DEPARTMENT OF LEGISLATIVE SERVICES 2023
Property Tax Set-offs
The Use of Local Property Tax Differentials
And Tax Rebates in Maryland
Fiscal 2023
Property Tax Set-offs:
The Use of Local Property Tax Differentials
And Tax Rebates in Maryland
Fiscal 2023
Department of Legislative Services
Office of Policy Analysis
Annapolis, Maryland
November 2023
ii
Primary Staff for This Report
Michael Sousane
Davin Brownell
Other Staff Who Contributed to This Report
Hiram Burch
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iii
DEPARTMENT OF LEGISLATIVE SERVICES
OFFICE OF POLICY ANALYSIS
MARYLAND GENERAL ASSEMBLY
Victoria L. Gruber
Executive Director
Ryan Bishop
Executive Director
November 2023
The Honorable Bill Ferguson, President of the Senate
The Honorable Adrienne A. Jones, Speaker of the House of Delegates
Members of the General Assembly
Dear President Ferguson, Speaker Jones, and Members:
At the local level, counties and municipalities share in the delivery of public services. To
cover the costs of these services, residents of municipalities pay property taxes to both the county
and municipal government. To compensate municipalities for services provided in lieu of similar
county services, many counties in Maryland have established a tax set-off system by providing
either a tax differential or tax rebate to the municipality. A tax differential is a lower county
property tax rate within the municipality. A tax rebate is a direct county payment to the
municipality; however, the county property tax rate within the municipality remains the same.
Tax set-off systems continue to be of interest to State and local government officials. The
Department of Legislative Services conducts an annual review of local tax set-off systems, and
this report summarizes the tax set-off systems for fiscal 2023. The report also provides an overview
of the current law relating to tax set-offs. This report was prepared by Michael Sousane of the
Office of Policy Analysis and reviewed by Hiram Burch. Davin Brownell prepared the manuscript.
We trust that the study will be useful to you and to other persons interested in matters
relating to tax set-off systems.
Sincerely,
Victoria L. Gruber Ryan Bishop
Executive Director Director
VLG:RB/HLB/db
iv
v
Contents
Letter of Transmittal .............................................................................................................
iii
Introduction ...........................................................................................................................
1
Background ...........................................................................................................................
1
Scope .....................................................................................................................................
2
Explanation of Exhibits and Appendix .................................................................................
3
Summary of Findings ............................................................................................................
3
Tax Differentials/Tax Rebates by County.............................................................................
8
Allegany County .......................................................................................................
8
Anne Arundel County ...............................................................................................
8
Baltimore County ......................................................................................................
9
Calvert County ..........................................................................................................
9
Caroline County ........................................................................................................
9
Carroll County ...........................................................................................................
10
Cecil County .............................................................................................................
10
Charles County ..........................................................................................................
11
Dorchester County ....................................................................................................
11
Frederick County .......................................................................................................
12
Garrett County ...........................................................................................................
12
Harford County .........................................................................................................
13
Howard County .........................................................................................................
13
Kent County ..............................................................................................................
13
Montgomery County .................................................................................................
14
vi
Prince George’s County ............................................................................................
14
Queen Anne’s County ...............................................................................................
16
St. Mary’s County .....................................................................................................
16
Somerset County .......................................................................................................
17
Talbot County ...........................................................................................................
17
Washington County ...................................................................................................
17
Wicomico County .....................................................................................................
18
Worcester County......................................................................................................
18
Appendix 1. Tax Differentials and Tax Rebates – Per Capita Amounts .................
19
1
Property Tax Set-offs:
The Use of Local Property Tax Differentials
And Tax Rebates in Maryland
Fiscal 2023
Introduction
Property tax set-offs are meant to compensate for double taxation of municipal taxpayers
occurring when both municipal and county property taxes are levied to fund similar services.
Therefore, counties compensate municipal taxpayers with property tax set-offs through a tax rate
differential or through a tax rebate. A tax rate differential results in a lower county property tax
rate within the boundaries of a municipality, whereas a tax rebate is a direct payment to a
municipality for providing the services or programs.
Background
Section 6-305 of the Tax-Property Article of the Annotated Code of Maryland mandates
that Allegany, Anne Arundel, Baltimore, Garrett, Harford, Howard, Montgomery, and
Prince George’s counties meet annually with the governing bodies of municipalities to discuss the
property tax rate to be set for assessments of property in the municipality. If it is demonstrated that
a municipality performs services or programs in lieu of similar county services and programs, the
governing body of the county must impose the county property tax on assessments of property in
the municipality at a rate that is less than the general county property tax rate. Section 6-305.1
requires Frederick County to meet annually with the governing bodies of municipalities to discuss
the property tax rate to be set for assessments of property in the municipality. If it can be demonstrated
that a municipality performs services or programs in lieu of similar county services and programs,
Frederick County must grant a tax set-off to the municipality in accordance with a formula agreed
to by the county and the municipality. If Frederick County and a municipality fail to reach an
agreement concerning the formula by which a tax set-off is to be calculated, Frederick County
must grant a tax set-off using the formula for the preceding taxable year.
Section 6-306 governs the procedure for the setting of a tax differential in the other
counties. The governing bodies of the counties are required to meet annually with governing bodies
of municipalities to discuss the property tax rate to be set for assessments of property in the
municipality. If it is demonstrated that the municipality performs services or programs in lieu of
similar county services, the county may establish a county property tax rate for property in the
municipality that is lower than the general county property tax rate.
