AGENDA ITEM #7
December 8, 2015
Public Hearing/Action
MEMORANDUM
December 4,2015
TO:
FROM:
County Council
~lenn
Orlin, Deputy Council Administrator
Amanda Mihill, Legislative Attorney
IlfJt;AdL·
Public Hearing/Action: Expedited Bill 47-15, Taxation - Transportation Impact
Tax - Revisions
SUBJECT:
GO Committee
(and Council stafJ)
recommendation (3-0): Approve this bill with the
following amendment to Section 52-93(g):
(g) Any credit issued under this Section before December
~
2015 expires 6 years
after the Director certifies the credit. Any credit issued under this Section on
.Q!
after
January
b
2016 expires 12 years after the Director certifies the credit.
The Committee's recommended version of the bill is on ©15-17.
***
Expedited Bill 47-15, Taxation Transportation hnpact Tax - Revisions, sponsored by
Lead Sponsor Council President at the request of the County Executive, was introduced on
November 17,2015. This bill would revise the life of a credit certified after a certain date; allow
a credit for reconstruction of an existing road; and generally amend County law regarding impact
taxes.
Expedited Bi1147-15 is nearly the same as Bill 30-15 introduced on June 16,2015 at the
request of the Executive, except that Bill 30-15 would have eliminated the transportation and
school impact tax exemptions in former enterprise zones. A week later the Council withdrew Bill
30-15, again at the Executive's request. Expedited Bill 47-15 includes two elements of Bill 34­
15, Taxes - Transportation and School Impact Tax Amendments, for which a public hearing was
held on July 21,2015. Bill 34-15 has not yet been scheduled for a Committee worksession.
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Life of credits.
A developer can earn a credit if he or she builds additional capacity­
usually as a condition of subdivision approval-such as building a new or widened major road,
hiker-biker trail, bikeshare station, park-and-ride lot, purchasing additional Ride On buses, or
adding permanent classrooms in the form of a new school or addition. The credit can then be used
to offset the development's impact tax payment. From 1986 (when the initial impact fee law was
adopted) until 2004 such credit did not expire. However, when the Council amended the law in
2003, it was concerned that the credits sapped the revenue available for needed transportation
improvements, so it placed a 6-year expiration on all credits granted on or after March 1, 2004.
The rationale for selecting 6 years was that it is the duration of a CIP period.
In late 2010, after the Council suspended work on a Clarksburg Town Center Development
District, it established the Clarksburg Infrastructure Working Group to recommend alternative
means for funding Clarksburg'S infrastructure. One ofthe members, David Flanagan ofElm Street
Development (the developer of Clarksburg Village southeast of the planned Town Center)
advocated extending the expiration date from 6 to 20 years. The Working Group ultimately agreed
with him, stating in its April 2011 report:
The Group unanimously believes that the 6-year use-it-or-Iose-it provision should be extended to
20 years, which is the expiration period for WSSC's System Development Charge credits. The
current rule unfairly penalizes larger developments that have an extended buildout period. The
developers will feel more assured to build their required road improvements sooner if they know
their credits will not expire so quickly.
In Expedited Bill 47-15 the Executive is recommending extending the expiration date to
12 years-the duration of two CIP periods-which he notes is a compromise between the current
6-year rule and the 20 years recommended by
Mr.
Flanagan and the Working Group. (Twelve
years is also the duration of two CIP periods.) He recommends that the 12-year credit apply to
any credit certified after January 1,2016.
In trying to get a handle on how much in credits the Department of Transportation (DOT)
has certified and how much of that has expired, the Department of Permitting Services has
provided information about all the credits certified since March 2004, when the 6-year limit went
into effect (©14). This information shows that:
• There were $35.7 million of credit certified by DOT in 2004-2009, of which there was a
"balance" of about $25.6 million. So only about $10.1 million ofthe $35.7 million (28%)
total credit was used as offsets against impact taxes; the "balance" of $25.6 million is not
really a balance, since it has entirely expired by now.
It
is possible that much of the
development did not proceed because of the recession, or (in some cases) the creditable
road improvement was worth more than what the development's impact tax burden was.
