For Immediate Release: Wednesday, May 18, 2016
The Montgomery County Council today unanimously enacted a bill that will generate funding for additional school construction, County government projects and affordable housing. Council President Nancy Floreen was the lead sponsor of the legislation, which will raise about $200 million more than what the County Executive had proposed over the next six years, and will address the County’s most urgent capital needs—school construction and community infrastructure.
Montgomery Council unanimously approves plan
to stimulate funding for
school construction and affordable housing
Additional $200 million will fund capital projects and support more
than Board of Education’s request for school construction;
also provides rental assistance for low income residents
ROCKVILLE, MD., Wednesday, May 18, 2016—The Montgomery County Council today unanimously enacted a bill that will generate funding for additional school construction, County government projects and affordable housing. Council President Nancy Floreen was the lead sponsor of the legislation, which will raise about $200 million more than what the County Executive had proposed over the next six years, and will address the County’s most urgent capital needs—school construction and community infrastructure.
The County will be able to fund more than $1.72 billion in capital projects for Montgomery County Public Schools (MCPS) over the next six years, which is the highest funding level ever provided. This is also more than the Board of Education’s request.
The Council’s action on Expedited Bill 15-16 generates about $200 million in Fiscal Years 2017-22 for capital projects, mostly for school capacity and building improvements, despite having to close a shortfall in State aid of more than $24 million. Also, about $5 million in additional revenue will be allocated annually for rental assistance to low and moderate income households.
The recordation tax is paid only when properties are sold or refinanced. The seller and buyer divide the cost evenly if there is no contractual agreement regarding the recordation tax payment. For first-time homebuyers, the seller pays the recordation tax, if there is no alternative agreement in the contract.
Expedited Bill 15-16 will increase the basic rate of the Recordation Tax by $1 per $500 in the sale or refinancing and the Recordation Tax Premium by $0.75 per $500 in the sale or refinancing.
The Tax Premium only applies to sales and refinancing above $500,000. To make the rate change more progressive, the Council raised the exemption for homebuyers from $50,000 to $100,000 for owner occupied homes. For example, the recordation tax on a $300,000 home would rise from $1,725 to $1,780, an increase of $55 (3.2 percent). The Council also delayed the implementation date of the bill to Sept. 1, 2016.
The funds raised by the rate change in the School Increment will be dedicated to MCPS capital projects. The new funds will allow the Council to add nearly $170 million to accommodate school capacity and building improvement needs.
“As parents well know, and testified to earlier this spring, our schools are bursting at the seams,” said Council President Floreen. “While nobody likes the idea of increasing taxes of any kind, our needs are great, and the recordation tax is the most progressive approach to meet the needs our residents have clearly identified as their top priorities. The recordation tax is just one piece of what I call an ‘education first’ budget that will finally give our students some long-overdue relief.”
Some highlights for school construction, compared with the County Executive’s recommended Capital Improvements Program (CIP) funding, include: completing the Wootton High School revitalization/expansion and the Walt Whitman High School addition in August 2021, instead of a one-year delay; completing additions for East Silver Spring and Greencastle Elementary Schools in August 2022, which would otherwise be unfunded; completing the Pyle Middle School and Pine Crest Elementary School additions in August 2020, instead of a one-year delay; and adding significantly more funding for heating, ventilation and air conditioning replacement in Fiscal Year 2017.
Other community projects that will benefit from increased CIP revenue include: tripling resources for bicycle and pedestrian priority area improvements to $15 million over the next six years; sidewalk improvements on Bradley Boulevard and Franklin Avenue; bike lanes and turn lanes on Bradley Boulevard; and improvements to Ovid Hazen Wells Park in Clarksburg.
More information about Expedited Bill 15-16 is available at: http://tinyurl.com/jlk2qbw .
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Release ID: 16-162