480 ADDRESSES AND STATE PAPERS

Fiscal reform, in recognition of this reality, has created a better bal-
ance in the distribution of the tax burden. Income is the truest index
of ability to pay; current income rises in ratio to the rest of our econ-
omy. Thus a local income tax is the most equitable means to finance
local governments' expenditures. Fiscal reform has enabled local gov-
ernments to grant a 50% property tax credit to persons over the age of
sixty-five whose gross income does not exceed $5, 000. Fiscal reform
has recognized that the property owner is only one type of citizen
who benefits from governmental services. Fiscal reform has acknowl-
edged that the elderly do not have children in the public school system
and the pensioner does deserve a tax break. Fiscal reform has been
based upon the sound economic principle that any tax burden upon
the low income groups adversely affects their standard of living by
reducing their total buying power, while upon wealthier groups it
merely limits their saving power.

But fiscal reform does even more than end inequity. It is a positive
step to assure growth and progress. This year Anne Arundel County's
budget leaped to an unprecedented $65. 3 million—a 27% increase over
the previous year. This was the second largest local budget increase
in Maryland, yet your county government was able to finance an al-
most $13. 9 million increase with only a 3c (per $100 assessed valua-
tion) increase in your property taxes due to fiscal reform.

Fiscal reform brought Anne Arundel County net benefits exceeding
$7. 5 million or the equivalent of a 91^ per $100 increase in your prop
erty taxes. That means that without fiscal reform your property taxes
could have jumped 94«* this year.

Fiscal reform allocated additional State aid to your County's school
system totalling almost $5. 4 million. Fiscal reform for the first time in
Maryland's history established State aid to local law enforcement
agencies. Anne Arundel's streets and highways will be better patrolled
because your law enforcement agencies will have almost one million
extra dollars to invest in improved public safety.

Thus you can see what tax reform has accomplished. It has brought
greater equity to the individual and provided for special individual
problems and needs; it has created greater opportunity for community
growth by easing local government's financial obligations through addi-
tional State aid and alternative revenue resources that equalize and
balance the efforts of all our citizens.

We haven't thrown new taxes on the people but provided a just re-
distribution of the tax burden. We have put more money in our