OCEAN CITY — While Worcester County’s independent study of the tax differential for Ocean City was released this week, revealing a potential détente in the long-standing issue of duplicated services, it does not appear the late arrival of the study results will have an impact this year.
Late last year, the Ocean City Mayor and Council again submitted its official tax differential request to Worcester officials in advance of the county’s ongoing budget deliberations this spring. Each year, the town of Ocean City seeks tax relief from Worcester County for services duplicated by the two jurisdictions.
Ocean City submitted this year its annual tax differential request to the county along with its independent study that identified roughly $17 million in duplicated services provided by the resort. Worcester County then commissioned its own independent study to determine, the results of which were released this week. While the study is complicated and carefully details each and every area from which duplicated services can be derived, on the surface, it appears to confirm what the resort has been seeking for decades.
The county’s current property tax rate is 77 cents per $100 of assessed value. The county’s independent study released this week appears to suggest based on the level of duplicated services the county property tax rate for Ocean City residents should be more like 74 cents per $100 of assessed value while the rate for property owners in the county at-large should be 82 cents.
With Worcester’s study released this week well into the county’s current budget deliberations for fiscal year 2017, the County Commissioners will likely carefully examine the lengthy document before making any decision, which means nothing will likely change for Ocean City during this budget cycle. Instead, the county appears to be moving forward with its traditional unrestricted grant program in fiscal year 2017 for Ocean City.
For example, Ocean City last year received a $3 million unrestricted grant from the county and that total has been raised to $3.12 million this year. Berlin is set to receive $1.4 million in unrestricted grants from the county in fiscal year 2017, while Snow Hill’s total is a little over $1.3 million and Pocomoke is set to receive $1.19 million.
Ocean City Mayor Rick Meehan discussed the tax differential during a second-reading of the resort’s fiscal year 2017 budget on Monday, ironically less than a day before the county’s study was released on Tuesday. Meehan said the county’s other four municipalities seem to favor the county’s current unrestricted grant program.
“Other municipalities in Worcester County do not support tax differential,” he said. “If you really look at the taxes they pay and the money that goes to Worcester County from some of the other municipalities, they actually get back more in grants then they pay in taxes.”
Meehan said on Monday Ocean City pays the lion’s share of the county’s property tax revenue and the independent study released on Tuesday confirms that.
“We’re at almost 60 percent,” he said. “We’re the ones paying the majority of the taxes. I’ve talked to the other mayors and they don’t favor tax differential because they are afraid they will get back less.”
