GO ITEM 2
October 20, 2014
Worksession
MEMORANDUM
October 16, 2014
TO:
FROM:
SUBJECT:
Government Operations and Fiscal Policy Committee
Josh Hamlin, Legislative
Attome~
Worksession:
Bill 22-14, Property Tax Rent Reduction Tax Credit
Bill 22-14, Property Tax
Rent Reduction Tax Credit, sponsored by Council Vice
President Leventhal and Councilmembers Berliner, EIrich, Floreen and Navarro, was introduced on
April 22, 2014. A public hearing was held on July 8.
State law authorizes the County to create a tax credit for a property owner providing
reduced rent to any tenant who is at least 65 years old or has been detennined to
be
pennanently
and totally disabled under various federal acts or by the County health officer. The County is
also pennitted to provide for additional limitations on eligibility for the credit. Bill 22-14 would
allow owners who charge reduced rent to eligible elderly or disabled tenants that is at least 15%
below market rent to apply for a credit against their County property tax. The amount of the
credit would be 50% of the difference between market rent and the reduced rent. The Bill caps
the total amount of credits granted during any fiscal year at $250,000, unless a larger amount is
approved in the annual operating budget or a Council resolution. Bill 22-14 would also require
the Executive to adopt regulations to administer the credit, including income- and asset-based
eligibility requirements for tenants.
Public Hearing and Correspondence
There were two speakers at the public hearing. Joseph Beach, Director of Finance
testified on behalf of the Executive in support of the Bill (©16). Mr. Beach did request that the
eligibility requirements for the credit be modified. W. Shaun Pharr of the Apartment and Office
Building Association of Metropolitan Washington (AOBA) also testified in support of the Bill
(©17-18).
Issues for Committee Discussion
1.
Should the Council expand eligibility for the credit?
At the public hearing, Joseph Beach requested that the Council amend the qualifications
of eligible tenants to be less restrictive by including a number of ways that a tenant could be
detennined to be disabled, thus allowing the tenant's landlord to become eligible for the credit
(see ©16). The Bill, as drafted, restricts eligibility to:
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tenant who meets the income- and asset-based eligibility requirements
established
by
regulation under subsection
ill
and:
ill
is at least 65 years old;
ill
has been found permanently and totally disabled and has qualified for
benefits under:
®
the Social Security Act;
all
the Railroad Retirement Act;
{Q
any federal act for members of the United States armed forces; or
@
any federal retirement system; or
ill
has been found permanently and totally disabled
by
the County health
officer.
The language in the Bill is identical to the qualifications set forth in the State enabling law (see
©6-7). While the enabling law gives the County the authority to provide by law for "additional
limitations on eligibility for the credit," it does not allow the County to relax the requirements set
in the State law. If the County were to do so, it would be exceeding the authority granted to it by
the State in the enabling law.
Staff understands that no other county in Maryland
has
provided for this credit; if Bill 22-14 is
enacted and the credit not used, or if the disability definition otherwise proves to severely limit
the credit's utility, the Council may wish to pursue a change to the State law via the County's
General Assembly delegation.
~
Staff recommendation:
Do not amend the eligibility requirements for elderly or disabled
tenants.
2.
County Attorney suggestions.
There were three suggestions for clarity and consistency recommended in the County Attorney's
memorandum (see ©14-15). First, the County Attorney believes that the provision allowing for
the County Health Officer to make a determination of permanent and total disability is
inappropriate for Montgomery County. Also, there are references in two subsections of the Bill
to "person" and ''taxpayer,'' respectively, which the County Attorney suggests should be changed
to "owner," as it is the owner who is eligible for the credit. Staff concurs with these suggestions.
Staff recommendations:
Delete the provision allowing for a determination of permanent and total disability by the County
Health Officer, by
amending lines
6-18,
as follows:
Elderly or disabled tenant
means
~
tenant who meets the income- and asset-based eligibility
requirements established
by
regulation under subsection
ill
and:
ill
is at least 65 years old; or
ill
has been found permanently and totally disabled and has qualified for benefits
under:
®
the Social Security Act;
all
the Railroad Retirement Act;
{Q
any federal act for members of the United States armed forces; or
2
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ill
@
any federal retirement system[[; or
has been found permanently and totally disabled
Qy
the County health officer]]:.
