In a previous post we introduced Maria, an irresponsible alcoholic parent. Her sister Juanita is fortunately much more responsible. Juanita’s daughter broke a leg during hyperactive cheerleading tryouts, and the orthopædist recommended a waterproof cast. Juanita runs to the medical supply store and sees an item for $200—exactly the amount she budgeted for medical emergencies. Juanita approaches the checkout, where the cashier demands $212. “Why the extra 12 dollars?” asks Juanita. “That’s the 6% Maryland sales tax.” “But I can’t afford the extra 12 dollars.” “You’re not seeing the entire picture. Some of that 12 dollars goes to repaving the Beltway’s Georgia Avenue offramp. Most of it goes to places like Baltimore, Prince George’s, and other jurisdictions. That’s called ‘public benefit.’ You do support public benefit, don’t you?” Impoverished and humiliated, Juanita leaves the store, hoping her church can give her a loan. It’s more important to pay the sales tax than it is to cure a child’s fractured leg.
Bill 2-25 (Taxation – Payments in Lieu of Taxes) authorizes a 20-year abatement on property taxes in return for converting commercial buildings to residential with a certain percentage of units designated as affordable. In his message from April 25, 2025, County Executive Marc Elrich gave reasons for his veto of 2-25. Let’s go through the objections.
“That’s not responsible policy—it is a blank check, and it is a corporate giveaway.” I’m not sure it’s a giveaway, but let’s say. The county’s legislative analyst estimates that the giveaway amounts to $2.6 billion over 25 years. Compare that with the giveaway to the county’s largest corporation: MCPS. This behemoth will take $90 billion of resource extraction over the same 25-year period, and no doubt much more. If we’re going to complain about corporate giveaways, let’s go after the biggest offenders.
“The Guardian apartments in Silver Spring added five stories and created 178 new units, and no tax breaks were needed.” This renovation is an amazing accomplishment, and congratulations to ReVite Construction for pulling it off. The reason it was feasible is that the building’s footprint was rectangular, not square. How many other buildings can be so converted? If we limit the conversions to only those that can be completed without tax abatements, then we limit the number of new affordable units.
“This bill does not meaningfully expand affordable housing either.” This is no doubt true. As I’ve written countless times, the only way to expand affordable housing is to rezone the acres and acres of R-60 and R-90 residential lots.
“It also undermines the MOVE grant program…designed to bring businesses back into office spaces.” The MOVE program was undermined before the freshly printed laser copies returned to room temperature. As I wrote in a previous post, MOVE’s minuscule giveaways will generate even less economic activity than what Bill 2-25 will provide in affordable housing. It’s meaningless to be concerned about MOVE’s outcomes.
“We can support housing without blindly giving away revenue. We already have tools to approve tax exemptions when they are needed.” Within one generation, those tools turned $300,000 single-family detached lots into $1 million estates. Those tools are the ones preventing mid-level federal workers (if any are still around) from purchasing a modest home.
CE Elrich and the other progressives have been in charge of the county’s housing policy for the last 30 years. Today, the number of affordable units relative to demand is even less than what it was 30 years ago. With that record, can we really believe that Elrich, Jawando, and Mink can deliver affordable housing? Has any progressive jurisdiction been able to deliver affordable housing?
In his email, CE Elrich stated that Bill 2-25 provides excessive tax benefits to developers with no public benefit. That’s the choice. For him, it’s more important to collect the property tax than it is to deliver affordable housing.
