Ocean City Today

Worcester County agrees to OC tax differential meeting

Request approaching 20th year; must occur 90 days before ‘19 budget adopted
By Brian Gilliland | Dec 07, 2017

(Dec. 8, 2017) As it has since 1999, the Town of Ocean City has formally requested a meeting with the Worcester County Commissioners to discuss a proposed tax differential that would return to the city some portion of the taxes paid to the county for services Ocean City also provides.

A letter to that effect from Mayor Rick Meehan was made public by the county on Tuesday.

State law does not require the county to issue a tax setoff to the resort or any other municipality in Worcester when its property owners pay county taxes for services that are duplicated by the municipalities.

However, the county is required to submit financial records and other documents to a town that requests a differential. It also must designate appropriate policy and fiscal officers to meet and discuss the nature of the request before the annual budget is adopted.

According to Harold Higgins, chief administrator of Worcester County, the meeting must take place 90 days before the budget is adopted, which puts the meeting in March, at the latest.

Previous meetings, Higgins said, have included himself, the board president and the resort’s representative county commissioner. This year, that would include newly elected president Diana Purnell and Joe Mitrecic.

The delivery on the request, if the county is inclined to oblige the question, can take two forms: the difference between the general property tax rate and the tax rate in the relevant municipality or a payment to the municipality to fund similar services or programs.

Two studies, one funded by the county, and the other by the resort, show some degree of differential is warranted. The county study found $7.8 million in duplicated services, while the resort’s study found $17.1 million.

Based on the county study, Higgins found the Ocean City tax rate would decrease three cents per $100 assessed value, while the rates outside of the resort would increase 5.7 cents per $100 assessed value.

Resort officials have maintained there are other options to get to a proper amount of relief, such as adjusting fees associated with collecting and processing room or food tax revenues.

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