pay increased taxes, which could lead to a reduction in the valuable services they provide to the community.
Despite the momentum behind SB550, notable points of contention arise regarding the criteria for defining 'significant improvement' and the fairness of taxing nonprofit organizations that serve the public good. Critics argue that the bill may disproportionately affect smaller nonprofits that lack the financial resources to maintain their properties. Additionally, the potential for increased taxes could lead to some organizations liquidating assets or scaling back services, ultimately impacting the vulnerable populations they support. This highlights an ongoing tension between municipal property management goals and the operational realities of nonprofit entities.