• There were $36.9 million of credit certified by DOT from 2010 to the present, of which
there is a balance ofabout $15.9 million. So far then, about $21 million ofthe $36.9 million
(57%) of the credit has been used as offsets against impact taxes, with the most recent
credits certified from a development (Cabin Branch) that is likely to draw down much or
all of its balance within the next 6 years.
2
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Expedited Bill 47-15's 12-year limit applies to future credits certified, of course. Council staff
believes the proposal of extending a credit's life from 6 to 12 years is fair, but the data suggests
such an extension could result in a sizable reduction in revenue that the County would otherwise
collect once the economy emerges from any future slowdown.
The transportation and school impact tax laws are similarly constructed. Regarding the
duration of credits, each currently
has
a 6-year limit. The same rule should apply to both taxes, as
the public policy argument for them is the same. Therefore, should the Council agree with the
Executive's recommendation for the transportation impact tax, Council staff recommends
amending the credit section of the school impact tax law-Section 52-93(g}-as follows:
(g) Any credit issued under this Section before December
11
2015 expires 6 years after the Director
certifies the credit. Any credit issued under this Section on or after Janumy
1..
2016 expires 12
years after the Director certifies the credit.
Since the school impact tax went into effect in early 2004 there have been no credits granted, so
this provision may not have much of an effect. However, should a developer apply for and be
granted a credit for building a new school or addition, or even for improvements to prepare a site
for construction for a new school, such a credit should have a 12-year life.
Creditfor road construction.
One ofthe intents of the original impact fee law was to allow
a developer to meet the impact fee requirement by paying the fee, or offsetting all or part of it by
building or widening a road by the cost ofthat improvement. The point was that either a developer
would pay money to the County to make an improvement, or would save the County the same
amount of money by building the improvement himself or herself. If widening a road meant
tearing up an existing road to re-grade and build a new 4-lane road, for example, then the credit
should be equal to the developer's cost of doing just that-not a pro-rata share of the cost based
on the percentage of new capacity being added.
This situation sometimes occurs with road improvements, especially when an old two-lane
road is re-graded and relocated to create a multi-lane road. For many years now DOT has been
allowing credit only for the pro-rata share of the cost of such improvements, rather than the entire
cost. Certainly this method of calculating credit allows for more net impact
tax
revenue. But it is
not how the credit provision was envisioned when the impact fee law was created in 1986.
The Executive now recommends revising the law to reflect the whole cost incurred in
building or widening a road that adds capacity, rather than a pro-rata share. This has also been
incorporated in the revised Executive regulation under review by the T&E Committee.
Earlier testimony.
As noted above, the provisions of this bill are part of Bill 34-15, for
which a hearing was held on July 21, 2015. The only testimony at that hearing on these provisions
was from Elm Street Development (©12-13). Elm Street supports both provisions.
Council staff recommendation: Approve Expedited Bill
47-15
with the amendment to
Section 52-93(g), above.
3
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This packet contains:
Memo from County Executive
Expedited Bill 47-15
Legislative Request Report
Fiscal and Economic Impact Statements
Testimony from Elm Street Development
Credits certified and used 2004-2015
Expedited Bill 47-15 as revised by the GO Committee
F:\ORLJN\FY 16\Gofp\BiIl 47-IS\ISI20&c.Doox
Circle
#
1-2
3-5
6-7
8-11
12-13
14
15-17
4
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2:
0 I
OFFICE OF THE COUNTY EXECUTIVE
ROCKVILLE, MARYLAND 20850
lsiah Leggett
County Executive
MONTGOMERY COUNTY
CflUNCIL
MEMORANDUM
RECEIVED
November 10, 2015
TO:
George Leventhal, President
Montgomery County Council
Isiah Leggett, County Executive
/1f1t'-#.j .
FROM:
SUBJECT:
.
/-
L
/l,erJ;,.;~ (4C1i~
Expedited Bill No. XX-IS, Amendments to Montgomery County Code
Chapter 52, Taxation, Sections 52-55 and 52-58
The purpose of this memorandum is to transmit, for the County Council's
approval, Expedited Bill No. XX-15, Amendments to Chapter 52 of the Montgomery
County Code that relates to the Development Impact Tax for Transportation
Improvements. Executive Regulation 26-13 was transmitted to the Council on June 4,
2014 with the purpose of proposing revisions to the Executive Regulations for
Development Impact Tax for Transportation. The purpose of thisregulation
was
to
(l)
allow the Greenway Trail in Clarksburg to be eligible for an Impact Tax credit (which
was a condition of the agreement for the Clarksburg Roads settlement); (2) clarify
language related to credits for park-and-ride lots; and (3) add language for Bikesharing
sites to be eligible for credits.
