About Special Taxing Districts
There are three types of special taxing districts in Anne Arundel County:
- Special Community Benefit Districts (SCBD)
- Shore Erosion Control Districts (SECD)
- Waterway Improvement Districts (WID)
Each type of district is established by legislation of the County Council. Once a district is established, any change in boundaries, purpose of the district, or method of taxation in the district must also be legislated.
A community might consider forming a special taxing district to finance a public benefit for the community that it does not have the ability to finance in any other way. Once the taxing district is formed, the community each year determines a tax rate to produce the revenue necessary to fund the benefit for the following fiscal year. The property owners are taxing themselves to fund the particular benefits.
Common Tax District Purposes
Have been formed for a variety of purposes, including:
- Maintenance of community property, including community-owned roads
- Special security or special police protection
- Improvements to community facilities
- Insect and pest control
Formed under County and State law for more specialized purposes, including:
- The construction, repair and maintenance of facilities for erosion control
- Building or repairing bulkheads
- Dredging of channels
In most cases, the improvements constructed are funded by no-interest State loans to the County on behalf of the districts. However, community associations may also use commercial loans to fund projects, and may use district funds to maintain projects after they are completed.
Helpful Documents & Resources
Frequently Asked Questions (FAQs)
Office of the Budget (budget-scbd@aacounty.org)
- Establishing a SCBD
- Modifying the purposes or type of tax rate or territory
- Approval of a loan to be paid for with SCBD funds
- Budget questions
- Determining if a planned purchase qualifies as a valid SCBD expense
Office of Finance (scbd_finance@aacounty.org)
- Collection and disbursement of funds
- Bond/ Certificate of Insurance
County Auditor’s Office (oca-scbd@aacounty.org)
- Audit questions
- Financial reporting questions
What it is:
- A taxing district; and
- A mechanism to collect taxes from persons that have a common need.
What it is NOT:
- Part of the County Government – the County merely collects and distributes the taxes in a fiduciary role;
- A legal entity – they cannot borrow funds, buy property, be sued;
- A Home Owners Association – nor do they “replace the Home Owners Association”
- A description of the properties included in the district
- The specific purposes of the SCBD – what they can spend funds on
- The entity that will be administering the District funds
- The Method of Tax
Valid petitions with a “Yes” vote are required from 2/3 of the owners of the property in the district.
Budget forms are sent out by November 1st and they are due back no later than January 31st.
If the SCBD annual expenditures are less than $250,000 a year you have to file an annual financial report and submit it to the County Auditor’s Office.
These are due by September 30 of each year.
If the SCBD annual expenditures are less than $250,000, the SCBD will be required to have an audit every 4 years unless the County determines, on a case-by-case basis, that more frequent audits are required.
The Office of Finance typically disburses funds in November, February, and June.
Disbursements may be held by the Office of Finance if the community association has not filed required financial statements/audits, is not in good standing with the State Department of Assessments, or does not have a sufficient bond or other security for its financial officers.
No per County Code § 4-7-101 a community or civic association must administer the district and its funds. More information on SCBDs and management companies can be found under SCBD Resources.