Amend lines 38-40 as follows:
ill
A credit granted to
Hf!
person]) an owner under this Section must not exceed the
amount of County property tax paid
Qy
the [[person]] owner in the tax year in
which the credit is granted.
Amend line
56
asfollows:
lID.
demonstrate that the [[taxpayer]] owner is entitled to the credit.
This packet contains:
Bill
22-14
Legislative Request Report
Md. Tax-Property Code, §9-219
Fiscal and Economic Impact Statement
County Attorney Memorandum
Joseph Beach Testimony
AOBA Testimony
Circle
#
1
5
6
8
14
16
17
F:\LAW\BILLS\1422 Rent Reduction Tax Credit\GO Memo.Doc
3
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Bill No.
22-14
Concerning: Property Tax
Rent
Reduction Tax Credit
Revised:
05/0712014
Draft No. 5
Introduced:
April 22, 2014
Expires:
October 22,2015
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ __
Sunset Date: _-,--_---::-_ _ __
Ch. _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Council Vice President Leventhal and Councilmembers Berliner, EIrich, Floreen and Navarro
AN
ACT
to:
(1)
(2)
create a property
tax
credit for a property owner providing reduced rent for certain
elderly or disabled tenants; and
generally amend the law relating to property
tax
credits.
By adding
Montgomery County Code
Chapter 52, Taxation
Section [[52-18T]] 52-18W
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill,
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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Bill No. 22-14
1
2
Sec.
1.
Section [[52-18T]] 52-18W is added as follows:
[[52-18T]] 52-18W.
disabled tenants.
Property tax credit
=
reduced rent for elderly or
3
4
W
Definitions.
In
this Section:
Director
means the Director of Finance or the Director's designee.
Elderlv or disabled tenant
means
£!:
tenant who meets the income- and
5
6
7
asset-based eligibility requirements established
.by
regulation under
subsection
ill
and:
8
9
10
11
ill
ill
is at least 65 years old;
has been found pennanently and totally disabled and has
qualified for benefits under:
12
®
ill)
the Social Security Act;
the Railroad Retirement Act;
any federal act for members of the United States armed
forces; or
13
14
15
16
©
(D)
any federal retirement system; or
17
18
ill
has been found pennanently and totally disabled
.by
the County
health officer.
19
20
21
22
Market rent
means an amount, detennined
.by
the Department of
Housing and Community Affairs, equal to:
ill
ill
the rent charged to other tenants for comparable units in the
same property; or
if there are no other comparable units in the same property, the
rent charged for comparable units in the same market area.
23
24
25
26
27
28
Reduced rent
means rent charged to an elderly or disabled tenant that
is at least 15% less than market rent.
Rent reduction
means the difference between the market rent and
reduced rent for the
dwellin~
F:\LAW\BILLS\l422 Rent Reduction Tax Credit\BiII S.Doc
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Bill No. 22-14
29
30
31
32
33
34
Tax-Property Article
means the Tax-Property Article of the Maryland
Code.
Oil
Credit.
As authorized
by
§9-219 of the Tax-Property Article, the
owner of !! rental dwelling who provides reduced rent to an elderly or
disabled tenant may receive !! credit against the County property tax.
(£)
Amount gfCredit.
35
36
37
38
39
40
41
42
43
44
45
ill
The credit allowed under this Section is 50% of the total rent
reductions provided
by
the owner to elderly or disabled tenants
during the
tax
year.
ill
A credit granted to !! person under this Section must not exceed
the amount of County property tax paid
by
the person in the tax
year in which the credit is granted.
@
Annual aggregate limit.
ill
Unless!! larger amount is approved in the annual operating
budget or !! Council resolution, during any fiscal year, the total
credits granted under this Section must not exceed $250,000.
ill
ill
Credits must be granted in the order in which the Department of
Finance receives complete applications under subsection
@
A complete application that, if granted, would cause the limit
set in paragraph
ill
of this subsection to be exceeded, must be
granted
in
the next fiscal year or years based on the order in
which the Department of Finance received the application.
