EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0023*
HOUSE BILL 23
Q1 5lr1615
(PRE–FILED)
By: Delegates Fair, Charkoudian, Palakovich Carr, Pruski, Ruth, and Vogel
Requested: November 1, 2024
Introduced and read first time: January 8, 2025
Assigned to: Ways and Means
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 1, 2025
CHAPTER ______
AN ACT concerning 1
Property Taxes – Authority of Counties to Establish a Subclass and Set a 2
Special Rate for Commercial and Industrial Property 3
FOR the purpose of authorizing the Mayor and City Council of Baltimore City or the 4
governing body of a county to establish, by law, a subclass of real property consisting 5
of certain commercial and industrial property and to set a special property tax rate 6
for certain commercial and industrial property for the purpose of financing certain 7
transportation improvements or the approved budget of the county board of 8
education; requiring that the special rate shall be in addition to a certain general tax 9
rate, may not exceed a certain amount, and may not apply to the residential portion 10
of a mixed–use building that receives a certain exemption or credit; requiring the 11
Mayor and City Council of Baltimore City or the governing body of a county to grant 12
either a property tax exemption or a property tax credit against a special rate on 13
commercial and industrial property for the residential portion of a mixed–use 14
building; requiring the exemption or credit to be granted automatically under certain 15
circumstances; requiring a county to provide notice of the exemption or credit and 16
accept applications for the exemption or credit; authorizing the Mayor and City 17
Council of Baltimore City or the governing body of a county to grant a property tax 18
credit against a special rate on commercial and industrial property imposed on real 19
property owned or leased by certain businesses with fewer than a certain number of 20
employees; and generally relating to a special property tax rate for commercial and 21
industrial property. 22
BY repealing and reenacting, with amendments, 23 2 HOUSE BILL 23
Article – Tax – Property 1
Section 6–202.1 and 6–302 2
Annotated Code of Maryland 3
(2019 Replacement Volume and 2024 Supplement) 4
BY adding to 5
Article – Tax – Property 6
Section 7–402, 9–112, and 9–275 7
Annotated Code of Maryland 8
(2019 Replacement Volume and 2024 Supplement) 9
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 10
That the Laws of Maryland read as follows: 11
Article – Tax – Property 12
6–202.1. 13
The Mayor and City Council of Baltimore City or the governing body of a county may 14
establish, by law, a subclass of real property consisting of: 15
(1) vacant lots [or] AND improved REAL property cited as vacant and unfit 16
for habitation or other authorized use on a housing or building violation notice; OR 17
(2) ALL REAL PROPERTY TH AT IS ASSIGNED THE F OLLOWING LAND 18
USE CODES, AS DEFINED BY THE MARYLAND ASSESSMENT PROCEDURE MANUAL: 19
(I) COMMERCIAL ; 20
(II) INDUSTRIAL; 21
(III) COMMERCIAL/INDUSTRIAL CONDOMINI UM; 22
(IV) RESIDENTIAL/COMMERCIAL ; AND 23
(V) COMMERCIAL /RESIDENTIAL. 24
6–302. 25
