Maryland 2022 Regular Session

Maryland House Bill HB539 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2
3	3	EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LAW.
4	4	[Brackets] indicate matter deleted from existing law.
5	5	hb0539
6	6
7	7	HOUSE BILL 539
8	8	Q3 2lr1572
9	9
10	10	By: Delegate Carr
11	11	Introduced and read first time: January 21, 2022
12	12	Assigned to: Ways and Means
13	13
14	14	A BILL ENTITLED
15	15
16	16	AN ACT concerning 1
17	17
18	18	Historic Revitalization Tax Credit – Alterations – Qualified Rehabilitation 2
19	19	Expenditures for Single–Family, Owner–Occupied Residences 3
20	20
21	21	FOR the purpose of altering the maximum tax credit amount that individuals may claim 4
22	22	under the historic revitalization tax credit program for certain expenditures for the 5
23	23	rehabilitation of certain single–family, owner–occupied residences; and generally 6
24	24	relating to the historic revitalization tax credit program. 7
25	25
26	26	BY repealing and reenacting, without amendments, 8
27	27	Article – State Finance and Procurement 9
28	28	Section 5A–303(a)(1), (7), (8), and (28) through (30) and (c)(2) 10
29	29	Annotated Code of Maryland 11
30	30	(2021 Replacement Volume) 12
31	31
32	32	BY repealing and reenacting, with amendments, 13
33	33	Article – State Finance and Procurement 14
34	34	Section 5A–303(c)(1) 15
35	35	Annotated Code of Maryland 16
36	36	(2021 Replacement Volume) 17
37	37
38	38	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 18
39	39	That the Laws of Maryland read as follows: 19
40	40
41	41	Article – State Finance and Procurement 20
42	42
43	43	5A–303. 21
44	44
45	45	(a) (1) In this section the following words have the meanings indicated. 22
46	46
47	47	(7) “Certified rehabilitation” means a completed rehabilitation of a 23
48	48	certified historic structure that the Director certifies is a substantial rehabilitation in 24 2 HOUSE BILL 539
49	49
50	50
51	51	conformance with the rehabilitation standards of the United States Secretary of the 1
52	52	Interior. 2
53	53
54	54	(8) (i) “Commercial rehabilitation” means a rehabilitation of a 3
55	55	structure other than a single–family, owner–occupied residence. 4
56	56
57	57	(ii) “Commercial rehabilitation” does not include a small commercial 5
58	58	project. 6
59	59
60	60	(28) “Qualified rehabilitation expenditure” means any amount that: 7
61	61
62	62	(i) is properly chargeable to a capital account; 8
63	63
64	64	(ii) is expended in the rehabilitation of a structure that by the end of 9
65	65	the calendar year in which the certified rehabilitation is completed is a certified historic 10
66	66	structure; 11
67	67
68	68	(iii) is expended in compliance with a plan of proposed rehabilitation 12
69	69	that has been approved by the Director; and 13
70	70
71	71	(iv) is not funded, financed, or otherwise reimbursed by any: 14
72	72
73	73	1. State or local grant; 15
74	74
75	75	2. grant made from the proceeds of tax–exempt bonds issued 16
76	76	by the State, a political subdivision of the State, or an instrumentality of the State or of a 17
77	77	political subdivision of the State; 18
78	78
79	79	3. State tax credit other than the tax credit under this 19
80	80	section; or 20
81	81
82	82	4. other financial assistance from the State or a political 21
83	83	subdivision of the State, other than a loan that must be repaid at an interest rate that is 22
84	84	greater than the interest rate on general obligation bonds issued by the State at the most 23
85	85	recent bond sale prior to the time the loan is made. 24
86	86
87	87	(29) (i) “Single–family, owner–occupied residence” means a structure or 25
88	88	a portion of a structure occupied by the owner and the owner’s immediate family as their 26
89	89	primary or secondary residence. 27
90	90
91	91	(ii) “Single–family, owner–occupied residence” includes: 28
92	92
93	93	1. a residential unit in a cooperative project owned by or 29
94	94	leased to a cooperative housing corporation and leased for exclusive occupancy to, and 30
95	95	occupied by, a member of the corporation and the member’s immediate family under a 31
96	96	proprietary lease; 32