Council
staff
recommended, and the T &E Committee agreed at the July
28,2014 T&E Committee meeting, that other sections of the Regulations be revised to
existing road is being
provide credits for the full cost of an improvement where
realigned or expanded, as opposed to just the pro-rata share for the highway capacity
added by the newly constructed lanes (Le., developers do not currently receive an impact
tax
credit for reconstructing the existing portion of the road). Following consultation with
the Office of the County Attorney it
was
determined that the best plan of action would be
to amend the County Code to reflect the Council's desire to change the approach by
which credits are certified.
an
As
a result, revisions to Sections 52-55 and 52-58 of the County Code are
proposed to respond to two additional areas of concern beyond the changes proposed
in
Executive Regulation 26-13.
CD
montgomerycountymd.goY/311
3~
240-773-3556 ITY
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George Leventhal
November 10, 2015
Page 2
Section 52-55 of the Code is proposed to be amended to provide a credit
life of 12 years for any new credit certified as of a specific date. Currently, the Code
states that transportation impact
tax
credits have a life of 6 years. This reflects a
compromise between the existing 6-year life and a previously proposed increase to 20 .
years.
Section 52-58 is also being amended and stems from a proposed change in
the way the law has been applied. Under the proposed change to this section, in
determining the amount of a credit for an expansion in the number of lanes that adds new
highway capacity, the cost associated with reconstruction of the existing lanes can be
factored into the overall calculation of the credit amount. The law has been consistently
applied so that only the costs associated with "new" capacity are eligible for a credit.
In
this manner, the cost of providing new lanes was eligible but the cost of reconstructing.
improving and/or realigning the existing road was not eligible. Under this proposed
amendment, the costs associated with reconstructing the existing and constructing the
new lanes would
eligible
for
a credit in that they all would be considered part of the
cost of making the eligible transportation improvement.
be
Executive Regulation 26-13AMII remains with the Council for fmal
action, and reflects language to ensure consistency between it and the proposed code
amendments.
The amendments are transmitted for the Council's review and
consideration. Please direct any questions to Emil Wolanin, Acting Deputy Director of
the Department of Transportation at
240-~77-8788
..
AR:dm
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Bill No.
Bill XX-15
Concerning: Taxes -
Transportation
Impact Tax - Amendments
Revised: [datel
Draft No.
Introduced:
_~[d~at=::::.ell--
_ _ _ __
Expires:
[18
mos. after intro]
Enacted:
[datel
Executive:
[date signed]
Effective:
[date takes effect]
Sunset Date: [date expires]
Ch.
~
Laws of Mont Co.
[Year]
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By:
AN ACT
to:
(1)
(2)
(3)
limit the life ofa credit certified
after
January
1, 2016 to 12
years;
allow a credit for reconstruction of an existing road; and
generally amend County law regarding impact taxes.
By amending
Montgomery County Code
Chapter 52,
Taxation
Sections 52-55 and 52-58
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * '*
Heading or defined term.
Addedto existing law
by
original bill.
Deletedfrom existing
law
by
original bill.
Added
by
amendment.
Deletedfrom existing law or the bill
by
amendment.
Existing law WIt1jfected
by
bilL
The County Council for Montgomery County, Maryland approves the following Act:
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BILL No. [CUCK - TYPE
NUMBER]
1
2
3
4
5
6
Sec. 1. Sections 52-55 and 52-58 are amended as follows:
Sec. 52-55. Credits.
(b)
A property owner must receive credit for constructing or contributing to
an improvement ofthe
type
listed in Section '52-58 ifthe improvement
reduces traffic demand or provides additional transportation capacity.
However, the Department must not certify a credit for any improvement
in the right-of-way of a State road, except a transit or trip reduction
program that operates on or relieves traffic on a State road or an
improvement to a State road that is included in a memorandum of
understanding between the County and either Rockville or
Gaithersburg.
