EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0027*
HOUSE BILL 27
Q3 2lr0317
(PRE–FILED) CF 2lr1284
By: Delegates Luedtke and Smith
Requested: June 25, 2021
Introduced and read first time: January 12, 2022
Assigned to: Ways and Means
A BILL ENTITLED
AN ACT concerning 1
Historic Revitalization Tax Credit – Funding and Extension 2
FOR the purpose of establishing the Small Commercial Project Trust Account within the 3
Historic Revitalization Tax Credit Reserve Fund; requiring the Governor, in certain 4
fiscal years, to include in the annual State budget an appropriation of at least a 5
certain amount for the Reserve Fund and the Trust Account; altering the aggregate 6
amount of initial tax credit certificates that may be issued for small commercial 7
projects; extending for a certain number of years the termination date of the tax 8
credit; and generally relating to the historic revitalization tax credit. 9
BY repealing and reenacting, with amendments, 10
Article – State Finance and Procurement 11
Section 5A–303(d), (e), and (j) 12
Annotated Code of Maryland 13
(2021 Replacement Volume) 14
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 15
That the Laws of Maryland read as follows: 16
Article – State Finance and Procurement 17
5A–303. 18
(d) (1) (I) In this subsection[,] THE FOLLOWING WORDS HAVE THE 19
MEANINGS INDICATED . 20
(II) “Reserve Fund” means the Historic Revitalization Tax Credit 21
Reserve Fund established under paragraph (2) of this subsection. 22
2 HOUSE BILL 27
(III) “TRUST ACCOUNT” MEANS THE SMALL COMMERCIAL 1
PROJECT TRUST ACCOUNT ESTABLISHED UNDER PA RAGRAPH (4) OF THIS 2
SUBSECTION. 3
(2) (i) There is a Historic Revitalization Tax Credit Reserve Fund that 4
is a continuing, nonlapsing special fund that is not subject to § 7–302 of this article. 5
(ii) The money in the Fund shall be invested and reinvested by the 6
Treasurer, and interest and earnings shall be credited to the General Fund. 7
(iii) If the fees paid in any fiscal year are less than the directly related 8
administrative costs of operating the Historic Revitalization Tax Credit Program, funds in 9
the Reserve Fund shall be used for the directly related administrative costs of the Program. 10
(3) (i) Subject to the provisions of this subsection, the Director shall 11
issue an initial credit certificate for each commercial rehabilitation for which a plan of 12
proposed rehabilitation is approved and the fees charged under subsection (b)(7)(i) of this 13
section are paid. 14
(ii) An initial credit certificate issued under this subsection shall 15
state the maximum amount of credit under this section for which the commercial 16
rehabilitation may qualify. 17
(iii) 1. Except as otherwise provided in this subparagraph and in 18
subsection (b)(7)(v) of this section, for any fiscal year, the Director may not issue initial 19
credit certificates for credit amounts in the aggregate totaling more than the amount 20
appropriated to the Reserve Fund for that fiscal year in the State budget as approved by 21
the General Assembly. 22
2. If the aggregate credit amounts under initial credit 23
certificates issued in a fiscal year total less than the amount appropriated to the Reserve 24
Fund for that fiscal year as a result of the limitation under subsection (b)(6) of this section, 25
any excess amount may be issued under initial credit certificates for projects in a county or 26
Baltimore City in the same fiscal year, without regard to the limitation under subsection 27
(b)(6) of this section. 28
3. Subject to subsubparagraph 2 of this subparagraph, if the 29
aggregate credit amounts under initial credit certificates issued in a fiscal year total less 30
than the amount appropriated to the Reserve Fund for that fiscal year, any excess amount 31
shall remain in the Reserve Fund and may be issued under initial credit certificates for the 32
next fiscal year. 33
4. For any fiscal year, if funds are transferred from the 34
Reserve Fund under the authority of any provision of law other than paragraph [(4)] (5) of 35
this subsection, the maximum credit amounts in the aggregate for which the Director may 36
issue initial credit certificates shall be reduced by the amount transferred. 37
HOUSE BILL 27 3
5. In each fiscal year, the Director shall estimate the amount 1
of fees to be collected based on the amount appropriated to the Reserve Fund and reserve 2
the difference between the estimated fees and estimated directly related administrative 3
costs of the Program to be used to administer the Program. 4
6. If the reservation of funds to administer the Program 5
under subsubparagraph 5 of this subparagraph is not necessary to cover the directly related 6
administrative costs of the Program, any excess amount shall remain in the Reserve Fund 7
and may be issued under initial credit certificates for the next fiscal year. 8
(iv) 1. Subject to [subsubparagraph 2] SUBSUBPARAGRAPHS 2 9
THROUGH 5 of this subparagraph, for each of fiscal years 2018 through [2024] 2031, the 10
Governor shall include in the budget bill an appropriation to the Reserve Fund. 11
2. For each of fiscal years 2023 and 2024, the Governor shall 12
include in the budget bill an appropriation to the Reserve Fund of at least $12,000,000. 13
3. FOR EACH OF FISCAL YE ARS 2025 AND 2026, THE 14