46
47
48
49
50
51
52
W
Application.
ill
ill
A property owner must submit an application to the Director on
or before the date that the Director sets.
53
54
An
application must:
(A)
be on the form that the Director requires; and
55
CD
F:\LAW\BILLS\1422 Rent Reduction Tax Credit\BiJI 5.Doc
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Bill No. 22-14
56
57
all
demonstrate that the taxpayer is entitled to the credit.
ill
Regulations.
The County Executive must adopt regulations under
administer this Section, including income- and asset­
58
59
60
method
ill
to
based tenant eligibility requirements.
(g)
Applicability.
The credit authorized by this Section applies to any tax
61
year beginning after June 30, 2014.
Approved:
62
63
64
65
L.
Rice,
President, County Council
Date
66
67
Approved:
68
69
Isiah Leggett, County Executive
Date
70
71
72
73
This is a correct copy o/Council action.
Linda M. Lauer, Clerk ofthe Council
Date
G
F:\LAW\BILLS\1422 Rent Reduction Tax Credit\BilI S.Doc
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LEGISLATIVE REQUEST REPORT
Bill 22-14
Property Tax Rent Reduction Tax Credit
DESCRIPTION:
Bi1122-14 would allow owners who charge reduced rent to eligible
elderly or disabled tenants that is at least 15% below market rent to
apply for a credit against their County property
tax.
The amount of
the credit would be 50% of the difference between market rent and
the reduced rent.
The County wishes to ensure that affordable housing options are
available to elderly and disabled residents.
To provide property tax relief to owners who charge reduced rent to
eligible elderly or disabled tenants.
Office of Finance
To be requested.
To be requested.
To be requested.
To be researched.
Josh Hamlin, 240-777-7892
Tax credit applies Countywide.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
Not applicable.
F:\LAw\BILLS\1422 Rent Reduction Tax Credit\LEGISLATIVE REQUEST REPORT.
Doc
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Page 1
LexisNexis®
1 of 1 DOCUMENf
Annotated Code of Maryland
Copyright 2014 by Matthew Bender and Company, Inc., a member of the LexisNexis Group
All rights reserved.
"'**
Statutes current through Chapter 1 of the 2014 General Assembly Regular Session
**'"
**'"
Annotations current through December 7,2013
"'**
TAX - PROPERTY
TITLE 9. PROPERTY TAX CREDITS AND PROPERTY TAX RELIEF
SUBTITLE 2. STATEWIDE OPTIONAL
GO TO MARYLAND STATUTES ARCHIVE DIRECTORY
Md. TAX-PROPERTY Code Ann.
§
9-219 (2014)
§ 9-219. Rental dwellings providing reduced rents for elderly or disabled tenants
(a) Qualifications for credit. -- The Mayor and City Council ofBaltimore City or the governing body of a county or of
a municipal corporation may grant, by law, a property
tax
credit against the county or municipal corporation property
tax imposed on rental dwellings of owners who provide reduced rents for any tenant who:
(I) is at least 65 years old;
(2) has been found permanently and totally disabled and has qualified for benefits under:
(i)
the Social Security Act;
(ii) the Railroad Retirement Act;
(iii) any federal act for members of the United States armed forces; or
(iv) any federal retirement system; or
(3) has been found permanently and totally disabled by a county health officer or the Baltimore City
Commissioner of Health.
(b) Eligibility; amount and duration; implementation. -- The county or municipal corporation may provide, by law,
for:
(I) the specific requirements for eligibility for a
tax
credit authorized under this section;
(2) additional limitations on eligibility for the credit;
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Page 2
Md. TAX-PROPERTY Code Ann.
§
9-219
(3) the amount and duration of the credit; and
(4) any other provision appropriate to implement the credit.
HISTORY:
1991, ch. 415; 1995, ch. 3,
§
1.
NOTES:
LexisNexis 50 State Surveys, Legislation
&
Regulations
Archaeological and Historic Sites
(j)
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ROCKVILLE, MARYI..Ai'iD
MEMORANDUM
May 12,2014
TO:
Craig Rice, President, County Council
Jennifer A. Hughes, Di
Joseph F. Beach, Direct
M
FROM:
SUBJECT:
.Ice of Management and Budget
ment of Finance
FEIS for Council Bill 22 l • Property Tax - Rent Reduction Tax Credit
Please find attached
the
fiscal and economic impact statements for
the
above­
referenced legislation.