7
8
9
10
11
12
*
*
*
13
14
(4) Any credit that was certified under this subsection on or after
March 1, 2004, and before December 31, 2015, expires 6 years
after the Department certifies the credit. Any credit that was
certified under this subsection on or after
J
anumy
L
2016, expires
12 years after the Department certifies the credit.
15
16
17
18
19
20
21
22
*
*
*
Sec. 52-58. Use of
impact
tax funds.
Impact
tax
funds may be used for" any:
(a)
New
ro~
[or] widening of an existing
ro~
or total reconstruction of
all or part of an existing road required as part ofwidening ofan existing
road, that
adds
highway or intersection capacity or improves transit
service or bicycle commuting, such as bus lanes or bike lanes.
23
24
25
* *
*
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BILL
No.
[CLICK -
TYPE NUMBER]
26
27
Approved:
George Leventhal, President, County Council
Date
28
29
Approved:
Isiah Leggett, County Executive
30
Date
This is a correct copy ofCouncil action.
31
Linda M. Lauer, Clerk ofthe Council
Date
APPROVED AS TO FORM AND
I!GAIJTY
~~UNTY
ATTORNEY
DATE:'
L1'-
tC-;Y;-­
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LEGISLATIVE REQUEST REPORT
BillXX-15
I.
Description: Amendments to Chapter 52 of the Montgomery County Code and .
Corresponding Executive Regulation that relates
to
the Development Impact Tax for
Transportation Improvements. Revisions
to
the County Code are the result of requests
by Council
to
change the approach by which credits are certified,
and
extend the life
of a credit from its existing 6 years to 12 years. Amendments to the Executive
Regulation provide guidance and clarification in interpreting the law with respect to
the certification of impact
tax
credits for transportation.
Problem: Historically, credits have been certified for the cost of improvements that
meet the intent of the code by providing new transportation capacity.
As
a result, the
cost of replacing or improving existing lanes in order to add new or additional lanes
(i.e. 2-lanes to 4 lanes) were not eligible for a credit while the cost ofproviding the
two new lanes would be eligible. The Council requested that the code be modified
so that a credit can be certified for the total cost of the improvement. This explains
the proposed change to Chapter 52-58 of the County Code. Chapter 52-55 is also
being modified in this proposed amendment That modification allows that any new
credit certified after a date specific
will
have a 12-year credit life. The current law
provides for a 6-year credit life.
Goals
and
Objectives: A primary goal ofthe Executive Regulation is to provide
clarification and guidance as
to
the interpretation of the County Code.
Coordination: Following the T&E Committee meeting on Executive Regulation 26­
13 in the summer of 2014, the Office of the County Attorney recommended that the
best way to accommodate the request of the Council was to amend the County Code
and then ens1.,tre consistency to the Executive Regulation.
In
a coordinatiye effort the
Department ofTransportation worked with the County Attorney to develop the·
revisions to the County Code and Executive Regulation.
Fiscal Impact: The only fiscal impact resulting from the proposed amendment is a
potential reduction in the amount ofimpact tax revenue that is collected. This is a
result ofmodifying
what
is considered to
be
eligible for a credit in cases where an
existing roadway is being improved and expanded to create new capacity. By
making the cost of the
full
improvement eligible for a credit, the amount of the credit
can be higher. Since the credit is used in lieu of paying impact tax, the fiscal impact
would be less
tax
collected, thereby reducing the revenue to
be
collected and having
less revenue available for traIisportation improvements.
.
II.
III.
IV.
V.
VI.
Economic Impact: There is no direct economic impact resulting from the proposed
changes to the Code and Executive Regulation.
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VII.
Evaluation of the Results of the Proposed Law: The proposed changes to the County
Code would result
in
extending the life of a credit from 6 to 12 years, and under
certain conditions to expand the amount of a credit to include the cost ofimproving
the existing roadway as well as constructing new lanes.
Vill.
Experience Elsewhere:
IX.
Sources of Information:
x.
Application
within
MUnicipalities: Chapter 52 is applicable to the municipalities of
Rockville and Gaithersburg as well as the remainder of the county.
XI.