(a) Except as otherwise provided in this section and after complying with § 6–305 26
of this subtitle, in each year after the date of finality and before the following July 1, the 27
Mayor and City Council of Baltimore City or the governing body of each county annually 28
shall set the tax rate for the next taxable year on all assessments of property subject to that 29
county’s property tax. 30
HOUSE BILL 23 3
(b) (1) Except as provided in subsection (c) of this section and §§ 6–305 and 1
6–306 of this subtitle: 2
(i) there shall be a single county property tax rate for all real 3
property subject to county property tax except for operating real property described in § 4
8–109(c) of this article; and 5
(ii) the county tax rate applicable to personal property and the 6
operating real property described in § 8–109(c) of this article shall be no more than 2.5 7
times the rate for real property. 8
(2) Paragraph (1) of this subsection does not affect a special rate prevailing 9
in a taxing district or part of a county. 10
(c) (1) (I) The Mayor and City Council of Baltimore City or the governing 11
body of a county may set a special rate for a vacant lot [or] AND improved REAL property 12
cited as vacant and unfit for habitation or other authorized use on a housing or building 13
violation notice. 14
[(2)] (II) On or before December 1 each year, the Mayor and City Council 15
of Baltimore City or the governing body of a county that enacts a special rate under 16
[paragraph (1)] SUBPARAGRAPH (I) of this [subsection] PARAGRAPH shall report to the 17
Department of Housing and Community Development and, in accordance with § 2–1257 of 18
the State Government Article, to the General Assembly on: 19
[(i)] 1. the special rate set under [paragraph (1)] 20
SUBPARAGRAPH (I) of this [subsection] PARAGRAPH ; 21
[(ii)] 2. the number of properties to which the special rate applies; 22
[(iii)] 3. the revenue change resulting from the special rate; 23
[(iv)] 4. the use of the revenue from the special rate; and 24
[(v)] 5. whether properties subject to the special rate are viable 25
for adaptive reuse, as defined in § 1–102 of the Housing and Community Development 26
Article, and plans to convert viable properties. 27
(2) (I) SUBJECT TO THE REQUIR EMENTS OF THIS PARAG RAPH, 28
THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE GOVERNING BODY OF 29
A COUNTY MAY SET A S INGLE SPECIAL RATE F OR ALL REAL PROPERTY THAT IS 30
ASSIGNED THE FOLLOWI NG LAND USE CODES , AS DEFINED BY THE MARYLAND 31
ASSESSMENT PROCEDURE MANUAL: 32
1. COMMERCIAL ; 33
4 HOUSE BILL 23
2. INDUSTRIAL; 1
3. COMMERCIAL /INDUSTRIAL CONDOMINI UM; 2
4. RESIDENTIAL/COMMERCIAL ; AND 3
5. COMMERCIAL /RESIDENTIAL. 4
(II) A SPECIAL RATE SET UND ER SUBPARAGRAPH (I) OF THIS 5
PARAGRAPH MAY BE IMP OSED ONLY: 6
1. WITHIN A SPECIAL TAX ING DISTRICT ESTABLI SHED 7
FOR THE PURPOSE OF F INANCING THE COST OF STATE OR COUNTY 8
TRANSPORTATION IMPRO VEMENTS UNDER TITLE 21, SUBTITLE 7 OF THE LOCAL 9
GOVERNMENT ARTICLE; OR 10
2. ON A COUNTYWIDE BASI S FOR THE PURPOSE OF 11
FUNDING THE APPROVED BUDGET OF THE COUNTY BOARD OF EDUCATION . 12
(III) A SPECIAL RATE SET UND ER SUBPARAGRAPH (I) OF THIS 13