2 Department of Legislative Services
Alternatively, both of the above sections provide the counties with the option of making a
payment to the municipality to aid the municipality in funding municipal services or programs that
are similar to county services or programs. This is commonly known as a tax rebate.
Subsections (d) and (e) of Sections 6-305 and 6-306 of the Tax-Property Article define the
procedures for determining the county property tax rate within a municipality. The provisions
follow:
(d) Setting county rate for municipality. In determining the county property tax rate to be set
for assessments of property in a municipality, the governing body of the county shall
consider:
(1) the services and programs that are performed by the municipality instead of similar
county services and programs; and
(2) the extent that the similar services and programs are funded by property tax
revenues.
(e) Rate need not be uniform. The county property tax rate for assessments of property located
in a municipality is not required to be:
(1) the same as the rate for property located in other municipalities in the county; or
(2) the same as the rate set in a prior year.
A county and one or more municipalities may enter into an agreement setting different
terms or timing for negotiations, calculations, or approval of a tax set-off than are set out under
Sections 6-305 and 6-306.
Scope
This report identifies the real property tax differentials and tax rebates made by the
governing bodies of the counties during fiscal 2023. Information was obtained from a survey of
the counties and the State Department of Assessments and Taxation (SDAT). Specifically,
assessable base information and tax rate differentials were obtained by using data from SDAT.
The tax rate differentials are calculated per $100 of assessed property value.
The following payments are excluded from amounts reported as tax rebates:
• mandatory State pass-through from counties to municipalities, such as supplemental police
aid and distributions from the State Fire, Rescue, and Ambulance Fund;
Property Tax Set-offs 3
• county sales and services taxes, license fees, and alcoholic beverage dispensary profits
required by State law to be shared with municipalities; and
• funds to which a municipality has a claim, such as Program Open Space.
Explanation of Exhibits and Appendix
• Exhibit 1 summarizes the findings of the tax set-off study for fiscal 2023.
• Exhibit 2 compares tax set-offs authorized in fiscal 2023 to those in fiscal 2022.
• Exhibit 3 compares a county’s tax set-off amount in fiscal 2023 with the amount provided
in fiscal 2018.
• Appendix 1 provides a listing of the tax differential and rebate amounts for each
municipality in fiscal 2023 on a per capita basis.
Summary of Findings
Property tax-set offs for municipalities were granted in 18 counties in fiscal 2023. Of the
5 remaining counties, Baltimore and Howard counties have no municipalities, while Kent,
Wicomico, and Worcester counties chose not to establish tax set-offs. In fiscal 2023, tax
differentials and rebates totaled $128.3 million, a 9.8% increase compared to the prior year.
Property tax set-off amounts were higher in 17 counties and lower in 1 county. Local funding for
tax differentials and rebates in fiscal 2023 ranged from $70,929 in St. Mary’s County to
$35.1 million in Prince George’s County. On a per capita basis, local funding ranged from less
than $1 in St. Mary’s County to $100 in Talbot County with the statewide average at $29,
excluding those counties with no municipalities.
Seven counties (Allegany, Anne Arundel, Calvert, Caroline, Charles, Talbot, and
Washington) provided tax rate differentials totaling $43.1 million for the municipalities in their
jurisdictions. Five counties (Carroll, Cecil, Montgomery, St. Mary’s, and Somerset) returned to
the municipalities rebates totaling $21.7 million. Six counties (Dorchester, Frederick, Garrett,
Harford, Prince George’s, and Queen Anne’s) provided both tax differentials and rebates to their
municipalities totaling $63.5 million.
Prince George’s County provided both tax rebates and tax rate differentials to all of its
municipalities, totaling $35.1 million, as did Harford County, totaling $10.2 million.
Frederick County provided tax rate differentials to Frederick and Myersville totaling $10.7 million
and provided 10 other municipalities with $5.2 million in tax rebates. Dorchester County provided
4 Department of Legislative Services
tax differentials to Cambridge and Hurlock totaling $752,022 and provided tax rebates to seven
other municipalities totaling $6,050. Garrett County had a tax rate differential totaling $72,326 for
Mountain Lake Park and provided $297,000 in rebates to seven other municipalities.
Queen Anne’s County provided tax rate differentials to Centreville and Millington totaling
$808,708 and provided six other municipalities with $282,101 in tax rebates.
The City of Annapolis (Anne Arundel County) received the largest tax set-off amount in
fiscal 2023. The county real property tax rate within the city was reduced by $0.374 per $100 of
assessed value resulting in a property tax revenue offset of $25.6 million in fiscal 2023, or $629 per
city resident. The City of Bowie (Prince George’s County) received the next largest tax set-off
amount with a property tax differential amount of $11.2 million. The City of Frederick
(Frederick County) received a property tax differential amount of $10.5 million, the third highest
amount.
For a majority of municipalities in Maryland, the per capita tax differential or rebate
amount is under $75 per municipal resident. In 23 municipalities, the county government did not
grant either a tax differential or tax rebate. In 13 municipalities, the tax differential or rebate
amount exceeded $200 per municipal resident.