Penalties:
I:\Forrns\LEGISLATlVE REQUEST REPORT.doc
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Fiscal Impact Statement
BillXX~IS
Taxes - Transportation Impact Tax - Amendments
1. Legislative Bill Summary
The proposed amendments
to
Chapter 52 ofthe Montgomery County Code relate
to
the
Development Impact Tax for Transportation Improvements. Revisions
to
the County
Code
are
the result ofrequests by Council
to
change the approach by which impact
tax
credits are certified and to extend the life ofa credit
from
its existing
6
years
to 12
years.
2.
An
estimate of changes
in
County' revenues and expenditures regardless ofwhether
the revenues or expenditures are assumed
in
the recommended or approved budget.
Includes source of information, assumptions, and methodologies used.
The proposed bill does not directly impact County revenues and expenditures
at
this time.
The proposed bill changes the method ofcalculation ofimpact
tax
credits for eligible
capital projects.
It
is
difficult to estimate which capital projects
are
eligible or how large
the impact
tax
credit
to
a developer is;
tax
credits
are
determined by the developer's costs
in
constructing
the improvement (in lieu ofpaying the
imp~
tax).
Any increase in the impact
tax
credit would result
in
a decrease in impact
tax
revenues
to
the County; this change is difficult
to
quantify until the eligible improvement
and
amount
ofthe credit
is
identified.
3. Revenue and expenditure estimates covering at least the next 6 fiscal years.
See
item
#2
above.
4.
An
actuarial analysis through the entire amortization period for each regulation
that would affect retiree pension or group
insuran~
costs.
Not Applicable.
s.
Later actions that may affect future revenue and expenditures
if
the regulation
authorizes future spending.
None.
6.
An
estimate of the staff time needed to implement the regulation and/or Code.
The
staff
time needed
to
implement the Code modifications does not change; the
proposed bill provides clarification
as
to
what is required
in
order for
an
impact
tax
credit
to be certified.
7.
An
explanation of how the addition of new staff responsibilities would affect other
duties.
The proposed bill does not create new
staff
responsibilities.
8.
An
estimate of costs when an additional appropriation is needed.
Not Applicable.
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9. A description of any variable that could affect revenue
~d
cost estimates.
The number of eligible capital improvements and the size ofthe impact
tax
credit are the
primary,
variables which could affect revenue and cost estimates for the proposed bill.
10. Ranges of revenue or expenditures that are uncertain or difficult to project
Changes
in
impact
tax
revenues are difficult to project as the number of credit-eligible
projects and the size ofthe credit is unknown.
11.
If
a regulation or revision to the County Code
is
likely to have no
fiscal
impact, why
that
is
the case.
The proposed regulation serves the purpose ofproviding clarification, guidance, and
direction as
to
what requirements must be met
in
order for an impact tax credit
to
be
certified· for
certain
specific types ofimprovements (hiker-biker
trail,
transit center, park­
and-ride, and bikesharing).
It
also
provides guidance
in
determining the amount ofa
credit to
be
certified for these improvements.
Current County laws and regulations state
that
adding only
new
roadway capacity (i.e.,
adding a new lane) was eligible for impact
tax credit
The proposed bill revises current
law such
that
improvements
to
existing
lanes are eligible for credits, resulting in larger
credit than in the past Since the credit is used in lieu ofpaying impact
tax,
the
fiscal
impact would
be
that less impact
tax
revenues are collected.
12. Other
fiscal
impacts or comments•
.
None.
Emil Wolanin, Department of Transportation
David Moss, Department of Transportation
Scott Foncannon, Office of County Attorney
Brady Goldsmith, Office ofManagement and Budget
13. The following contributed to
this
analysis:
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Economic Impact Statement
Bill
##-15, Concerning Taxes -Transportation Impact Tax -Amendments
Background:
This legislation would limit the life of an impact
tax
credit certified after January I,
2016
to
12
years, and allow a credit for reconstruction of an existing road.
Bill
##-15
amends Section
52-55
ofthe County Code by providing any new credit certified
on or
after
January
1,2016
will have a twelve year life. The Code currently states that any
credit certified after March
1, 2004,
has
a six year life.
