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.
*sb0327*
SENATE BILL 327
Q1, C9 5lr2256
CF HB 390
By: Senator Hettleman
Introduced and read first time: January 15, 2025
Assigned to: Budget and Taxation
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: February 21, 2025
CHAPTER ______
AN ACT concerning 1
Affordable Housing Payment In Lieu of Taxes Expansion Act 2
FOR the purpose of authorizing an owner of real property used for rental housing and the 3
governing body of a county to enter into a payment in lieu of taxes agreement for 4
maintaining at least a certain percentage of affordable dwelling units at the property 5
for at least a certain period of time; and generally relating to payment in lieu of taxes 6
agreements for affordable housing. 7
BY repealing and reenacting, without amendments, 8
Article – Land Use 9
Section 7–501(a), (b), (c), and (d) 10
Annotated Code of Maryland 11
(2012 Volume and 2024 Supplement) 12
BY adding to 13
Article – Tax – Property 14
Section 7–522 15
Annotated Code of Maryland 16
(2019 Replacement Volume and 2024 Supplement) 17
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 18
That the Laws of Maryland read as follows: 19
Article – Land Use 20
2 SENATE BILL 327
7–501. 1
(a) In this subtitle the following words have the meanings indicated. 2
(b) “Affordable” means that housing costs do not exceed 30% of a household’s 3
income. 4
(c) “Affordable dwelling unit” means a dwelling unit that is affordable to 5
households earning 60% or less of the area median income. 6
(d) “Area median income” means the median household income for the area 7
adjusted for household size as published and annually updated by the U.S. Department of 8
Housing and Urban Development. 9
Article – Tax – Property 10
7–522. 11
(A) IN THIS SECTION, “AFFORDABLE DWELLING UNIT” HAS THE MEANING 12
STATED IN § 7–501 OF THE LAND USE ARTICLE. 13
(B) REAL PROPERTY THAT IS USED FOR RENTAL HOUS ING MAY BE EXEMPT 14
FROM COUNTY PROP ERTY TAX IF: 15
(1) THE OWNER OF THE REA L PROPERTY AND THE G OVERNING BODY 16
OF THE COUNTY AGREE THAT THE OWNER SHALL PAY A NEGOTIATED AMO UNT IN 17
LIEU OF THE COUNTY P ROPERTY TAX; AND 18
(2) THE OWNER OF THE REA L PROPERTY ENTERS IN TO AN 19
AGREEMENT WITH THE G OVERNING BODY OF THE COUNTY TO MAINTAIN A T LEAST 20
50% 25% OF THE RENTAL HOUSIN G UNITS LOCATED AT T HE REAL PROPERTY AS 21
AFFORDABLE DWELLING UNITS FOR A PERIOD O F AT LEAST 15 YEARS. 22
(C) IN AN AGREEMENT UNDER THIS SECTION, THE GOVERNING BODY O F 23
THE COUNTY MAY REQUI RE THE OWNER OF REAL PROPERTY TO MAINTAIN A HIGHER 24
PERCENTAGE OF RENTAL HOUSING UNITS AS AFF ORDABLE DWELLING UNI TS THAN 25
THE MINIMUM PERCENTA GE SPECIFIED IN SUBS ECTION (B)(2) OF THIS SECTION. 26
(C) (D) REAL PROPERTY DESCRIB ED IN SUBSECTION (B) OF THIS 27
SECTION IS EXEMPT WH EN THE REQUIREMENTS OF SUBSECTION (B) OF THIS 28
SECTION ARE MET . 29
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 30
1, 2025, and shall be applicable to all taxable years beginning after June 30, 2025. 31