Real estate group Renew Baltimore sues city to force property tax cut onto November ballot

A couple of real estate brokers and a wealth manager are taking Baltimore’s board of elections to court over a ballot measure that would cut city property taxes nearly in half.

The lawsuit filed Friday in circuit court seeks to overturn a ruling by city Election Director Armstead Jones that declared that the proposal breaks state law, according to a news release from Renew Baltimore, the ballot issue committee raising money for the tax cut.

“Renew Baltimore asserts that its petition to amend the Baltimore City Charter is legally permissible in accordance with Maryland State law,” the committee, which has gathered over 23,500 signatures, said in a news release.

Benedict Frederick, who calls himself “a renowned name in Baltimore’s real estate industry for three generations,” Matthew Wyskiel a money manager and investor, and real estate agent and broker Stacie Teal-Locust are listed as plaintiffs, according to court documents. An attorney representing the plaintiffs did not return a request for comment Monday evening.

The proposal asks to cut the rate from 2.248% to 1.2% over seven years and could have a major impact on city finances. Baltimore had about $3.6 billion of revenue in fiscal year 2023, according to the city’s annual audited financial report. Almost 30% of that money — about $1 billion — came from the property tax.

In the ruling last week, Jones said cutting the property tax rate is the jurisdiction of the mayor and City Council. He cited a 1990 case in which the Maryland Court of Appeals, now the Supreme Court of Maryland, ruled that Baltimore and Anne Arundel counties could set a cap on property tax rates but could not roll back rates to lower levels. The court made a similar ruling in Talbot County in 1995. Renew Baltimore argues, citing the same 1990 case, that their proposal is a tax cap instead of a cut and is, therefore, permissible.

According to campaign finance records through June 14, Renew Baltimore had over $105,000 in cash balance in March 2022 and has since received around $52,000 in contributions, and spent over $129,000, which equals over $5 per signature. Renew Baltimore has spent $120,000 in consulting fees to the Fells Group since March 2022.

The Greater Baltimore Board of Realtors PAC gave $23,000 to Renew Baltimore while the Maryland Multi-Housing Association PAC contributed $30,000, campaign finance records show. The campaign also received $25,000 each from CFG Community Bank and developer Terra Nova Ventures.

Frederick cut the campaign a $10,000 check in February, according to campaign finance records. Treasurer Anirban Basu, chairman of the Maryland Economic Development Commission under then-Gov. Larry Hogan, has contributed $5,000, and Wyskiel, founder of wealth management and investing firm Skill Capital Management who is also listed as a treasurer in campaign finance documents, has given the campaign over $9,800. Another private equity investor, Benjamin Griswold, gave $10,000 last month, according to campaign finance records.

Christopher Meyer, a research analyst with the Maryland Center on Economic Policy, said earlier this month that Baltimore would need to gain 325,000 new residents within seven years to maintain existing tax revenue if the cut is enacted. Last month Mayor Brandon Scott called the proposal “dramatically short-sighted.”

During its campaign, Renew Baltimore argued that the cut would attract more residents and businesses to the city, increasing its tax base and offsetting the hit to city revenue.