1. The sources ofinformation, assumptions, and methodologies used.
Sources of information include the Department ofTransportation
(DOn
and the
Department ofPermitting Services (DPS). According to data provided by DPS, the
amount ofunused credits outstanding is
$45.5
million from transactions between April
30,2008,
and April
30,2015.
Since specific data on the start ofthe transaction is not
available, the Department ofFinance assumes that the amount ofcredit available is an
average of approximately
$6.5
million per year. Using this assumption and the
first
transaction period occurring between April
30,2008,
and April
29,2009,
the first set of
credits under the six year limit has expired with the remaining
$39.0
million of available
credits remaining under the current six-year·limit Given the assumption of the
$6.5
million average credit available per year, the remaining credit amount will expire by
2021.
Since it is uncertain what the amount of credits are that
will
be available starting on
January
1,2016
the twelve-year time life, the economic impact on the developers' impact
tax liability and business income cannot be estimated with any specificity.
2.
A
description of any variable that could affect the economic impact estimates.
The
variable
that
could
affect the economic impact estimates attributed to Bill
##-15
is the
amount of credits available starting with the transaction date of January 1,
2016
and a·
credit life of twelve years. Certainly by extending the life ofthe credit from six to twelve
years, it
will
have some economic impaCt on business revenues but that impact is
dependent on the number of development projects and the costs of such projects incurred
by developers over the twelve year period and whether such extension will encourage
more development Since that information is not available on specific future development,
it is uncertain with any specificity what the economic impact on business revenue,
investment, and property values
will
be.
3. The Bill's positive or negative effect,
if
any on employment, spending, savings,
investment, incomes, and property values.in the County.
Bill
##-15
could have apositive economic effect on business revenue and income, but
without specific data as stated in paragraph #2, it is uncertain with any specificity what the
amount of
that
impact
will
be. By extending the life of the credit, Bill
##-15
could delay
.
(;6)
P~H-
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Economic Impact Statement
Bill ##-15, Concerning Taxes -Transportation Impact Tax -Amendments
annual project development by spreading such development over a twelve-year rather than a
six-year period
and
have an effect on short-term business income, investment, and property
values but would not have a long-term effect
4. H
a Bill
is
likely to have no economic impact, why
is
that the case?
Please
seeparagrap~
#3.
5. The following contributed to or concurred with this analysis: David Platt and Rob
Hagedoom, Department ofFinance;
and
David Moss, Department ofTransportation.
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July 21, 2015
Bill 34-15 Testimony
My name is Kate Kubit and I work at Elm Street Development. Thank you for the opportunity to
speak today. Elm Street Development has been developing in Montgomery County for over 35 years
and in Clarksburg for over 25 years. Today, I am here on behalf of two of our active development
entities in Clarksburg: Third Try, LC, which is the developer of the reminder of Clarksburg Town Center,
and Clarksburg Village Investments, Inc., which is the developer of Clarksburg Village, to support two
specific components of Bill 34-15.
We Support a 12 Year Validity Period for Transportation Impact Tax Credits
First and foremost, we strongly support the proposed extension of the transportation impact tax
credit validity period to 12 years. Since Clarksburg Village Investments,
In~.
started development in
Clarksburg Village in 2003, we have constructed tens of millions of dollar of Master Planned Roads. Our
experience is that a six year shelf life for transportation impact tax credits is simply not enough time to
ensure the use of transportation impact tax credits generated by the construction of Master Plan roads
unless this construction is phased into many segments. This financial constraint results in a less
desirable transportation situation during a multiyear build out. Often times in Clarksburg Village, we
managed a delicate balance between constructing Master Plan Roadways and the reality that
tra nsportation impact tax credits to pay for these roads expired in six years. A 12 year lifespan of these
credits would provide necessary assurances to facilitate the earlier construction of key infrastructure in
larger communities.
Across the street at Clarksburg Town Center, Third Try, LC does not have the lUXUry to manage
the timing of Master Plan Roadway construction within six years of the predicted use of transportation
impact tax credits. Instead, over the next 3
X
years, we will need to spend over $7,000,000 to
contribute to the design and construction of two Master Planned Roads that serve Clarksburg Town
Center and the surrounding community: Stringtown Road and Clarksburg Road. We will start to spend
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July 21, 2015
Bill
34-15 Testimony
this money before we are able to use any transportation impact tax credits. In addition, we will spend
all of this $7,000,000 before we come close
to
recouping it through transportation impact tax credits.
