For Immediate Release: Wednesday, March 6, 2019
Bill strengthens tax exemption for housing projects that make 25 percent
or more of new units affordable to residents with moderate incomes
ROCKVILLE, Md., March 6, 2019 -- Councilmember Hans Riemer (D – At-Large), Chair of the Council’s Planning, Housing and Economic Development Committee, introduced Bill 5-19 to strengthen an affordable housing incentive at the Council’s March 5 session.
Current law provides that when buildings set aside 25 percent of their units for affordable housing programs, they are eligible for waivers of impact taxes. This incentive was established by Council Bills 8-15 and 36-17, starting in 2015.
Riemer’s Bill 5-19 clarifies that a qualifying project must be at least 25 percent Moderately Priced Dwelling Units (MPDUs). Under current law, a project must be 25 percent affordable housing to qualify, but not necessarily MPDUs. Some units may be affordable but their restriction only lasts for 15 years, for example. MPDUs remain affordable for 99 years and are restricted to residents who earn 65 percent or less of the Area Median Income, currently $82,000 for a family of four or 70 percent for high rise construction.
Councilmember Riemer issued the following statement on the legislation:
“The cost of living in Montgomery County is a major problem for families across the income spectrum, and housing costs are at the core of this problem. This program is a direct investment by the County in new affordable housing. Our housing partners, both for-profit and nonprofit, know that they can count on these funds because eligibility is written into the law. As opposed to an investment by the Housing Initiative Fund, for example, this affordable funding does not require a protracted negotiation; it is a certainty.
“It will take a wide variety of tools to ensure that every family that wants to make a home in Montgomery County can find affordable, safe housing. Our MPDU program is one of the tools that has made a big difference, for those families that are lucky enough to get a qualifying unit. This incentive makes more of these units available and that is a worthy use of public dollars.”
On March 1 the Council received a memo from Timothy Goetzinger, acting director of the Department of Housing and Community Affairs. Director Goetzinger reported that three projects have taken advantage of this incentive in the past year. Two are senior housing projects with a very high percentage of affordable housing - one in Fairland, across from the East County Regional Center, with 50 percent affordable units and one in Damascus providing 94 percent affordable units. The third project is a multi-family development in Clarksburg providing 25 percent MPDUs. Two projects had qualified for the incentive in past years, one in Germantown and one in the Olney area, each providing 25 percent MPDUs. Together, these projects add 379 regulated affordable units to the County’s housing stock. Several additional projects have signaled their intent to use this program, including at least two in downtown Bethesda, one of the areas of the County that most desperately needs additional affordable housing.
In his comments at the introduction of this legislation, Councilmember Riemer signaled openness to explore other approaches to improve this incentive and ensure that the County is getting maximum value for its investment. He encouraged all stakeholders to send comments and ideas to ensure the best possible results. A public hearing is scheduled for 1:30 p.m. on March 26 or written comments can be submitted to county.council@montgomerycountymd.gov.
Release ID: 19-081