The squeeze is on for Prince George’s County residents with the County Council passing increases for income taxes and other fees Tuesday that will add pressure to the county’s slowly diminishing upper-middle class.
Lawmakers hope that an incentive package in the plan, will encourage upper-middle class families to stay, but in the past decade there’s been a steady shift of lower income groups moving into Prince George’s and higher income groups moving out, a Brookings Institution study has found.
Residents were moving out of the county as they climbed the ranks of the middle class, became more mobile and could afford to be farther from the more dangerous Prince George’s streets, the study said.
With the income tax making a moderate leap from 3.1 percent to 3.2 percent — joining Montgomery County as the only other in Maryland to reach the state maximum — it’s businesses and those with more income who may feel the crunch as the economy continues to struggle around them, the Prince George’s County Chamber of Commerce wrote in a letter to council members.
“Additional taxes may have a negative effect on the business community and should beavoided if possible,” the chamber wrote.
And while some of the minimal increase to the fee charged when property changes hands may add some stress to the home-buying process, the “dedicating of [the fees] to the schools and police means the home-buying public would benefit,” said Michael Graziano, government affairs director for the Prince George’s County Association of Realtors.
That’s why the realty association remained neutral on the subject; unhappy with the fee increase, their concerns were abated by the notion that improved public safety and education would help attract new, possibly more wealthy, buyers, Graziano said.
Meanwhile, he noted, the county’s housing market is still cheaper than its neighbors and the fee is “low enough that it wouldn’t impact the changing demographics,” he said.
County Executive Jack Johnson proposed the increases in March as part of his effort to fill a $112 million budget gap.
He has also frozen hiring for all nonpublic safety positions.