Given the importance of these roads, we are prepared to invest the $7,000,000, but absolutely need the
12 year extension to help ensure the use of the transportation impact tax credits generated by our
investment. The current time limit of six years for impact tax credits is simply too short of a validity
period to justify our investment.
We Support the Use of Impact Tax Credits to Improve Existing Roads
We also strongly support the ability to receive transportation impact tax credit for the
reconstruction of existing roads, as provided for in Bill 34-15. Often times, existing roads are
reconstructed along with the construction of new infrastructure, which collectively creates additional
capacity to these roads. These upgrades to the existing roadway also make the roads safer for
pedestrians, bikes and cars. In addition, roadway reconstruction is typically more expensive to build
than roads that are completely new. Given this, all capacity-adding reconstruction to Master Plan
Roads, even updates to existing infrastructure, should be eligible to receive impact tax credits for all of
the costs to reconstruct and build these roadways.
Thank you for your time.
®
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Expedited Bill No.
Bill 47-15
Concerning: Taxes -
Transoortation
Impact Tax - Revisions
Draft No.
~
Revised: 121212015
Introduced:
November 17. 2015
Expires:
May 17. 2017
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: -:----:-:-_ _ _ _ _ __
Sunset Date: -'N:..:.;o=.n=e_ _ _ _ __
ChI
Laws of Mont Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
Lead Sponsor: Council President at the Request of the County Executive
AN EXPEDITED ACT
to:
(1)
revise the life of a credit certified after a certain date for transportation and school
(2)
(3)
impact taxes;
allow a transportation impact tax credit for reconstruction ofan existing road; and
generally amend County law regarding impact taxes.
By amending
Montgomery County Code
Chapter 52, Taxation
Sections 52-55! [[and]] 52-58, and 52-93
Boldface
Underlining
[Single boldface brackets]
Double undedining
[[Double boldface bracketsD
* * *
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 unqffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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EXPEDITED BILL
No. 47-15
1
Sec.
I.
Sections
52-55~
[[and]] 52-58. and 52-93 are amended as follows:
52-55. Credits.
(b)
A property owner must receive credit for constructing or contributing to
an improvement of the type listed in Section 52-58 if the improvement
reduces traffic demand or provides additional transportation capacity.
However, the Department must not certify a credit for any improvement
in the right-of-way of a State road, except a transit or trip reduction
program that operates on or relieves traffic on a State road or an
improvement to a State road that is included in a memorandum of
understanding between the County and either Rockville or Gaithersburg.
2
3
4
5
6
7
8
9
10
11
*
(4)
*
*
12
13
14
15
Any credit that was certified under this subsection on or after
March 1, 2004, and before December 31, 2015, expires 6 years
after the Department certifies the credit. Any credit that was
certified under this subsection on or after January.L. 2016, expires
12 years after the Department certifies the credit.
16
17
*
52-58. Use of impact tax funds.
*
*
18
19
20
Impact tax funds may be used for any:
(
a)
new road.1 [or] widening of an existing road.1 or total reconstruction of all
or part ofan existing road required as part ofwidening ofan existing road,
that adds highway or intersection capacity or improves transit service or
bicycle commuting, such as bus lanes or bike lanes.
21
22
23
24
25
26
*
52-93. Credits.
*
*
*
*
*
®
-2­
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EXPEDITED BILL
No.
47-15
27
28
(g)
Any credit issued under this Section before December 31, 2015 expires 6
years after the Director certifies the credit. Any credit issued under this
Section on or after
January
1.
2016 expires 12 years after the Director
certifies the credit.
29
30
31
Sec. 2. Expedited Effective Date.
The Council declares that this legislation is necessary for the immediate protection of
the public interest. This Act takes effect on the date on which
it
becomes law.
Approved:
32
33
34
35
Nancy Floreen, President, County Council
Date
36
37
Approved:
Isiah Leggett, County Executive
Date
38
39
This is a correct copy o/Council action.
Linda
M.
Lauer, Clerk ofthe Council
Date
@
-3­