JAH.:fz
cc:
Bonnie Kirkland, Assistant Chief Administrative Officer
Lisa Austin, Offices of the County Executive
Joy Nunni, Special Assistant to the County Executive
Patrick
Lacefield, Director, Public Information Office
Joseph F. Beach, Director. Department of Finance
Michael Coveyou, Department of Finance
David Platt, Department of Finance
Robert Hagedoorn,
Department
of
Finance
Jed Millard,
Office of Management and
Budget
Alex Espinosa, Office of
Management and
Budget
Felicia Zhang, Office of Management and Budget
Naeem Mia, Office of Management and Budget
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Fiscal Impact Statement
Council Bill 22*14, Property Tax - Rent Reduction Tax Credit
1.
Legislative Summary.
Bill 22-14 would create a property
tax
credit for any property owner providing reduced
rent to any tenant who is at
least 65
years old or has been detennined to be permanently
and totally disabled tmder various federal acts or by the County health officer. The
Bill
would allow property owners who charge reduced rent to eligible elderly or disabled
tenants that is at least
15
percent below market rate to apply for
a
credit against their
County property
tax.
TIle amount of the credit would be
50
percent ofthe difference
between market rent and the reduced rent. The
Bill
would also require the COWIty
Executive to adopt regulations to administer the credit, including income- and asset-based
.
eligibility requirements for
tenants.
2.
An estimate of changes in County revenues and expenditures regardless of whether the
revenues or expenditures
are
assumed in the recommended or approved budget Includes
source of infonnation, assumptions, and methodologies used.
Pursuant to section (d)(l) of Bill 22-14, "unless a larger amount
is
approved in the annual
operating budget or a Council resolution, during any fiscal year, the
total
credits granted
under this Section
must
not exceed
$250,000,"
The Department of Housing and Community Affairs (DHCA) believes that there would
be few, ifany, applicants for this tax credit program as the
Bill
provides no incentive for
property owners to provide tenants with reduced rent. The amount of a credit a property
owner could be granted
is
only
50
percent ofthe difference between market rates and
the
reduced ratc. However, due to already thinly stretched resources in the Department of
Finance,
if
there are applicants for this program, one additional full-time administrative
position at Grade
18
would be required
to
administer any new properry
tax
credits created
by the County. This amounts to
a
cost of approximately
$12,000
annually
to
the
Department in total personnel costs.
Considerable staff time may also be required by the DHCA to conduct research on renter
statistics
and to certify
eligibility
oftenants and property owners (landlords).
At this time,
it
is not possible to accurately quantifY the total number and amOlU1t of tax
credits
that
would be granted under this program. Data is 110t readily available
as
to how
many tenants in the County would be eligible and are paying reduced rents and how
many property owners would apply for the credit.
3.
Revenue and expenditure estimates covering at least the next
6
fiscal years.
See #2.
4.
An
actuarial analysis through the entireamonization period for each bill that would affect
retiree pension or group insurance costs.
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N/A
5. Later actions that may affect future revenue and expenditures if the bill authorizes future
spending.
Any appropriation in the operating budget or by Council resolution to raise or lower the
maximum level of support for
this
tax
credit program would affect future expenditures.
Creation
of
any incentives for property o"vners to offer reduced
rents
would also increase
expenditures.
6.
An estimate ofthe staff time needed to implement the bilL
DHCA
believes that there would be few, if any, applicants for
this
tax credit program as
the Bill
provides no incentive for property owners to provide tenants with reduced rent.
However, due to already thinly stretched resources in the Department of Finance,
if
there
are applicants for this program, one additional full-time administrative position
at
Grade
18
would be required to administer any new property tax credits created
by
the County_
This amounts to
a
cost of approximately
$7:2,000
annually to the Department in total
personnel costs.
Considerable stafftime may also be required by
DHCA
to conduct research on renter
statistics and to certify eligibility.oftenants and property ov.ners (landlords).
7. l\n explanation of how the addition of new staff responsibilities would affect other duties.
