Intra-Metropolitan Area Fiscal Capacity Disparities and the Property Tax: The Washington DC Region

March 01, 2004

Funding: Lincoln Institute of Land Policy

Summary: The study adapts a methodology developed by the U.S. Advisory Commission on Intergovernmental Relations, to calculate disparities in the revenue capacity of local governments in the Washington,DC area. It then estimates the effect a shift to a real property tax on land only would have on these disparities. We found that the major disparities were between suburban jurisdictions; Washington D.C., the core center city in the metropolitan area, had an average revenue capacity. When revenue capacity was recalculated assuming a real property tax on land only, we found this had a slight positive effect on ameliorating differences in revenue-rising ability.