Tax Formula Approach Is Right Direction

There was a lot of predictable ingratiating in Snow Hill this week, but privately a battle will unquestionably ensue over Ocean City’s proposed agreement that calls for large increases in funding from the county.

The six-page Memorandum of Understanding created by the Town of Ocean City seeks to do away with the entire discussion of tax differential, which refers to services Ocean City taxpayers fund for the county but do not utilize because the town provides its own. Instead of seeking an unrealistic large amount of money to account for the tax differential — equated to about $17 million by a recent study — the town is proposing a funding formula that over time brings equity to the town’s tax contributions when compared to the percentage of grants the town receives on an annual basis from the county.

Equity is sorely needed for Ocean City property owners. The numbers do not lie. For the current fiscal year, Ocean City submitted about $67 million in total property and income taxes to the county and received 4.56 percent of it back in a grant, totaling $3 million. Compared to other municipalities, it’s clear there is a problem. Berlin received $702,000, which represented 22 percent of its total taxes provided to the county, while Pocomoke received 24 percent and Snow Hill about 71 percent.

What these numbers confirm is what has always been known. Tax dollars from Ocean City sustain the rest of the county and in particular help fund public education. Some may not have an issue with that, but there is no question Ocean City property owners have an unfair burden because they are facing double taxation by paying the county for a multitude of services they do not receive from the county.

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