Duties of current staff would not be affected with the addition ofone
full-time,
Grade
18
administrative position in the Department
of Finance.
8.
An
estimate of costs
when an
additional appropriation
is
needed.
See #5.
9.
A description of any variable
that
could affect revenue
and
cost estimates.
Variables affecting revenue
and
cost estimates include, but are not limited to:
a. The
number of eligible elderly or disabled tenants in the County
h. The
number
of
property owners providing rent for eJigibIe tenants at least
15
percent below market rates
c. The number of eligible property owners who apply for the program
d. Creation of incentives for property owners to provide reduced rent to eligible
tenants
10. Ranges of revenue or expenditures that are uncertain or difficult to project.
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At this time,
it
is not possible to accurately quantify the total number and amount of
tax
credits that would be granted under this program. Data is not readily available as to how
many tenants in the COlmty would be eligible and are paying reduced rents and how
many property owners would apply for the credit.
Considerable staff time may be required by DHCA to conduct research on renter statistics
and
to
certify eligibility of tenants and property owners (landlords).
11. If a bill is likely to have no fiscal impact, why that is Ule case.
NlA
12. Other fiscal impacts or comments.
N/A
13. The following contributed
to
and concurred with this analysis:
Richard Y. Nelson, Director, Department of Housing and Community Affairs
Michael Coveyou, Department of Finance
Jedediah Millard, Office of Management and Budget
Date
:"
@
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Economic Impact Statement
Bill 22-14, Property Tax - Rent Reduction
To
Credit
Background:
This legislation would create a property tax credit for a property owner providing reduced rent
for certain elderly or disabled tenants. Bil122-14 would allow o'Wners who charge reduced rent
(at least fifteen percent
(15%)
below market rent) to eligible elderly or disabled tenants to apply
for
a credit against their County property tax.
The
amount of the credit would be fifty percent
(50%) ofthe difference between the market rent and the reduced rent. Bill 22-14 would limit the
total credits granted
to
$250,000 during any f:iscal year unless a larger amount
is
approved either
in the annual operating budget or a Council resolution.
1.
The sources of information, assumptions, and methodologies used.
Sources of information and data include the Department of Finance. the Department of
Housing and
C(ln1munity
Affairs (DHCA), and the American Community Survey (ACS),
U.s. Bureau of the Census.
The assumption is that there would be fewer
than
200 credit requests according
to
information provided by
DHCA.
According to ACS, the number of renter-occupied housing
units
in Montgomery Cotmty
with
the age of the head of the household 65 years or older was 17,431 in 2012. According to the
survey, nearly 10,000 household's gross rent
is
thirty-five percent or more of total household
income. However, the total number ofeligihle households would
be
limited because
households who reside in either Moderately Priced Dwelling Units (MPDU) or receive
a
subsidy are not eligible for this credit.
2. A description or any variable that could affect the economic impact estimates.
The variables that could affect
the
economic
impact
estimate
are
the total amount of the
credit that is available, the number of credit requests, the average monthly rent in the County,
and, at a minimum, the number of renter-occupied housing units
'with
the age of the head of
the household 65 years or older, and
the
number of renter-occupied housing
units
that
arc
classified
as
either MPDUs or receive a subsidy.
3. The Bill's positive or negative effect,
if
any on employment, spending, saving,
investment, incomes, and property values in the County.
According to infom1ation provided by DHCA. the Bill would likely have very little economic
impact on personal income
to
the renters
and
business income of
the
property o\\!ners.
Tenants who reside in an MPDU or receive a subsidy would be excluded from receiving the
credit. DHCA suggest..;; that because property o\\>ners
\\-no
apply for this ptogram would
have to incur lost rent
in
the amount of fifty percent ofthe rent reduction, there would not be
an economic incentive,
in
most cases,
to
voluntarily reduce the rent for the eligible occupants
in
exchange for
the
property
tax
credit.
Page lof2
@
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Eeonomic Impact Statement
Bill 22-14,
Property Tax - Rent Reduction Tal: Credit
4.
If
a Bill is
Jikely
to have no economic impact,
why
is that the case?
The Bill is likely not
to
have a material economic impact for reasons presented in #3 above.
5.
