A small band of progressive lawmakers took a small stand against a big tax break on the floor of the House of Delegates on Tuesday morning.
Without discussion or fanfare, 14 lawmakers voted against House Bill 432, which expands a property tax exemption for nonprofit charitable museums by repealing a prohibition for organizations on more than 100 acres of land. The measure passed with support from 122 lawmakers.
It’s a statewide bill, but was designed to benefit Glenstone, a fine art museum that sprawls along 290 acres near Potomac in Montgomery County.
The grounds include massive outdoor sculptures and exhibits as well as paths, streams, forests and meadows.
The bill would allow Glenstone to seek property tax exemption for all parts of the land that are used for museum purposes so long as Glenstone remains open to the public and doesn’t charge admission.
Montgomery’s county council and county executive submitted testimony opposing the bill, citing lost revenue.
Right now, state law allows Glenstone to exempt up to 100 acres. If the bill passes, the whole property could eventually be eligible and there are plans to use the entire acreage for artistic purposes. The county’s revenue loss would be about $308,700 annually if the whole property is exempted.
“The cost of this exemption would force the County to either absorb the revenue loss or shift the tax burden to its other taxpayers,” the county Office of Intergovernmental Relations wrote in a letter to the Ways and Means Committee.
The state’s property tax loss would be an estimated $34,800.
At a bill hearing, the chief House sponsor of the bill Del. Kathleen M. Dumais (D-Montgomery) said the county executive’s opposition to the bill was “short-sighted.”
After the floor vote, she called Glenstone a “wonderful, philanthropic effort” that is world-renowned. “In supporting the arts, this was an important initiative,” Dumais said. “… I think that supporting the arts in this way outweighs the property tax.”
Scott Brannan, vice president and treasurer of the Glenstone Museum Foundation, said the benefactors intend the property to be free and open to the public in perpetuity. A property tax exemption would help ensure that, he told lawmakers at the bill hearing earlier this session. The museum’s annual operating expenses are about $15 million this year, Brannan said.
Lobbyist Patrick “P.J.” Hogan, who represents Glenstone, pointed out to committee members that the museum could already put the land into a tax-exempt status under state law by seeking a conservation easement, but that could complicate the moving-about of outdoor exhibits.
But some lawmakers expressed concern that the property tax break doesn’t come with any guarantee that the land wouldn’t be developed in the future. While not in law, Brannan said the foundation’s bylaws include restrictions on future development.
Del. David Moon (D) was one of the lawmakers that voted against the measure on Tuesday.
Moon said he’s interested in the artistic endeavors at Glenstone and has tickets to attend in April, but remained concerned about property tax breaks for wealthy properties in the county when the local government faces a budget deficit.
The vote on the Glenstone exemption came just weeks after the Montgomery County delegation ended a lengthy debate about removing a property tax break for the wealthiest country clubs in the county, an initiative Moon has championed for years.
He said the confluence of a budget crunch, the tax loss and a lack of restrictions on future development at Glenstone meant he “wasn’t ready to sign off” on House Bill 432 this year.
Nine members of the Montgomery County delegation voted against the bill. A cross-filed measure sponsored by Sen. Nancy King (D) and Sen. Brian Feldman (D) passed the Senate 46-0.
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