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Washington County Commissioners to discuss eliminating excise tax

February 01, 2012|By HEATHER KEELS | heather.keels@herald-mail.com

A discussion about eliminating the building excise tax will be part of upcoming budget deliberations by the Washington County Board of Commissioners, County Administrator Gregory B. Murray said this week.

Murray made the comment Tuesday during a discussion on creation of tax credits for “high performance” or “green” commercial buildings.

Ronald Bowers of the Hagerstown-Washington County Economic Development Commission told the commissioners that the panel’s Site Development and Regulatory Committee recommended phasing out the county excise tax for commercial development, as well as approving the green buildings tax credits.

The five commissioners voted unanimously to adopt the green building tax credits, but told Bowers they were not prepared to discuss eliminating the excise tax and would do so at a future meeting.

The green building tax credits will begin July 1 and remain available for a three-year period. The county will provide tax credits for commercial buildings that receive silver, gold or platinum certification in the national LEED, or Leadership in Energy and Environmental Design, ranking system.

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The amount of the credit will depend on which level of certification the building receives and the increase in its assessed value after construction.

LEED-Silver buildings will be credited 20 percent of the taxes due on that increase; LEED-Gold buildings, 25 percent; and LEED-Platinum, 30 percent.

Bowers said waiving the excise tax on commercial buildings would help encourage construction and boost employment.

“We need to get people excited about wanting to build,” he said.

The excise tax, assessed by the county on new construction, is used to help fund projects such as schools and roads.

“Excise tax is generally used for times when growth exceeds projections, and you have to move projects up; it helps fund those projects,” Murray said. “Typically, when growth is low or normal ... there’s an amount of infrastructure and projects that you should be budgeting for without excise tax.”

Currently, the county takes in about $1 million a year in excise tax, Murray said.

“We’ve said for quite awhile now that if there was any will to eliminate the excise tax, there’s less of it now than there ever was,” he said.

On the other hand, there is less revenue in general now, and many budgeted school and road projects are counting on excise tax revenue, so the commissioners would have to discuss what projects to cut if the excise tax were eliminated, Murray said.

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