The (ol1owing contributed to and concurred with
this
analysis:
David Platt, Rob
Hagedoom. and Michael Coveyou, Finance; and Richard Nelson, Department of Housing
and Community Affairs.
~,;ttecro~
Department of Finance
Page2of2
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OFFICE OF THE COUNTY ATIORNEY
Isiah Leggett
Coumy Executive
Marc P. Hansen
County
AlTomey
MEMORANDUM
TO:
VIA:
Joseph Beach, Director
Department of Finance
Marc P. Hansen
County Attorney
Scott R. Foncannon
Associate County Attorney
May 6,
2014
Bill
22-14,
Property Tax - Rent Reduction Tax Credit
FROM:
~I~
\,.-1.
L-,--",
DATE:
RE:
I have had an opportunity
to
review Bill
22-14,
Property Tax - Rent Reduction Tax
Credit recently introduced by the Montgomery County Council.
This Bill creates a property tax credit for property owners who provide rent reduction to
elderly or disabled tenants. This real property tax credit is authorized by Section 9-219 ofthe
Tax-Property Article of the Almotated Code of Maryland. This enabling law does authorize a
tax credit of
50%
of the total rent reduction provided by an owner to an elderly or disabled
tenant. Subject to my comments be10w, the Council is authorized and enabled by State law to
adopt this tax creclit and it is within the authority of the County CounciL
J
have the following
comments concerning this Bill.
The
Bill
specifically provides that a dctennination that an individual
is
permanently or
totally disabled can
be
made by the County Health Officer. To my knowledge the County Health
Officer, Dr. Tillman. does not have the authority to fmd someone permanently and totally
disabled nor is there a process in place for this kind of determination or finding. Currently the
Health Officer does not make this type of assessment of disability level and
it
is not clear what
the parameters or procedures are for this type of flnding. I recommend that this sentence be
removed from the
Bill.
The State law Enabling Act does have this language in the statute,
however, it may apply
to
other counties where there health officer can make this type of
determination, however, I
think
it is inappropriate for Montgomery County.
101 Monroe Street. Rockville. Maryland 20850-2580
(240) 777-6795
nD
(240)
777-2545.
FAX (240) 777-6705 • scoltfom:annoll@momgomerycountymd.gov
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Joseph Beach
May 6, 2014
Page 2
The Bill refers to market rent and specifically to a market area. The term market area is
not defined and
it
is not clear what the market area would include.
My fmal comment concerns the use of the word "taxpayer" rather
than
"owner" in
Sections
52~
18(t) subparagraph (c)(2) and in subparagraph (e)(2)(b). I believe the proper word
to use is '<owner", because State law states that the credit is permitted for rent reductions
provided by the "'owner" of the property. The taxpayer may not necessarily be the owner if for
example the lease provides that the tenant pay the taxes.
I have no further comments concerning this Bill.
cc:
Bonnie
A.
Kirkland, Assistant Chief Administrative Officer
Offices of the County Executive
SRF:jq
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TESTIMONY ON BEHALF OF COUNTY EXECUTIVE ISIAH LEGGETT ON
COlJNCIL BILL 22-14, PROPERTY TAX-RENT REDUCTION TAx CREDIT
July 8, 2014
Good afternoon, my name is Joseph Beach, Director of the County Department of
Finance and I
am
here on behalf of County Executive Isiah Leggett to testify in support of
Council Bill 22-14, Property Tax - Rent Reduction Tax Credit.
Council Bill 22-14 would allow property owners who charge reduced rent to eligible·
elderly or disabled tenants that is at least 15% below market rent to apply for a credit against·
their County property tax.
,
The existing long waiting lists for subsidized housing for elderly and disabled individuals
indicates that there is a significant need for these type of incentive programs to increase the
availability of affordable housing for these populations.
However, the definition of "disabled tenant" may unduly restrict the number of disabled
individuals who would qualify for inclusion in this program. Very few veterans or other
individuals with disabilities are considered to be totally disabled. This definition-which is also
found in state law-will significantly limit the number of people who will be able to benefit from
this legislation.