Property Tax Set-offs 5
Exhibit 1
Tax Differentials and Tax Rebates
Fiscal 2023
County
Tax Rebate
Total
Allegany
$0
$2,068,856
Anne Arundel
0
25,583,845
Baltimore City
n/a
n/a
Baltimore
n/a
n/a
Calvert
0
3,944,780
Caroline
0
514,431
Carroll
2,687,236
2,687,236
Cecil
874,203
874,203
Charles
0
2,217,677
Dorchester
6,050
758,072
Frederick
5,246,806
15,959,815
Garrett
297,000
369,326
Harford
3,699,456
10,157,108
Howard
n/a
n/a
Kent
0
0
Montgomery
17,269,692
17,269,692
Prince George’s
651,147
35,126,165
Queen Anne’s
282,101
1,090,809
St. Mary’s
70,929
70,929
Somerset
844,976
844,976
Talbot
0
3,803,338
Washington
0
4,989,071
Wicomico
0
0
Worcester
0
0
Total
$31,929,596
$128,330,329
n/a: Indicates the jurisdiction has no municipalities.
Source: Department of Legislative Services
6 Department of Legislative Services
Exhibit 2
Changes in Tax Differentials and Tax Rebates
Fiscal 2022 and 2023
County
2022
2023
Difference
% Difference
Allegany
$1,801,486
$2,068,856
$267,370
14.8%
Anne Arundel
25,016,722
25,583,845
567,123
2.3%
Baltimore City
n/a
n/a
n/a
n/a
Baltimore
n/a
n/a
n/a
n/a
Calvert
3,765,626
3,944,780
179,154
4.8%
Caroline
488,746
514,431
25,685
5.3%
Carroll
2,811,517
2,687,236
-124,281
-4.4%
Cecil
816,051
874,203
58,152
7.1%
Charles
2,096,423
2,217,677
121,254
5.8%
Dorchester
682,617
758,072
75,455
11.1%
Frederick
15,029,151
15,959,815
930,664
6.2%
Garrett
368,227
369,326
1,099
0.3%
Harford
10,046,122
10,157,108
110,986
1.1%
Howard
n/a
n/a
n/a
n/a
Kent
70,000
0
-70,000
-100.0%
Montgomery
8,993,070
17,269,692
8,276,622
92.0%
Prince George’s
34,925,171
35,126,165
200,994
0.6%
Queen Anne’s
1,056,643
1,090,809
34,166
3.2%
St. Mary’s
44,461
70,929
26,468
59.5%
Somerset
393,200
844,976
451,776
114.9%
Talbot
3,702,004
3,803,338
101,334
2.7%
Washington
4,767,444
4,989,071
221,627
4.6%
Wicomico
0
0
0
0.0%
Worcester
0
0
0
0.0%
Total
$116,874,683
$128,330,329
$11,455,648
9.8%
n/a: Indicates that the jurisdiction has no municipalities.
Source: Department of Legislative Services
Property Tax Set-offs 7
Exhibit 3
Changes in Tax Differentials and Tax Rebates
Over a Five-year Period
County
FY 2018
FY 2023
Difference
% Difference
Allegany
$1,867,037
$2,068,856
$201,819
10.8%
Anne Arundel
21,643,147
25,583,845
3,940,698
18.2%
Baltimore City
n/a
n/a
n/a
n/a
Baltimore
n/a
n/a
n/a
n/a
Calvert
3,392,275
3,944,780
552,505
16.3%
Caroline
545,484
514,431
-31,053
-5.7%
Carroll
2,182,194
2,687,236
505,042
23.1%
Cecil
729,049
874,203
145,154
19.9%
Charles
1,648,150
2,217,677
569,527
34.6%
Dorchester
408,722
758,072
349,350
85.5%
Frederick
13,591,738
15,959,815
2,368,077
17.4%
Garrett
363,105
369,326
6,221
1.7%
Harford
9,629,452
10,157,108
527,656
5.5%
Howard
n/a
n/a
n/a
n/a
Kent
0
0
0
0.0%
Montgomery
8,168,433
17,269,692
9,101,259
111.4%
Prince George’s
27,114,492
35,126,165
8,011,673
29.5%
Queen Anne’s
757,052
1,090,809
333,757
44.1%
St. Mary’s
44,916
70,929
26,013
57.9%
Somerset
393,200
844,976
451,776
114.9%
Talbot
3,366,997
3,803,338
436,341
13.0%
Washington
4,263,530
4,989,071
725,541
17.0%
Wicomico
0
0
0
0.0%
Worcester
0
0
0
0.0%
Total
$100,108,973
$128,330,329
$28,221,356
28.2%
n/a: Indicates that the jurisdiction has no municipalities.
Source: Department of Legislative Services
8 Department of Legislative Services
Tax Differentials/Tax Rebates by County
Allegany County
During fiscal 2023, Allegany County provided a tax rate differential to all of its
seven municipalities for performing governmental services in areas including planning and zoning,
police protection, public works, highway construction and maintenance, solid waste disposal, and
emergency medical services. The rates are determined by calculating the net property tax support
of each area of service and dividing it by the amount of revenue generated by $1 of property tax
levy. The estimated value of the tax differentials in fiscal 2023 is approximately $2.1 million.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Barton
$0.0797
$9,756
Cumberland
0.1589
1,466,330
Frostburg
0.1276
473,703
Lonaconing
0.1118
32,752
Luke
0.1141
32,773
Midland
0.0797
9,950
Westernport
0.0797
43,592
Total
$2,068,856
Anne Arundel County
Anne Arundel County set a real property tax rate differential of $0.374 for the City of
Annapolis in fiscal 2023 for providing a variety of services that the county performs outside the
city limits, including police protection, fire, public works, planning and zoning, and parks and
recreation. The estimated value of the tax differential in fiscal 2023 is $25.6 million. In calculating
the tax rate differential, several steps were involved. First, county spending was allocated into
countywide (e.g., education) and noncity (e.g., police) categories. Second, all county revenues,
except property taxes, are allocated to offset the cost of either countywide or noncity services.