PARAGRAPH : 14
1. SHALL BE IN ADDITION TO THE GENERAL RE AL 15
PROPERTY TAX RATE SE T UNDER SUBSECTION (B)(1) OF THIS SECTION; 16
2. MAY NOT EXCEED A COMBINED TOTAL OF 12.5 CENTS 17
FOR EACH $100 OF ASSESSED VALUE FOR BOTH OF THE PURP OSES SPECIFIED IN 18
SUBPARAGRAPH (II) OF THIS PARAGRAPH ; AND 19
3. MAY NOT APPLY TO THE RESIDENTIAL PORT ION OF A 20
MIXED–USE PROPERTY THAT RE CEIVES EITHER AN EXE MPTION FROM THE SPEC IAL 21
RATE UNDER § 7–402 OF THIS ARTICLE OR A CREDIT AGAINST THE S PECIAL RATE 22
UNDER § 9–112 OF THIS ARTICLE. 23
(3) IF A COUNTY SETS A SP ECIAL PROPERTY TAX R ATE UNDER 24
PARAGRAPH (1) OR (2) OF THIS SUBSECTION , IT SHALL PROMPTLY SE ND A NOTICE 25
TO THE DEPARTMENT THAT INCLU DES: 26
(I) THE AMOUNT OF THE RA TE; AND 27
(II) THE CLASS OF PROPERT Y TO WHICH THE RATE APPLIES. 28
7–402. 29
HOUSE BILL 23 5
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 1
INDICATED. 2
(2) “MIXED–USE PROPERTY ” MEANS A PROPERTY THA T INCLUDES 3
BOTH: 4
(I) A COMMERCIAL OR INDU STRIAL USE; AND 5
(II) A RESIDENTIAL USE . 6
(3) “PUBLICLY AVAILABLE RE CORDS” INCLUDES: 7
(I) VALUATION RECORDS OF THE DEPARTMENT ; 8
(II) COUNTY RECORDS , INCLUDING LICENSE OR PERMIT 9
RECORDS; AND 10
(III) ANY OTHER RECORD FRO M A GOVERNMENTAL OR PRIVATE 11
SOURCE THAT IS ACCES SIBLE TO A COUNTY AN D PROVIDES RELIABLE INFORMATION 12
ON THE USE OF PRO PERTY. 13
(B) IF THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 14
GOVERNING BODY OF A COUNTY SETS A SPECIA L RATE UNDER § 6–302(C)(2) OF THIS 15
ARTICLE, THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE GOVERNING 16
BODY OF THE COUNTY S HALL, BY LAW, GRANT EITHER: 17
(1) A CREDIT AGAINST THE SPECIAL RATE FOR THE ENTIRE 18
RESIDENTIAL PORTION OF A MIXED–USE PROPERTY IN ACCO RDANCE WITH § 9–112 19
OF THIS ARTICLE; OR 20
(2) AN EXEMPTION FROM TH E SPECIAL RATE FOR T HE ENTIRE 21
RESIDENTIAL PORTION OF A MIXED–USE PROPERTY IN ACCORDANCE WITH T HIS 22
SECTION. 23
(C) A COUNTY MAY CALCULATE THE EXEMPTION UNDER THIS SECTION: 24
(1) AS A PERCENTAGE OF A MIXED–USE PROPERTY ’S SPECIAL TAX 25
LIABILITY THAT IS EQ UAL TO THE PERCENTAG E OF THE TOTAL SQUAR E FOOTAGE 26
OF THE PROPERTY THAT IS USED FOR RESIDENTIAL PU RPOSES; 27
(2) AS A PERCENTAGE OF A MIXED–USE PROPERTY ’S SPECIAL TAX 28
LIABILITY THAT IS EQ UAL TO THE PERCENTAG E OF THE TOTAL INCOM E PRODUCED 29
BY THE PROPERTY THAT IS DERIVED FROM RESI DENTIAL USE; OR 30
6 HOUSE BILL 23
(3) USING ANY OTHER REAS ONABLE METHOD THAT ENSURES THE 1
ENTIRE RESIDENTIAL P ORTION OF A MIXED –USE PROPERTY IS NOT SUBJECT TO THE 2
SPECIAL RATE. 3
(D) THE EXEMPTION UNDER T HIS SECTION CONTINUE S FOR AS LONG AS THE 4
SPECIAL RATE IS IN E FFECT. 5
(E) A COUNTY SHALL AUTOMAT ICALLY GRANT THE EXEMPTION UNDER THIS 6
SECTION WITHOUT REQU IRING AN APPLICATION FROM THE PROPERTY OW NER IF, 7
BASED ON PUBLICLY AV AILABLE RECORDS , THE COUNTY IS ABLE T O: 8
(1) IDENTIFY A MIXED –USE PROPERTY THAT IS SUBJECT TO THE 9
SPECIAL RATE; AND 10
(2) CALCULATE THE EXEMPT ION DUE FOR THE RESI DENTIAL 11
PORTION OF THAT MIXE D–USE PROPERTY . 12
(F) (1) IF, BASED ON PUBLICLY AV AILABLE RECORDS , A COUNTY IS ABLE 13
TO IDENTIFY A MIXED –USE PROPERTY THAT IS SUBJECT TO THE SPECI AL RATE BUT 14