We recommend amendments to the legislation to include a tenant who has a permanent
disability and 1) is certified by the Maryland Department of Education Division of Rehabilitation
Services, or equivalent out-of-state vocational rehabilitation agency as meeting the standard of
disability; or 2) a Veteran rated by the Department of Veterans Affairs with a compensable
service-connected disability of 30 percent or more, or 3) an individual determined eligible for or
receiving benefits from the State of Maryland Temporary Disability Assistance Program.
The County Attorney has also suggested some clarifying and technical amendments to
the Council's legislative attorney.
I urge the Council to support this legislation with the recommended amendments. Thank
you for permitting me the time to address the County Council on this important matter.
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AOBA
APARTMENT and OFFICE
BUILDING ASSOCIATION
APARTMENT AND OFFICE BUILDING
ASSOCIATION OF
METROPOLITAN WASHINGTON
TESTIMONY BEFORE THE
MONTGOMERY COUNTY COUNCIL
ON
BILL 22-14, Property Tax - Rent Reduction Tax Credit
July 8, 2014
Submitted By:
W. Shaun Pharr, Esq.
Senior Vice PreSident, Government Affairs
1050 17th Street,
NW;
Washington, DC 20036
Phone: 202-296-3390 • Fax: 202-296-3399 • Email: webmaster@aoba-metro.org
URL: http://www.aoba-metro.org
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GOOD MORNING PRESIDENT RICE AND MEMBERS OF THE COUNCIL. I AM SHAUN
PHARR, SENIOR VICE PRESIDENT OF GOVERNMENT AFFAIRS FOR THE APARTMENT AND
OFFICE BUILDING ASSOCIATION OF METROPOLITAN WASHINGTON (AOBA), A NON·
PROFIT TRADE ASSOCIATION WHOSE MEMBERS ARE OWNERS AND MANAGERS OF
MORE THAN
110,000
APARTMENTS UNITS AND OVER 23 MILLION SQUARE FEET OF
OFFICE SPACE IN SUBURBAN MARYLAND, THE MAJORITY OF WHICH IS IN MONTGOMERY
COUNTY.
ON BEHALF OF OUR MULTIFAMILY HOUSING PROVIDER MEMBERS, I AM PLEASED
TO APPEAR TODAY IN SUPPORT OF BILL
22-14,
WHICH WOULD UTILIZE CURRENT
AUTHORITY GRANTED BY STATE LAW TO CREATE A "RENT REDUCTION TAX CREDIT"
FOR THE BENEFIT OF ELDERLY OR DISABLED RENTERS WHO MEET ELIGIBILITY
CRITERIA TO BE ESTABLISHED BY THE COUNTY EXECUTIVE AND WHOSE RENTAL
HOUSING PROVIDER HAS CHARGED THE TENANT A RENT THAT IS REDUCED AT LEAST
15% FROM THE MARKET RATE FOR THE UNIT THEY OCCUPY.
THE SOCIAL AND TAX POLICY CONCEPT UNDERLYING THE BILL IS A FAMILIAR
ONE-IT WOULD TAKE WHAT IS COMMONLY KNOWN AS "CIRCUIT BREAKER"
PROTECTION FROM THE PRESSURE OF RISING REAL PROPERTY TAX ASSESSMENTS FOR
CERTAIN ELIGIBLE HOMEOWNERS AND ADAPT IT TO PROVIDE A SOMEWHAT SIMILAR
BENEFIT TO ELIGIBLE RENTERS, SINCE THEY, TOO, MAY FEEL ANALOGOUS PRESSURE
IN THE RENT THEY PAY. IN ADOPTING SUCH A POLICY, MONTGOMERY COUNTY WOULD
JOIN NUMEROUS OTHER JURISDICTIONS ACROSS THE COUNTRY. COUNCILMEMBER
LEVENTHAL AND COUNCILMEMBERS BERLINER, FLOREEN AND ELRICH ARE TO BE
COMMENDED FOR PROPOSING TO UTILIZE THE AUTHORITY GRANTED BY STATE LAW,
AND AOBA LOOKS FORWARD TO ASSISTING THE GOVERNMENT OPERATIONS
COMMITTEE AND COUNCIL IN DOING SO.
THANK YOU AGAIN FOR CONSIDERING THE VIEWS OF AOBA MEMBERS.
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