Greater Baltimore Committee President and CEO Donald C. Fry has submitted testimony to the Baltimore City Council for Council Bill 18-0221 – Recordation and Transfer Taxes – Surtax – Dedicating Surtax Proceeds to Affordable Housing Trust Fund.
“Council Bill 18-0221 is meant to address the mistake of two years ago by providing dedicated funding for the Affordable Housing Trust Fund. This funding source will not only allow for the construction of affordable housing units but also a variety of homeownership services.
The Greater Baltimore Committee is supportive of efforts to increase homeownership and make housing more affordable for Baltimore City residents.
There are two amendments to this legislation that we urge the committee to consider. First, we propose the creation of a sunset provision that would allow the program to be evaluated for effectiveness after three years. Housing advocates have sought, and the Mayor has committed to $20 million annually to be dedicated for the affordable housing fund. But to date no one has been able to provide an accurate picture of how that money will be spent. A sunset provision would provide an opportunity for the City Council to ensure that the money has been used effectively and for its intended purpose.
Second, the committee should consider a “grandfather clause” that allows a real estate development project that has already met city approvals to be exempt from the increased tax. As outlined in the GBC’s report, “Gaining a Competitive Edge”, businesses rely on predictability to thrive. Implementing a significant change in the tax rate that will increase the cost of an approved project by tens of thousands of dollars would be incredibly crippling to those developments.
While the GBC supports efforts to increase affordable housing, it is important to note that the legislative process by which this legislation has proceeded lacks transparency, openness, and fails to meet acceptable standards of a fair process. The passage of any legislation in this fashion should be a concern to individuals who live in or conduct business with the City of Baltimore.
It is respectfully requested that the amendments discussed herein be given due consideration and that any final committee vote be delayed until the traditional City Council legislative process has been met.”
Read Fry’s testimony in its entirety here.