HAS INSUFFICIENT INF ORMATION TO CALCULAT E THE EXEMP TION DUE FOR THE 15
RESIDENTIAL PORTION OF THAT MIXED–USE PROPERTY , THE COUNTY MAY REQUE ST 16
ADDITIONAL INFORMATI ON FROM THE OWNER OF THE MIXED–USE PROPERTY TO 17
ENABLE THE COUNTY TO CALCULATE THE EXEMPT ION DUE. 18
(2) IF AN OWNER OF A MIXE D–USE PROPERTY DOES NO T PROVIDE 19
THE INFORMATION REQU ESTED TO CALCULATE T HE EXEMPTION DUE , THE COUNTY 20
IS NOT REQUIRED TO G RANT THE EXEMPTION U NDER THIS SECTION TO THAT 21
MIXED–USE PROPERTY . 22
(G) A COUNTY SHALL ACCEPT APPLICATIONS FOR THE EXEMPTION UNDER 23
THIS SECTION FROM AN OWNER OF A MIXED –USE PROPERTY THAT IS NOT 24
AUTOMATICALLY GRANTE D AN EXEMPTION UNDER SUBSECTION (E) OF THIS 25
SECTION. 26
(H) (1) A COUNTY SHALL PROVIDE WRITTEN NOTICE OF TH E EXEMPTION 27
UNDER THIS SECTION T O THE OWNER OF EACH PROPERTY THAT IS SUB JECT TO THE 28
SPECIAL RATE AND IS NOT AUTO MATICALLY GRANTED AN EXEMPTION UNDER 29
SUBSECTION (E) OF THIS SECTION. 30
(2) THE NOTICE SHALL INCL UDE: 31
(I) A DESCRIPTION OF THE EXEMPTION UNDER THIS SECTION; 32
AND 33
HOUSE BILL 23 7
(II) INSTRUCTIONS ON HOW TO APPLY FOR THE EXE MPTION. 1
(I) THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 2
GOVERNING BODY OF A COUNTY MAY PROVIDE , BY LAW, FOR: 3
(1) REGULATIONS AND PROC EDURES FOR THE APPLI CATION AND 4
UNIFORM PROCESSING O F REQUESTS FOR THE E XEMPTION; AND 5
(2) ANY OTHER PROVISION NECESSARY TO CA RRY OUT THE 6
EXEMPTION UNDER THIS SECTION. 7
9–112. 8
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 9
INDICATED. 10
(2) “MIXED–USE PROPERTY ” MEANS A PROPERTY THA T INCLUDES 11
BOTH: 12
(I) A COMMERCIAL OR INDU STRIAL USE; AND 13
(II) A RESIDENTIAL USE. 14
(3) “PUBLICLY AVAILABLE RE CORDS” INCLUDES: 15
(I) VALUATION RECORDS OF THE DEPARTMENT ; 16
(II) COUNTY RECORDS , INCLUDING LICENSE OR PERMIT 17
RECORDS; AND 18
(III) ANY OTHER RECORD FRO M A GOVERNMENTAL OR A 19
PRIVATE SOURCE THAT IS ACCESSIBLE TO A C OUNTY AND PROVIDES R ELIABLE 20
INFORMATION ON THE U SE OF PROPERTY . 21
(B) IF THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 22
GOVERNING BODY OF A COUNTY SETS A SPECIA L RATE UNDER § 6–302(C)(2) OF THIS 23
ARTICLE, THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE GOVERNING 24
BODY OF THE COUNTY S HALL, BY LAW, GRANT EITHER : 25
(1) AN EXEMPTION FROM TH E SPECIAL RATE FOR T HE ENTIRE 26
RESIDENTIAL PORTION OF A MIXED–USE PROPERTY IN ACCO RDANCE WITH § 7–402 27
OF THIS ARTICLE; OR 28
8 HOUSE BILL 23
(2) A CREDIT AGAINST THE SPECIAL RATE FOR THE ENTIRE 1
RESIDENTIAL PORTION OF A MIXED–USE PROPERTY IN ACCO RDANCE WITH THIS 2
SECTION. 3
(C) A COUNTY MAY CALCULATE THE CREDIT UNDER THI S SECTION: 4
(1) AS A PERCENTAGE OF A MIXED–USE PROPERTY ’S SPECIAL TAX 5
LIABILITY THAT IS EQ UAL TO THE PERCENTAG E OF THE TOTAL SQUAR E FOOTAGE 6
OF THE PROPERTY THAT IS USED FOR RESIDENT IAL PURPOSES; 7
(2) AS A PERCENTAGE OF A MIXED–USE PROPERTY ’S SPECIAL TAX 8
LIABILITY THAT IS EQUAL TO THE PERC ENTAGE OF THE TOTAL INCOME PRODUCED 9
BY THE PROPERTY THAT IS DERIVED FROM RESI DENTIAL USE; OR 10
(3) USING ANY OTHER REAS ONABLE METHOD THAT E NSURES THE 11
ENTIRE RESIDENTIAL P ORTION OF A MIXED –USE PROPERTY IS NOT SUBJECT TO THE 12