97	97	HOUSE BILL 539 3
98	98
99	99
100	100	2. a structure that is described under paragraph (6)(i)5 of 1
101	101	this subsection; and 2
102	102
103	103	3. a small commercial project. 3
104	104
105	105	(30) “Small commercial project” means a rehabilitation of a structure if: 4
106	106
107	107	(i) the qualified rehabilitation expenditures do not exceed $500,000; 5
108	108	and 6
109	109
110	110	(ii) 1. the structure is primarily used for commercial, 7
111	111	income–producing purposes; 8
112	112
113	113	2. the structure: 9
114	114
115	115	A. is a residential unit in a consecutive series of similar 10
116	116	residential units that are arranged in a row, side by side; and 11
117	117
118	118	B. is sold as part of a development project for exclusive 12
119	119	occupancy to, and occupied by, the resident; 13
120	120
121	121	3. the structure is a targeted project; or 14
122	122
123	123	4. the structure is a condominium or cooperative project and 15
124	124	the rehabilitation targets only the common elements of the condominium or cooperative 16
125	125	project. 17
126	126
127	127	(c) (1) (i) Except as otherwise provided in this section, for the taxable year 18
128	128	in which a certified rehabilitation is completed, an individual or business entity may claim 19
129	129	a tax credit in an amount equal to: 20
130	130
131	131	1. 20% of the individual’s or business entity’s qualified 21
132	132	rehabilitation expenditures for [the] A COMMERCIAL rehabilitation OR SMALL 22
133	133	COMMERCIAL PROJECT ; OR 23
134	134
135	135	2. 25% OF THE INDIVIDUAL ’S QUALIFIED 24
136	136	REHABILITATION EXPEN DITURES FOR THE REHA BILITATION OF A SINGLE–FAMILY, 25
137	137	OWNER–OCCUPIED RESIDENCE . 26
138	138
139	139	(ii) For a commercial rehabilitation, an individual or business entity 27
140	140	may claim an additional tax credit in an amount equal to 5% of the individual’s or business 28
141	141	entity’s qualified rehabilitation expenditures if the certified rehabilitation is a certified 29
142	142	historic structure and: 30
143	143
144	144	1. is a high performance building; or 31
145	145	4 HOUSE BILL 539
146	146
147	147
148	148	2. qualifies as affordable housing or a Level 1 opportunity 1
149	149	zone project. 2
150	150
151	151	(iii) For a commercial rehabilitation, a business entity may claim an 3
152	152	additional tax credit in an amount equal to 7.5% of the business entity’s qualified 4
153	153	rehabilitation expenditures if the certified rehabilitation is a certified historic structure 5
154	154	and qualifies as a Level 2 opportunity zone project. 6
155	155
156	156	(2) (i) For any commercial rehabilitation, the State tax credit allowed 7
157	157	under this section may not exceed the lesser of: 8
158	158
159	159	1. A. $3,000,000 for any commercial rehabilitation other 9
160	160	than a Level 1 or Level 2 opportunity zone project; 10
161	161
162	162	B. $3,150,000 for a Level 1 opportunity zone project; or 11
163	163
164	164	C. $3,300,000 for a Level 2 opportunity zone project; or 12
165	165
166	166	2. the maximum amount specified under the initial credit 13
167	167	certificate issued for the rehabilitation. 14
168	168
169	169	(ii) For a rehabilitation other than a commercial rehabilitation, the 15
170	170	State tax credit allowed under this section may not exceed: 16
171	171
172	172	1. $50,000 for a rehabilitation other than a Level 1 or Level 17
173	173	2 opportunity zone project; 18
174	174
175	175	2. $55,000 for a Level 1 opportunity zone project; or 19
176	176
177	177	3. $60,000 for a Level 2 opportunity zone project. 20
178	178
179	179	(iii) For the purposes of the limitation under subparagraph (i) of this 21
180	180	paragraph, the following shall be treated as a single commercial rehabilitation: 22
181	181
182	182	1. the phased rehabilitation of the same structure or 23
183	183	property; or 24
184	184
185	185	2. the separate rehabilitation of different components of the 25
186	186	same structure or property. 26
187	187
188	188	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 27
189	189	1, 2022, and shall be applicable to all taxable years beginning after December 31, 2021. 28