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Chairman Phil Mendelson 2
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A BILL 8
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IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 12
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To amend, on an emergency basis, Title 47 of the DC Official Code to provide for more timely 16
classification changes for commercial properties that are to be put to residential use; to 17
provide for an application process to make classification changes; to provide for appeal 18
rights if such application is denied; and to provide for a claw back in the event the real 19
property is not timely put to residential use. 20
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BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 22
act may be cited as the “Residential Building Permit Classification Emergency Amendment Act 23
of 2025”. 24
Sec. 2. Section 47-813 of the District of Columbia Official Code is amended to read as 25
follows: 26
(a) Subsection (c-9)(2) is amended as follows: 27
(1) Subparagraph (A) is amended to read as follows: 28
“(A) Except as otherwise provided in this paragraph and subject to 29
paragraphs (4) and (5) of this subsection, Class 1A Property shall be comprised of: 30
“(i) Residential real property that is improved and its legal use is 31
for nontransient residential dwelling purposes, and that is not Class 1B Property; provided, that 32 2
such property may be used to host transient guests pursuant to an unexpired short-term rental 33
license endorsement issued pursuant to § 30-201.04; or 34
“(ii) Real property or a portion of real property for which a 35
building permit has been issued: 36
“(I) To construct a new improvement for predominantly 37
nontransient residential dwelling purpose; or 38
“(II) To substantially rehabilitate that portion or all of an 39
existing improvement for exclusively nontransient residential dwelling purposes.”. 40
(2) Subparagraph (C) is amended by striking the phrase “designated as” and 41
inserting the phrase “designated solely as” in its place. 42
(b) The lead-in language of subsection (d-2) is amended by striking the phrase “Class 3 43
Property or Class 4 Property,” and inserting the phrase “Class 2 Property, Class 3 Property, or 44
Class 4 Property,” in its place. 45
(c) A new subsection (d-3) is added to read as follows: 46
“(d-3)(1) If real property changes classification to Class 1A Property as defined in 47
subsection (c-9)(2)(A)(ii) during the period: 48
“(A) October 1 through March 31 of the tax year, the newly reclassified 49
Class 1A Property, or the portion thereof used exclusively for residential purposes if already 50
improved or assessed under § 47-829, shall be taxed at the Class 1A Property tax rate for the 51
entire tax year; or 52
“(B) April 1 through September 30 of the tax year, the newly reclassified 53
Class 1A Property, or the portion thereof used exclusively for residential purposes if already 54 3
improved or assessed under § 47-829, shall be taxed at the Class 1A Property tax rate for the 55
second installment only. 56
“(2) The owner shall apply for a change of classification to Class 1A Property as 57
defined in subsection (c-9)(2)(A)(ii) of this section and shall promptly provide complete 58
documentation in a manner prescribed by the Chief Financial Officer to substantiate any such 59
classification change before it shall be effective. 60
“(3) A change in classification to Class 1A Property as defined in subsection (c-61
9)(2)(A)(ii) of this section shall be effective beginning in the half tax year for which application 62
is made under paragraph (2) of this subsection. 63
“(4) If change in classification to Class 1A Property as defined in subsection (c-64
9)(2)(A)(ii) of this section is determined to be erroneous because the real property was not put to 65
predominantly residential use by the earlier of either the issuance of any new or amended 66
certificate of occupancy (temporary or permanent) for any part of the improvement thereon, or 3 67
years from issuance of the building permit, or the building permit expired and was not renewed 68
within 1 year, the Chief Financial Officer shall reclassify and tax the real property without 69
limitation for each tax year or half tax year in which the real property was improperly classified 70
as Class 1A Property, subject only to subsection (d-1)(5)(A-i) of this section if the property is 71
determined to be Class 3 Property or Class 4 Property, or subsection (d-2) of this section. In the 72
event of such reclassification, penalty and interest shall be added beginning from the day the 73
correct amount of tax should have been due but not paid if the property had been properly 74
classified. 75
“(5) Within 45 days from the date of the notice of denial of Class 1A Property 76
reclassification under this paragraph of this subsection, the owner may petition for an 77 4
administrative review of the rescission or denial and appeal from a final determination thereof to 78
the same extent as if the appeal were filed under § 47-825.01a(d)(2). 79
“(6) Notwithstanding the time limitations in paragraphs (4) and (5) of this 80
paragraph, the Chief Financial Officer, in his or her discretion, may grant an extension of time to 81
comply or waive penalty and interest assessed pursuant to paragraph (4) of this subsection to 82
prevent an undue hardship to the owner. 83
“(7) The provisions of this subsection, subsection (c-9)(2)(A)(ii) of this section, 84
and § 47-829 shall not supersede the requirement to timely file for mixed-use classification for 85
the upcoming tax year pursuant to subsection (f) of this section, when the annual assessment for 86
such upcoming tax year is made under § 47-824 and the certificate of occupancy (final or 87
temporary) was issued.”. 88
Sec. 3. Applicability. 89
This act shall apply as of April 1, 2025. 90
Sec. 4. Fiscal impact statement. 91
The Council adopts the fiscal impact statement of the Budget Director as the fiscal impact 92
statement required by section 4a of the General Legislative Procedures Act of 1975, approved 93
October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 94
Sec. 5. Effective date. 95
This act shall take effect following approval by the Mayor (or in the event of veto by the 96
Mayor, action by the Council to override the veto), and shall remain in effect for no longer than 97
90 days, as provided for emergency acts of the Council of the District of Columbia in section 98
412(a) of the District of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 788; 99
D.C. Official Code § 1-204.12(a)). 100