Third, costs that are offset are used to calculate countywide and noncity property tax rates. Finally,
this noncity property tax rate serves as the Annapolis tax rate differential. Highland Beach, the
other incorporated municipality in Anne Arundel County, received a real property tax rate
differential of $0.03, which equals $10,259 in reduced county revenues. The tax differential takes
into consideration that the municipality provides public works and planning and zoning services.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Annapolis
$0.3740
$25,573,586
Highland Beach
0.0300
10,259
Total
$25,583,845
Property Tax Set-offs 9
Baltimore County
There are no incorporated municipalities solely within Baltimore County; however, a small
part of Hampstead is located in the county.
Calvert County
Calvert County provided a tax rate differential for its two municipalities for public safety,
public works, parks and recreation, and economic development. In fiscal 2023, these tax
differentials totaled approximately $3.9 million. The county periodically assesses the
reasonableness of the differential by calculating the net cost to the municipalities of providing
duplicative public services and what the net cost to the county would be to provide the same
services for the municipality. These costs are used with property assessment data to calculate a
range within which the tax rate differential should fall. If the differential falls within the range, the
county advises that the differentials remain unchanged.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Chesapeake Beach
$0.3360
$3,001,396
North Beach
0.3360
943,384
Total
$3,944,780
Caroline County
Caroline County provides tax rate differentials to municipalities with police protection.
Historically, the differential rate is based on a formula of county police coverage. However, county
commissioners have held differentials constant over the last three years. In fiscal 2023,
Caroline County provided tax differentials totaling approximately $0.5 million.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Denton
$0.06
$247,623
Federalsburg
0.08
129,502
Goldsboro
0.00
0
Greensboro
0.06
66,455
Henderson
0.00
0
Hillsboro
0.00
0
Marydel
0.00
0
Preston
0.01
7,082
Ridgely
0.05
63,769
Templeville
0.00
0
Total
$514,431
10 Department of Legislative Services
Carroll County
Carroll County provided its eight municipalities with tax rebates totaling $2.7 million in
fiscal 2023 in accordance with a longstanding agreement between the county and the
municipalities. Funding is allocated to each municipality based in part on assessable base,
inflation, and population. The tax rebates were distributed as follows:
Municipality
Rebate Amount
Hampstead
$315,129
Manchester
304,139
Mount Airy
179,488
New Windsor
69,285
Sykesville
214,740
Taneytown
448,010
Union Bridge
63,894
Westminster
1,092,551
Total
$2,687,236
Cecil County
Cecil County returned to its eight municipalities a general rebate equivalent to $0.028 per
$100 of assessed property values for police protection and street lighting. In addition, the county
made rebate payments to its municipalities totaling $51,652 to offset the cost of refuse and garbage
collection. The trash rebate is based on the average tons per capita of refuse deposited in the county
landfill ($3.00 per ton × 0.75 tons per capita × population). The total rebate amount that
municipalities in Cecil County received in fiscal 2023 was $874,203. The amounts were distributed
as follows:
Municipality
General Rebate
Trash Rebate
Total Rebate
Amount
Cecilton
$14,897
$1,067
$15,964
Charlestown
54,993
2,293
57,286
Chesapeake City
26,047
1,771
27,818
Elkton
373,707
26,759
400,466
North East
135,719
6,149
141,868
Perryville
139,244
8,262
147,506
Port Deposit
18,355
1,521
19,876
Rising Sun
59,589
3,830
63,419
Total
$822,551
$51,652
$874,203
Property Tax Set-offs 11
Charles County
Charles County provided a real property tax rate differential to La Plata and Indian Head
in fiscal 2023 totaling $2.2 million for performing government services in the areas of planning
and growth management, police services, parks, and public works. The rate is determined by
calculating the expenditures funded by property taxes for parallel services provided by the
municipality and dividing this amount by the municipality’s assessable base. The Town of
Port Tobacco received neither a tax differential nor a tax rebate as the town did not perform any
services in lieu of those performed by the county.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Indian Head
$0.0390
$127,851
La Plata
0.1420
2,089,826
Total
$2,217,677
Dorchester County
In fiscal 2023, two of Dorchester County’s nine municipalities, Cambridge and Hurlock,
received tax rate differentials totaling $0.8 million, and all other municipalities received tax rebates
totaling $6,050. The tax differentials are provided to compensate the municipalities for providing
duplicative services, including police and planning and zoning. The tax rate differentials were
calculated by multiplying the net cost to the county of providing the services by the percentage of
those costs funded by real property taxes and the percentage of the county’s assessable property
base located in each municipality. The tax rebate levels are based on historical funding levels
established by the county government.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Brookview
$0.0000
$0
$450
$450
Cambridge
0.0733
645,024
0
645,024
Church Creek
0.0000
0
425
425
East New Market
0.0000
0
1,350
1,350
Eldorado
0.0000
0
425
425
Galestown
0.0000
0
700
700
Hurlock
0.0821
106,998
0
106,998
Secretary
0.0000
0
1,350
1,350
Vienna
0.0000
0
1,350
1,350
Total
$752,022
$6,050
$758,072
12 Department of Legislative Services
Frederick County
Frederick County provided a real property tax rate differential to Frederick and Myersville
