Residents Complain to Council about Proposed Hotel Tax, Tax Exemption

More than 15 Aberdeen residents crowded into the City Council meeting Monday to express opposition to a state measure that would establish Harford County hotel tax and give a $600,000 annual tax break to a nonprofit retirement community.

The state bill, introduced last week by Del. Mary-Dulany James, would establish a 5 percent hotel room tax for Harford County, long sought  by Aberdeen Mayor Michael E. Bennett and the council.

But the mayor and the council have expressed opposition to the bill because they believe the independent living portion of the planned retirement community should not be exempt from paying taxes.

Under the bill, a portion of the proceeds from the hotel tax would help Aberdeen fund maintenance and repairs at Ripken Stadium. Another part of the hotel tax proceeds would go toward building a county convention center.

The bill would give the 15-year tax exemption from municipal and county property  taxes to Presbyterian Home of Maryland, the nonprofit developer of the Village of Carsins Run, a continuing-care retirement community to be built on 138 acres near Ripken Stadium.

Some, including Bennett, have said they are not opposed to the assisted living and nursing home components of Carsins Run being deemed tax exempt. But the independent living facilities shouldn’t get that privilege, he and other critics say.

“They’re just like your home or mine,” Bennett said Monday after the meeting. “They pay their fare share like everybody else.”

But Susan Shea, president and CEO of Presbyterian Home, said that’s not a valid comparison because Carsins Run residents in independent living will not own their homes and thus should not pay property taxes.

“When you move into our campus, the resident doesn’t own their house,” Shea said. “It's theirs to use while they’re still active independent people, but the nonprofit owns the house.”

Still, Bennett said he would refuse to create a “protected class of retirees” for people who could afford to live in Carsins Run as others pay taxes while struggling to juggle medicine costs and other basic expenses.

“Why should they pay for another retiree?” Bennett asked.

The Village of Carsins Run is to offer a mix of 21 single-family cottages along with more than 150 apartment units. Those who choose the apartment lifestyle would have access to a wellness center, dining and activity space that includes billiards, card tables and a library. 

The project itself has drawn little opposition, as large development projects often do.

But the tax break is unfair to other businesses, opponents told the council.

Patrick McGrady said his business, Holly Circle Townhouses in Aberdeen, pays about $100,000 a year in property taxes and argued Carsins Run should have to pay taxes too.

"This is an injustice,” McGrady said. “I encourage the council to oppose the tax exemption.

“We don’t get this tax credit. If they cut taxes for everybody, it’s a great deal.”

Chuck Doty, a member of Aberdeen Communities Together who said he spoke on his own behalf, not that of the group, said he wasn’t against growth. But, he said, the community should not get the tax break for assisted living units.

“I’ve lived here for darn near 40 years,” Doty said. “Most retirees from Aberdeen can’t afford to live there.”

Shea countered that Carsins Run residents should not be forced to pay property taxes because they don't own the homes. Instead, residents will pay an entrance fee based on the models they choose. Shea said fees would start at a minimum of $224,000. Then residents would pay a minimum of about $2,800 a  month that would include landscaping, maintenance and utilities.

“We take care of the person for the rest of their life,” Shea said. “We do not make money.”

John Hesterly, of Ferndale Road, said people seemed focused on the project’s affordability rather than the need for continuing care.

“I think you should do everything you can to attract Carsins Run,” Hesterly said. “Harford County is the only county in Maryland that doesn’t have a continuing care retirement community. If something is overpriced,  it won’t be successful.”

Hesterly said residents who can afford continuing care communities shouldn’t be forced to move out of Harford County because no facility exists here to meet their needs.

“All I heard was your judgment,” Hesterly said. “Who are you to judge?”

Many who support the tax exemption for Carsins Run left after expressing their opinions. But during final comments, some council members criticized them for leaving early.

“We listened to them,” Councilwoman Sandra Landbeck said. “If you can live alone, you can pay your taxes as the rest of us do.”

Harford County would have to distribute half of the hotel tax revenue collected through a tentative funding formula that would allocate 70 percent to tourism and promoting Harford County an 30 percent to municipal grants in Harford County.

The other half of the projected annual tax revenues would be allocated as follows:

• $600,000 to Aberdeen to offset the cost of the tax credit for  Carsins Run, though the bill doesn't name the community.
•  $250,000 to the Ripken Stadium Authority, to offset annual expenses. 
• $150,000 to a fund for construction of Harford County Convention Center.

James said her legislation would result in numerous outcomes:

• Harford County would get the ability to levy a 5 percent sales tax on hotel rooms. 
• Although the developer isn’t specifically named in the bill, Presbyterian Home of Maryland would receive a $600,000 per year tax exemption from county and municipal real estate taxes for 15 years.
• And the city of Aberdeen would get a portion of the funds derived from the county's hotel tax to help maintain Ripken stadium for the next 10 fiscal years. Aberdeen would also be able to use funds it receives to offset immediate revenue losses suffered through the tax exemption given to the Presbyterian Home project, James said.
• Whatever money is leftover from the hotel room tax after a permanent funding formula is put in place, James said, would be used to promote countywide tourism. Those funds, in turn, could be used to levy matching tourism dollars from the state, James said.

 "Trying to bring all of the interested people together, I drafted a bill," James said.

Bennett said linking the hotel tax to the continuing care retirement community tax exemption is unfair.

 “We don’t support it on the backs of the folks in the city of Aberdeen,” Bennett said.