January 18, 2018
January 16, 2018
Government Operations and Fiscal Policy Committee
Jeff Zyo~nior Legislative Analyst
Expedited Bill 36-17, Taxation - Development Impact Tax -
Exemptions - Amendments
Expedited Bill 36-17, Taxation - Development Impact Tax - Exemptions - Amendments,
sponsored by Lead Sponsor Councilmember Floreen, was introduced on October 31, 2017. The
primary goal of Bill 36-17 is to reduce the tax burden on projects that provide at least 25%
affordable housing. The Bill would allow a development that increases the number of dwelling
units previously approved to take advantage of the development tax exemption for projects with
25% affordable housing. As proposed, a development that provides 25% affordable units by
increasing the number of units in proposed development would qualify for the exemption.
A public hearing was held on December 5, 2017 at which a representative of the Sandy Spring
Friend's House spoke in favor of the amendment. The Friend's House recently received a special
exception amendment to increase the number of units on the_property. The speaker indicated the
fact that the number of units being increased distinguished it from other previously approved
projects in the pipeline. A second speaker also supported the Bill but requested an amendment to
exempt "some" previously approved development.
There is a long legislative history on this topic. On December 6, 2011, Bill 39-11, Development
Impact Tax - Exemptions, was introduced to exempt market-rate rental dwelling units in any
development which included at least 25% affordable units from all impacts taxes. That Bill was
brought to the Council with a recommendation to enact with expanding amendments from the GO
Committee. There were signifiant concerns by the Council for the Bill's fiscal impact.
was tabled and expired without enactment on December 1, 2014.
The "cost" of the provision was then calculated as $80,000
lost impact fees collected for each additional MPDU.
study estimate the cost at $76,619 per additional affordable unit;
2013, staff estimated that same
cost to be $81,600
Metro Station Policy Areas and $111,520 outside of those areas where multifamily construction
is less likely.