totaling $10.7 million in fiscal 2023. Frederick County provided tax rebates totaling $5.2 million
in fiscal 2023 to the other 10 municipalities for highways, police protection, planning and zoning,
and parks and recreation. The tax rebates were determined by calculating a certain factor (called a
CAP factor), which is based on the municipalities’ total taxable income, assessable base, and
population compared to the county’s total taxable income, assessable base, and population. The
net expenditures for each of the duplicative services were then calculated. For police protection
and planning and zoning, the net expenditures for duplicative services were used to calculate the
cost of these services per capita for the municipality; however, for highways, cost per mile was
used, and for parks and recreation, cost per acre of parkland was used. The county then compared
the per capita (or per mile or acre) calculation to the net cost of the service multiplied by the
CAP factor. The lesser of the two calculations was the total amount to be distributed among the
municipalities, based on each municipality’s population. The tax rate differentials are calculated
in a similar manner. The total tax set-off amounts in fiscal 2023 were as follows:
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Brunswick
$0.0000
$0
$1,215,166
$1,215,166
Burkittsville
0.0000
0
26,169
26,169
Emmitsburg
0.0000
0
428,331
428,331
Frederick
0.1113
10,476,212
0
10,476,212
Middletown
0.0000
0
671,867
671,867
Mount Airy
0.0000
0
628,761
628,761
Myersville
0.1177
236,797
0
236,797
New Market
0.0000
0
126,507
126,507
Rosemont
0.0000
0
20,072
20,072
Thurmont
0.0000
0
998,390
998,390
Walkersville
0.0000
0
1,002,940
1,002,940
Woodsboro
0.0000
0
128,603
128,603
Total
$10,713,009
$5,246,806
$15,959,815
Garrett County
In fiscal 2023, Garrett County provided a tax rate differential to Mountain Lake Park. The tax
differential was granted for highway and street expenditures by the municipality. The real property tax
rate differential for Mountain Lake Park is equal to the municipal property tax rate multiplied by the
assessable base of each Garrett County government entity located within Mountain Lake Park that the
county has authority over and/or for which the county provides funding. The total value of the tax
differentials for Mountain Lake Park was $72,326. Garrett County also provided tax rebates to all its
other municipalities. Oakland received a rebate of $147,000 for road paving projects and police
Property Tax Set-offs 13
protection, and the other municipalities received $25,000 for their expenditures on town roads. The
rebates for all the municipalities totaled $297,000.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Accident
$0.0000
$0
$25,000
$25,000
Deer Park
0.0000
0
25,000
25,000
Friendsville
0.0000
0
25,000
25,000
Grantsville
0.0000
0
25,000
25,000
Kitzmiller
0.0000
0
25,000
25,000
Loch Lynn Heights
0.0000
0
25,000
25,000
Mountain Lake Park
0.0640
72,326
0
72,326
Oakland
0.0000
0
147,000
147,000
Total
$72,326
$297,000
$369,326
Harford County
Harford County provided a tax differential for its three municipalities for services
performed in the area of road maintenance. The estimated value of the Harford County tax rate
differentials totaled $6.5 million in fiscal 2023. The county also provided approximately
$3.7 million in tax rebates to its municipalities for police services. The tax rebates are determined
by calculating the cost of operating the Criminal Patrol Division of the County Sheriff’s
Department funded by county property taxes and then multiplying that figure by the ratio of each
municipality’s assessable tax base to the countywide assessable tax base.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Aberdeen
$0.1366
$2,137,023
$1,268,924
$3,405,947
Bel Air
0.1366
2,030,622
1,216,111
3,246,733
Havre de Grace
0.1366
2,290,007
1,214,421
3,504,428
Total
$6,457,652
$3,699,456
$10,157,108
Howard County
There are no incorporated municipalities in Howard County.
Kent County
Kent County did not provide tax set-offs to its municipalities in fiscal 2023.
14 Department of Legislative Services
Montgomery County
Montgomery County provided tax rebates totaling $17.3 million to 17 municipalities and
3 special taxing districts in fiscal 2023. Barnesville and Chevy Chase, Section 5, were the only
municipalities that did not receive a tax rebate in fiscal 2023. The tax rebates are based on the
county council’s appropriation.
Municipality
Rebate Amount
Barnesville
$0
Brookeville
15,186
Chevy Chase, Sec. III
55,648
Chevy Chase, Sec. V
0
Chevy Chase View
77,527
Chevy Chase Village
275,985
Town of Chevy Chase
237,650
Drummond*
8,665
Friendship Heights*
108,511
Gaithersburg
3,498,978
Garrett Park
91,049
Glen Echo
38,992
Kensington
266,908
Laytonsville
44,373
Martin's Additions
50,393
North Chevy Chase
47,428
Oakmont*
6,157
Poolesville
529,829
Rockville
6,593,160
Somerset
105,600
Takoma Park
5,133,285
Washington Grove
84,368
Total
$17,269,692
* Denotes a special taxing district.
Prince George’s County
In fiscal 2023, Prince George’s County provided its 27 municipalities with tax differentials
valued at an estimated $34.5 million and tax rebates totaling $0.7 million. County law requires the
cost for each service for each municipality identified in the prior year county budget to be assigned
a tax rate equivalency value after adjustments are made to offset revenue directly allocated to a
specific service. The aggregate municipal requests for “in lieu of” service credit, as certified by
the county, are translated into a dollar value. This dollar value is calculated by totaling the products
Property Tax Set-offs 15
of the tax rate equivalent cost of the service multiplied by each municipality’s assessable base.