SPECIAL RATE. 13
(D) THE CREDIT UNDER THIS SECTION CONTINUES FO R AS LONG AS THE 14
SPECIAL RATE IS IN E FFECT. 15
(E) A COUNTY SHALL AUTOMAT ICALLY GRANT THE CRE DIT UNDER THIS 16
SECTION WITHOUT REQU IRING AN APPLICATION FROM THE PROPERTY OW NER IF, 17
BASED ON PUBLICLY AV AILABLE RECORDS, THE COUNTY IS ABLE T O: 18
(1) IDENTIFY A MIXED –USE PROPERTY THAT IS SUBJECT TO THE 19
SPECIAL RATE; AND 20
(2) CALCULATE THE CREDIT DUE FOR THE RESIDENT IAL PORTION OF 21
THAT MIXED–USE PROPERTY . 22
(F) (1) IF, BASED ON PUBLICLY AV AILABLE RECORDS , A COUNTY IS ABLE 23
TO IDENTIFY A MIXED –USE PROPERTY THAT IS SUBJECT TO THE SPECI AL RATE BUT 24
HAS INSUFFICIENT INF ORMATION TO CALCULAT E THE CREDIT DUE FOR THE 25
RESIDENTIAL PORTION OF THAT MIXED–USE PROPERTY , THE COUNTY MAY REQUE ST 26
ADDITIONAL INFORMATI ON FROM THE OWN ER OF THE MIXED –USE PROPERTY TO 27
ENABLE THE COUNTY TO CALCULATE THE CREDIT DUE. 28
(2) IF AN OWNER OF A MIXE D–USE PROPERTY DOES NO T PROVIDE 29
THE INFORMATION REQU ESTED TO CALCULATE T HE CREDIT DUE , THE COUNTY IS 30
NOT REQUIRED TO GRAN T THE CREDIT UNDER T HIS SECTION TO THAT MIXED –USE 31
PROPERTY. 32
HOUSE BILL 23 9
(G) A COUNTY SHALL ACCEPT APPLICATIONS FOR THE CREDIT UNDER THIS 1
SECTION FROM AN OWNE R OF A MIXED –USE PROPERTY THAT IS NOT 2
AUTOMATICALLY GRANTE D A CREDIT UNDER SUB SECTION (E) OF THIS SECTION. 3
(H) (1) A COUNTY SHALL PRO VIDE WRITTEN NOTICE OF THE CREDIT 4
UNDER THIS SECTION T O THE OWNER OF EACH PROPERTY THAT IS SUB JECT TO THE 5
SPECIAL RATE AND IS NOT AUTOMATICALLY GR ANTED A CREDIT UNDER 6
SUBSECTION (E) OF THIS SECTION. 7
(2) THE NOTICE SHALL INCL UDE: 8
(I) A DESCRIPTION OF THE CREDIT UNDER THIS SE CTION; AND 9
(II) INSTRUCTIONS ON HOW TO APPLY FOR THE CRE DIT. 10
(I) THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 11
GOVERNING BODY OF A COUNTY MAY PROVIDE , BY LAW, FOR: 12
(1) REGULATIONS AND PROC EDURES FOR THE APPLICATION AND 13
UNIFORM PROCESSING O F REQUESTS FOR THE C REDIT; AND 14
(2) ANY OTHER PROVISION NECESSARY TO CARRY O UT THE CREDIT 15
UNDER THIS SECTION . 16
9–275. 17
(A) IF THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 18
GOVERNING BODY OF A COUNTY SETS A SPECIAL RATE UNDER § 6–302(C)(2) OF THIS 19
ARTICLE, THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE GOVERNING 20
BODY OF THE COUNTY M AY GRANT, BY LAW, A PROPERTY TAX CREDI T AGAINST THE 21
SPECIAL RATE IMPOSED ON REAL PROPERTY OWN ED OR LEASED BY A BU SINESS 22
THAT EMPLOYS 15 OR FEWER EMPLOYEES . 23
(B) THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY OR THE 24
GOVERNING BODY OF A COUNTY MAY PROVIDE , BY LAW, FOR: 25
(1) THE AMOUNT AND DURAT ION OF THE TAX CREDI T; 26
(2) ADDITIONAL ELIGIBILI TY REQUIREMENTS FOR THE TAX CREDIT; 27
(3) PROCEDURES FOR THE A PPLICATION AND UNIFO RM PROCESSING 28
OF REQUESTS FOR THE TAX CREDIT; AND 29
10 HOUSE BILL 23
(4) ANY OTHER PROVISION NECESSARY TO CARRY O UT THE TAX 1
CREDIT UNDER THIS SE CTION. 2
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take e ffect June 3
1, 2025, and shall be applicable to all taxable years beginning after June 30, 2025. 4
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.