GOVERNOR SHALL INCLUD E IN THE BUDGET BILL AN APPROP RIATION TO THE 15
RESERVE FUND OF AT LEAST $24,000,000. 16
4. FOR EACH OF FISCAL YE ARS 2027 THROUGH 2031, 17
THE GOVERNOR SHALL INCLUD E IN THE BUDGET BILL AN APPROPRIATION TO THE 18
RESERVE FUND OF AT LEAST $36,000,000. 19
5. THE AMOUNTS DES CRIBED UNDER 20
SUBSUBPARAGRAPHS 2 THROUGH 4 OF THIS SUBPARAGRAPH SHALL BE IN ADDITION 21
TO THE APPROPRIATION S TO THE TRUST ACCOUNT REQUIRED UNDER PARAG RAPH 22
(4) OF THIS SUBSECTION . 23
(v) Notwithstanding the provisions of § 7–213 of this article, the 24
Governor may not reduce an appropriation for the Reserve Fund in the State budget as 25
approved by the General Assembly. 26
(vi) The Director may not issue an initial credit certificate for any 27
fiscal year after fiscal year [2024] 2031. 28
(4) (I) WITHIN THE RESERVE FUND, THERE IS A SMALL 29
COMMERCIAL PROJECT TRUST ACCOUNT. 30
(II) 1. THE TRUST ACCOUNT IS ESTABLISHE D FOR THE 31
ISSUANCE OF TAX CRED IT CERTIFICATES FOR SMALL COMMERCIAL PRO JECTS. 32
2. FUNDS IN THE TRUST ACCOUNT SHALL BE USED 33
ONLY FOR TRANSFERS FROM T HE RESERVE FUND TO THE GENERAL FUND IN 34 4 HOUSE BILL 27
ACCORDANCE WITH PARA GRAPH (5) OF THIS SUBSECTION W ITH RESPECT TO TAX 1
CREDIT CERTIFICATES ISSUED FOR SMALL COM MERCIAL PROJECTS . 2
(III) THE TRUST ACCOUNT CONSISTS OF : 3
1. MONEY APPROPRIATED I N THE STATE BUDGET FOR 4
THE TRUST ACCOUNT; AND 5
2. ANY OTHER MONEY FROM ANY OTHER SOURCE 6
ACCEPTED FOR THE BEN EFIT OF THE TRUST ACCOUNT. 7
(IV) FOR EACH OF FISCAL YEAR S 2024 THROUGH 2031, THE 8
GOVERNOR SHALL INCLUD E IN THE BUDGET BILL AN APPROPRIATION TO THE 9
TRUST ACCOUNT OF AT LEAST $4,000,000. 10
[(4)] (5) (i) Except as provided in this paragraph, money appropriated 11
to the Reserve Fund shall remain in the Fund. 12
(ii) 1. Within 15 days after the end of each calendar quarter, the 13
Trust shall notify the Comptroller as to each commercial rehabilitation completed and 14
certified during the quarter: 15
A. the maximum credit amount stated in the initial credit 16
certificate for the project; and 17
B. the final certified credit amount for the project. 18
2. On notification that a project has been certified, the 19
Comptroller shall transfer an amount equal to the maximum credit amount stated in the 20
initial credit certificate for the project from the Reserve Fund to the General Fund. 21
(iii) 1. On or before October 1 of each year, the Trust shall notify 22
the Comptroller as to the maximum credit amount stated in the initial credit certificate for 23
each commercial rehabilitation for which the initial credit certificate has expired under 24
subsection (c)(3) of this section as of the end of the prior fiscal year. 25
2. On notification that the initial credit certificate for a 26
project has expired under subsection (c)(3) of this section, the Comptroller shall transfer an 27
amount equal to the maximum credit amount stated in the initial credit certificate for the 28
project from the Reserve Fund to the General Fund. 29
(e) (1) Subject to the provisions of this subsection, the Director shall issue an 30
initial credit certificate for each approved small commercial project on a first–come, 31
first–served basis. 32
(2) An initial credit certificate issued under this subsection shall state the 33 HOUSE BILL 27 5
maximum amount of tax credit for which the applicant is eligible. 1
(3) (i) [The] BEFORE FISCAL YEAR 2024, THE Director may not issue 2
an initial credit certificate under this subsection after the aggregate amount of initial credit 3
certificates issued for small commercial projects totals $5,000,000. 4
(ii) [For] BEFORE FISCAL YEAR 2024, FOR a targeted project, the 5
Director may not issue an initial credit certificate under this subsection: 6
1. after the aggregate amount of initial credit certificates 7
issued for agricultural structures totals $1,000,000; or 8
2. after the aggregate amount of initial credit certificates 9
issued for post–World War II structures totals $1,000,000. 10
(III) BEGINNING FISCAL YEAR 2024 AND EACH FISCAL YEAR 11
THEREAFTER , THE DIRECTOR MAY NOT ISSU E INITIAL CREDIT CER TIFICATES FOR 12
SMALL COMMERCIAL PRO JECTS UNDER THIS SUB SECTION FOR CREDIT A MOUNTS IN 13
THE AGGREGATE TOTAL ING MORE THAN THE AM OUNT OF FUNDS IN THE SMALL 14
COMMERCIAL PROJECT TRUST ACCOUNT ESTABLISHED UNDER SUBSECTION (D)(4) 15
OF THIS SECTION. 16
(j) (1) Subject to the provisions of this subsection, the provisions of this section 17
and the tax credit authorized under this section shall terminate as of July 1, [2024] 2031. 18
(2) On and after July 1, [2024] 2031: 19
(i) the tax credit authorized under this section may be claimed for: 20
1. a rehabilitation project, other than a commercial 21
rehabilitation, for which an application for approval of a plan of proposed rehabilitation 22
was received by the Director on or before June 30, [2024] 2031; or 23
2. a commercial rehabilitation for which an initial credit 24
certificate has been awarded under subsection (d) of this section; and 25
(ii) the Director shall continue to report to the Governor and the 26
General Assembly as required under subsection (i) of this section for as long as any 27
rehabilitation project for which the tax credit may be claimed remains incomplete. 28
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 29
1, 2022. 30