Each of these net service values is then reduced to reflect the portion of each county service paid
for by the property tax levy. The sum of the tax rate values of the duplicative services constitutes
the calculated tax rate differential for each municipality. The county uses a three-year rolling
average in applying the calculated tax differentials to provide stability to municipal
residents’ county tax rates in the event of rate changes due to county services reorganization,
economic fluctuations, or other factors. The county also provides tax rebates for solid waste
collection and code enforcement.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Berwyn Heights
$0.1380
$483,586
$8,231
$491,817
Bladensburg
0.1370
720,615
22,486
743,101
Bowie
0.1460
11,027,611
149,877
11,177,488
Brentwood
0.0820
259,730
8,379
268,109
Capitol Heights
0.1320
445,561
10,723
456,284
Cheverly
0.1330
916,530
18,839
935,369
College Park
0.0360
1,191,292
83,290
1,274,582
Colmar Manor
0.1230
137,142
3,483
140,625
Cottage City
0.0910
106,607
3,446
110,053
District Heights
0.1370
579,980
20,607
600,587
Eagle Harbor
0.0020
207
153
360
Edmonston
0.0990
181,268
3,498
184,766
Fairmount Heights
0.0680
87,921
3,908
91,829
Forest Heights
0.1100
229,907
7,997
237,904
Glenarden
0.1100
671,853
16,371
688,224
Greenbelt
0.1440
3,536,764
64,151
3,600,915
Hyattsville
0.1490
3,504,889
48,082
3,552,971
Landover Hills
0.0880
156,611
5,644
162,255
Laurel
0.1730
6,181,234
68,781
6,250,015
Morningside
0.0840
92,590
5,518
98,108
Mount Rainier
0.1380
760,219
22,179
782,398
New Carrollton
0.1330
1,191,312
33,467
1,224,779
North Brentwood
0.0040
2,480
1,428
3,908
Riverdale Park
0.1150
1,001,419
17,335
1,018,754
Seat Pleasant
0.1240
430,395
14,943
445,338
University Park
0.1340
516,221
6,254
522,475
Upper Marlboro
0.0570
61,074
2,077
63,151
Total
$34,475,018
$651,147
$35,126,165
16 Department of Legislative Services
Queen Anne’s County
In fiscal 2023, two of Queen Anne’s County’s eight municipalities, Centreville and
Millington, received tax rate differentials totaling $808,708. Six other municipalities received tax
rebates totaling $282,101. The tax differentials are provided to compensate the municipalities for
providing duplicative services including police, planning and zoning, and roads. Both the tax rate
differentials and the tax rebates were calculated by determining a tax rate for each government
service or function in the county and then determining, in conjunction with the municipality, what
level of service they provide in lieu of county services. That level of service equates to a county
rate which, along with the assessable base, is then used to calculate the amount of a tax differential.
For the tax rebates, the tax rate, based on the municipal assessable base, represents the amount of
rebate for that municipality.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Rebate
Amount
Total
Barclay
$0.0000
$0
$17,725
$17,725
Centreville
0.1300
807,601
0
807,601
Church Hill
0.0000
0
52,263
52,263
Millington
0.0850
1,107
0
1,107
Queen Anne
0.0000
0
4,761
4,761
Queenstown
0.0000
0
164,922
164,922
Sudlersville
0.0000
0
41,430
41,430
Templeville
0.0000
0
1,000
1,000
Total
$808,708
$282,101
$1,090,809
St. Mary’s County
St. Mary’s County provided a tax rebate in the amount of $70,929 to the Town of
Leonardtown in fiscal 2023 to offset taxes for duplicative services such as planning and zoning,
road maintenance, and public works. The rebate is based on the total assessed value of
county-owned property within the municipality’s corporate limits multiplied by an equitable tax
rate on those properties.
Municipality
Rebate Amount
Leonardtown
$70,929
Property Tax Set-offs 17
Somerset County
Somerset County provided tax rebates in fiscal 2023 to Crisfield and Princess Anne in the
amount of $422,488 to help fund the cost of several paramedics used by the local ambulance
companies. In Princess Anne, payments are made directly to the Princess Anne Fire Department.
Municipality
Rebate Amount
Crisfield
$422,488
Princess Anne
422,488
Total
$844,976
Talbot County
In fiscal 2023, Talbot County provided tax rate differentials totaling $3.8 million to its
five municipalities for performing governmental services in the areas of planning and zoning,
police and fire protection, building code enforcement, parks and recreation, tourism and economic
development, highways and streets, and public works. The county established real property tax
rate differentials based on a “county cost for parallel services” formula until fiscal 2000, when, in
addition to the formula, additional annual adjustments were made. In recent years, the adjusted tax
differential has been more than the tax differential calculated under the parallel services formula.
The county also provides a tax rate differential for utility property located in the municipalities.
