Howard County Executive J. Hugh Nichols has recommended increasing the 1987 operating budget while sharply reducing the property tax rate, a juggling feat he said is possible because of new building construction, steadily increasing population growth and low inflation.
The proposed $150 million budget, a 7.2 percent increase over last year's, sets next year's property tax rate at $2.19 per $100 of assessed property value, down 30 cents from the current rate.
The decrease in property taxes would mean that, with a 3 percent rise in the assessment value for next year, taxpayers would save about $102 on their tax bill on a $100,000 house, said David White, a budget analyst for the county.
In a written statement, Nichols said the property tax rate reduction is possible because of "continuing economic growth and low inflation." He also said the county had been successful in "carefully controlling costs . . . while expanding government services to keep pace with population growth."
The county's population has increased by 29 percent between 1980 and 1985 and now numbers 151,754 residents, White said. He said it is expected to grow by 6,000 residents next year. The additional residents have meant increased local income tax revenues for the county.
At the same time, the county has received more property tax revenue because the value of real estate has increased on the average of 6 percent a year for six years, White said.
County officials said about 75 percent of the additional money generated under Nichols' proposal would go to the school system to hire new teachers and improve programs. About 12 percent of the increase would be used for salary raises for county employes. The remaining money would finance modest increases in other county services, such as public safety and fire and parks and recreation.
County Council Chairman Verdon Gray said the Nichols proposal is likely to stay intact because, although the council can delete items from the budget, it can add money only for education.
Council Vice Chairman James Clark said he supports Nichols' proposed reduction but added that the property tax rate may drop slightly less after salary increases for the county's teachers are included. The school system and teachers' union are negotiating a contract and a settlement is expected soon, he said.
Gray said he is less than enthusiastic about the property tax reduction.
"In some ways it seems he Nichols is trying to out-Reagan Reagan," said Gray, who favors a smaller property tax reduction. Gray said some social service programs have not received enough money to keep up with the demand for services and may suffer more with proposed federal budget cuts.
The county's Office of Human Rights, which investigates employment and discrimination complaints, will lose a $48,000 federal grant next year, county officials said.
Clark also said the tax reduction will not come as a surprise to county residents.
The council will vote on the budget on May 22.