Tax Hike Passes Test Vote in Montgomery

The Montgomery County Council gave preliminary approval yesterday to a hefty increase in taxes for developers and builders and authorized a new way of measuring whether an area is too congested with traffic for development.

In a series of test votes on changes to the county's growth policy, a five-member majority solidified around proposals they say will tighten controls on development and allow some growth. Final action is expected Tuesday.

The council backed plans that would, for example, increase the transportation tax that pays for roads or transit on a new single-family detached house from $6,264 to $10,649 and increase the schools tax that pays for classrooms on the same house from $9,111 to $20,456.

The tax plan was backed by a majority, with members Michael Knapp (D-Upcounty) and Nancy Floreen (D-At large) abstaining, and Roger Berliner (D-Potomac-Bethesda) and Valerie Ervin (D-Silver Spring) absent for the vote. Council member George L. Leventhal (D-At large) missed the day-long session because he is recovering from injuries sustained last week in a car accident.

Council members Phil Andrews (D-Gaithersburg-Rockville), Berliner, Marc Elrich (D-At Large), Marilyn Praisner (D-Eastern County) and Duchy Trachtenberg (D-At Large) began coalescing late last week around a Berliner-Elrich plan to recalibrate traffic tests and require developers to pay extra fees to diminish the impact of their projects on roads and schools.

The council did find unanimity on one issue: Members backed an increase in the recordation tax paid at closing on real-estate transactions. Trachtenberg, who proposed the increase, said the plan could bring an extra $10 million annually to pay for rental subsidies and infrastructure.

She said she decided to support it because the measure exempts buyers of homes worth less than $500,000 from the increase, and because the council voted to use the money to pay for rent subsidies for moderate-income tenants, and to help pay for the county's infrastructure, such as roads and transit.

She had opposed the increase proposed by the Montgomery County Planning Board that would have paid only for schools and wouldn't have exempted home sales under $500,000.

County Executive Isiah Leggett (D) opposed an increase in the recordation tax, saying it could discourage first-time home buyers.

Yesterday's discussions, the second all-day session in a week, centered on council revisions to proposals from the county's planning board. The council, backed by planning board Chairman Royce Hanson, ignored Leggett's request for a six-month delay but did agree to convene a series of discussions among the council, planning board and executive's office to refine details of the transportation test.

Hanson said he was open to further discussion once the council approves a framework.

Elrich, who had studied the transportation proposals for months and helped Berliner craft an alternative, said he was pleased with the votes yesterday. "I think it went well," he said.