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Easton
$0.1330
$2,952,513
Oxford
0.1180
357,016
Queen Anne
0.0601
4,274
St. Michaels
0.1270
411,448
Trappe
0.0980
78,087
Total
$3,803,338
Washington County
For fiscal 2023, Washington County provided tax differentials to its nine municipalities for
providing services such as police protection, public works, planning and zoning, parks, and road
overlay. Prior to fiscal 2011, the county provided tax rebates to its municipalities for providing
these services. The tax differential is determined by calculating the portion of the county property
tax rate that is used to fund services throughout the entire county, including in municipalities, and
the portion of the county property tax rate that is used to fund services only in areas outside of
municipalities. The latter tax rate is the amount of the tax differential for the municipalities. The
fiscal 2023 tax differentials totaled approximately $5.0 million.
18 Department of Legislative Services
Municipality
Real Property
Tax Rate Differential
Differential
Amount
Boonsboro
$0.125
$442,073
Clear Spring
0.125
28,182
Funkstown
0.125
76,114
Hagerstown
0.125
3,702,512
Hancock
0.125
125,303
Keedysville
0.125
132,255
Sharpsburg
0.125
58,011
Smithsburg
0.125
279,593
Williamsport
0.125
145,028
Total
$4,989,071
Wicomico County
Wicomico County did not provide tax set-offs to its municipalities in fiscal 2023.
Worcester County
Worcester County did not provide tax set-offs to its municipalities in fiscal 2023.
19
Appendix 1. Tax Differentials and
Tax Rebates – Per Capita Amounts
Fiscal 2023
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Allegany
Barton
458
$9,756
$0
$9,756
$21
Cumberland
18,769
1,466,330
0
1,466,330
78
Frostburg
6,958
473,703
0
473,703
68
Lonaconing
987
32,752
0
32,752
33
Luke
84
32,773
0
32,773
390
Midland
479
9,950
0
9,950
21
Westernport
1,779
43,592
0
43,592
25
Anne Arundel
Annapolis
40,648
$25,573,586
$0
$25,573,586
$629
Highland Beach
107
10,259
0
10,259
96
Calvert
Chesapeake Beach
6,479
$3,001,396
$0
$3,001,396
$463
North Beach
2,176
943,384
0
943,384
434
Caroline
Denton
4,924
$247,623
$0
$247,623
$50
Federalsburg
2,806
129,502
0
129,502
46
Goldsboro
214
0
0
0
0
Greensboro
1,913
66,455
0
66,455
35
Henderson
158
0
0
0
0
Hillsboro
126
0
0
0
0
Marydel
176
0
0
0
0
Preston
677
7,082
0
7,082
10
Ridgely
1,605
63,769
0
63,769
40
Templeville*
32
0
0
0
0
20
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Carroll
Hampstead*
6,342
$0
$315,129
$315,129
$50
Manchester
5,484
0
304,139
304,139
55
Mount Airy*
6,227
0
179,488
179,488
29
New Windsor
1,459
0
69,285
69,285
47
Sykesville
4,371
0
214,740
214,740
49
Taneytown
7,340
0
448,010
448,010
61
Union Bridge
940
0
63,894
63,894
68
Westminster
20,393
0
1,092,551
1,092,551
54
Cecil
Cecilton
679
$0
$15,964
$15,964
$24
Charlestown
1,513
0
57,286
57,286
38
Chesapeake City
740
0
27,818
27,818
38
Elkton
15,913
0
400,466
400,466
25
North East
4,132
0
141,868
141,868
34
Perryville
4,445
0
147,506
147,506
33
Port Deposit
621
0
19,876
19,876
32
Rising Sun
2,761
0
63,419
63,419
23
Charles
Indian Head
4,025
$127,851
$0
$127,851
$32
La Plata
10,676
2,089,826
0
2,089,826
196
Port Tobacco
21
0
0
0
0
Dorchester
Brookview
46
$0
$450
$450
$10
Cambridge
13,129
645,024
0
645,024
49
Church Creek
102
0
425
425
4
East New Market
393
0
1,350
1,350
3
Eldorado
46
0
425
425
9
Galestown
113
0
700
700
6
Hurlock
2,077
106,998
0
106,998
52
Secretary
471
0
1,350
1,350
3
Vienna
272
0
1,350
1,350
5
Frederick
Brunswick
8,211
$0
$1,215,166
$1,215,166
$148
Burkittsville
150
0
26,169
26,169
174
21
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Emmitsburg
2,921
0
428,331
428,331
147
Frederick City
82,175
10,476,212
0
10,476,212
127
Middletown
5,239
0
671,867
671,867
128
Mount Airy*
3,592
0
628,761
628,761
175
Myersville
1,854
236,797
0
236,797
128
New Market
1,614
0
126,507
126,507
78
Rosemont
289
0
20,072
20,072
69
Thurmont
6,588
0
998,390
998,390
152
Walkersville
6,521
0
1,002,940
1,002,940
154
Woodsboro
1,156
0
128,603
128,603
111
Garrett
Accident
335
$0
$25,000
$25,000
$75
Deer Park
303
0
25,000
25,000
83
Friendsville
432
0
25,000
25,000
