One advantage of "incorporation" would be that you can deduct a property tax you can't deduct an HOA fee.

You are absolutely right. What makes the math interesting is that one would need to equate the increase in tax on conversion to a municipality and see how much it would be offset by the tax deduction. Further complicating matters is that a good number of OP tresidents are retirees, most likely now in a lower tax bracket, which may not make a tax deduction so attractive. Of course since just under 1/2 the homeowners of Ocean Pines are non-residents, most likely still working and itemizing, a tax deduction might be something they would consider attractive.

I still believe that the uncertainty of the situation, should such a proposal ever be put to a vote, would negate any chance of such a conversion. But what do I know. In 1968 I drove all around this place looking at all the "future home of" placards for Yacht Club etc. and the rumor of a "new bridge" over the bay running thru Ocean Pines and had my doubts then. Never say never. It sure would take some of the confusion out of our address situation.