58
Grantsville
966
0
25,000
25,000
26
Kitzmiller
293
0
25,000
25,000
85
Loch Lynn Heights
486
0
25,000
25,000
51
Mountain Lake Park
2,124
72,326
0
72,326
34
Oakland
1,828
0
147,000
147,000
80
Harford
Aberdeen
16,859
$2,137,023
$1,268,924
$3,405,947
$202
Bel Air
10,596
2,030,622
1,216,111
3,246,733
306
Havre de Grace
14,996
2,290,007
1,214,421
3,504,428
234
Kent
Betterton
285
$0
$0
$0
$0
Chestertown
5,563
0
0
0
0
Galena
540
0
0
0
0
Millington
527
0
0
0
0
Rock Hall
1,196
0
0
0
0
Montgomery
Barnesville
140
$0
$0
$0
$0
Brookeville
163
0
15,186
15,186
93
Chevy Chase, Sec. 3
788
0
55,648
55,648
71
Chevy Chase, Sec. 5
663
0
0
0
0
Chevy Chase
2,855
0
237,650
237,650
83
22
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Chevy Chase View
991
0
77,527
77,527
78
Chevy Chase Village
2,019
0
275,985
275,985
137
Drummond
-
0
8,665
8,665
0
Friendship Heights
-
0
108,511
108,511
0
Gaithersburg
68,952
0
3,498,978
3,498,978
51
Garrett Park
978
0
91,049
91,049
93
Glen Echo
275
0
38,992
38,992
142
Kensington
2,099
0
266,908
266,908
127
Laytonsville
569
0
44,373
44,373
78
Martin’s Additions
928
0
50,393
50,393
54
North Chevy Chase
676
0
47,428
47,428
70
Oakmont
-
0
6,157
6,157
0
Poolesville
5,688
0
529,829
529,829
93
Rockville
66,924
0
6,593,160
6,593,160
99
Somerset
1,171
0
105,600
105,600
90
Takoma Park
17,390
0
5,133,285
5,133,285
295
Washington Grove
497
0
84,368
84,368
170
Prince George’s
Berwyn Heights
3,270
$483,586
$8,231
$491,817
$150
Bladensburg
9,444
720,615
22,486
743,101
79
Bowie
57,192
11,027,611
149,877
11,177,488
195
Brentwood
3,732
259,730
8,379
268,109
72
Capitol Heights
3,953
445,561
10,723
456,284
115
Cheverly
6,019
916,530
18,839
935,369
155
College Park
34,190
1,191,292
83,290
1,274,582
37
Colmar Manor
1,554
137,142
3,483
140,625
90
Cottage City
1,300
106,607
3,446
110,053
85
District Heights
5,816
579,980
20,607
600,587
103
Eagle Harbor
66
207
153
360
5
Edmonston
1,575
181,268
3,498
184,766
117
Fairmount Heights
1,488
87,921
3,908
91,829
62
Forest Heights
2,609
229,907
7,997
237,904
91
Glenarden
6,268
671,853
16,371
688,224
110
Greenbelt
24,360
3,536,764
64,151
3,600,915
148
Hyattsville
20,675
3,504,889
48,082
3,552,971
172
Landover Hills
1,767
156,611
5,644
162,255
92
Laurel
29,352
6,181,234
68,781
6,250,015
213
Morningside
1,211
92,590
5,518
98,108
81
23
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Mt. Rainier
8,126
760,219
22,179
782,398
96
New Carrollton
13,403
1,191,312
33,467
1,224,779
91
North Brentwood
578
2,480
1,428
3,908
7
Riverdale Park
7,171
1,001,419
17,335
1,018,754
142
Seat Pleasant
4,462
430,395
14,943
445,338
100
University Park
2,386
516,221
6,254
522,475
219
Upper Marlboro
702
61,074
2,077
63,151
90
Queen Anne’s
Barclay
185
$0
$17,725
$17,725
$96
Centreville
4,755
807,601
0
807,601
170
Church Hill
815
0
52,263
52,263
64
Millington*
22
1,107
0
1,107
50
Queen Anne*
128
0
4,761
4,761
37
Queenstown
741
0
164,922
164,922
223
Sudlersville
516
0
41,430
41,430
80
Templeville*
84
0
1,000
1,000
12
St. Mary’s
Leonardtown
4,905
$0
$70,929
$70,929
$14
Somerset
Crisfield
2,446
$0
$422,488
$422,488
$173
Princess Anne
3,472
0
422,488
422,488
122
Talbot
Easton
17,342
$2,952,513
$0
$2,952,513
$170
Oxford
608
357,016
0
357,016
587
Queen Anne*
61
4,274
0
4,274
70
St. Michaels
1,068
411,448
0
411,448
385
Trappe
1,191
78,087
0
78,087
66
Washington
Boonsboro
3,814
$442,073
$0
$442,073
$116
Clear Spring
370
28,182
0
28,182
76
Funkstown
849
76,114
0
76,114
90
Hagerstown
43,701
3,702,512
0
3,702,512
85
Hancock
1,553
125,303
0
125,303
81
Keedysville
1,213
132,255
0
132,255
109
24
Tax
Tax
Total
Per Capita
Jurisdiction
Population
Differential
Rebate
Amount
Amount
Sharpsburg
565
58,011
0
58,011
103
Smithsburg
3,121
279,593
0
279,593
90
Williamsport
2,084
145,028
0
145,028
70
Wicomico
Delmar
4,122
$0
$0
$0
$0
Fruitland
5,843
0
0
0
0
Hebron
1,112
0
0
0
0
Mardela Springs
353
0
0
0
0
Pittsville
1,644
0
0
0
0
Salisbury
33,209
0
0
0
0
Sharptown
700
0
0
0
0
Willards
985
0
0
0
0
Worcester
Berlin
5,259
$0
$0
$0
$0
Ocean City
6,915
0
0
0
0
Pocomoke City
4,402
0
0
0
0
Snow Hill
2,272
0
0
0
0
* Municipality is in two counties.
Source: Department of Legislative Services