What Assembly did and didn't do For one thing, it OK'd test of how tax credits affect neighborhoods

April 14, 1996|By Daniel H. Barkin | Daniel H. Barkin,SUN STAFF

The Maryland General Assembly has given Baltimore and Baltimore County the right to test whether tax breaks can help slow the decline of older neighborhoods.

The measure -- the Neighborhood Preservation and Stabilization Act of 1996 -- was among several passed during the recently ended legislative session that affect real estate and the rights of property owners.

The bill sets up a demonstration project that would provide 10 years of property and income tax credits to home buyers.

Mayor Kurt L. Schmoke and County Executive C. A. Dutch Ruppersberger III can each choose a neighborhood -- one in the city and one in the county -- to designate for the tax breaks.

Each neighborhood must contain between 800 and 1,200 single-family dwellings.

The tax credits will be good only for owner-occupied homes purchased from July 1996 through June 30, 1999.

The credit would be 40 percent of the property tax bill for the first five years, and an amount equal to that would be a credit against the homeowner's state income tax bill.

The credit would shrink in each of the following five years, finally reaching zero after the 10th year.

Before the neighborhoods can be designated, a public hearing must be held in each jurisdiction.

The legislation, Senate Bill 599, was sponsored by Sens. Barbara A. Hoffman, Thomas L. Bromwell and Edward J. Kasemeyer of Baltimore County and Nathaniel J. McFadden of Baltimore City.

By June 1, the mayor and county executive must tell two General Assembly committees which neighborhoods have been designated and how many homes will be eligible for the credits.

"They've got a lot of work to do in a very short period of time," said James F. X. Cosgrove, vice president of Sentinel Title Corp. and a member of the Greater Baltimore Board of Realtors' legislative committee.

A state fiscal analysis of the bill estimated that the state and local revenue loss would amount to less than $100,000 in the first year.

"The intent is to stabilize and preserve good neighborhoods on the brink of decline," said Frank D. Boston III, lobbyist for the Greater Baltimore Board, which supported the measure.

The legislation was approved 45-0 by the state Senate and 106-20 by the House of Delegates.

The Assembly considered a number of other real estate and development-related bills in the session that adjourned last week:

* Legislation that would have reduced liability for companies that clean up and use "brownfields," contaminated former industrial sites, was not passed by the Assembly. House Bill 5 and Senate Bill 205 had differences that could not be reconciled, according to Mr. Boston.

Mitchell G. Gold, chairman of the commercial legislative committee of the Greater Baltimore Board, noted that there are "thousands of acres" of brownfields in Baltimore City, but added that every locality in the state has some.

These tracts would be more marketable if brownfield legislation had passed, said Mr. Gold, and that would have lessened development pressures in more rural areas.

Mr. Boston said he hopes that Gov. Parris N. Glendening will appoint a task force to study the matter and come up with recommendations that can be considered by the next session of the legislature.

* House Bill 421, which allows Baltimore City community associations to sue in Circuit Court to halt public nuisances that violate local codes, was passed.

* House Bill 1336, allowing developers to create ground rents in connection with new condominium projects, was passed.

The expressed purpose was to make it easier to build more affordable housing by reducing the financing required to buy a condo.

The original bill was amended to make it possible only with future projects.

* Senate Bill 93, which requires cities and counties to notify taxpayers through newspaper ads that they can pay property taxes semiannually, was passed.

The ads will include a tear-out form that can be used by taxpayers to request that their property taxes be paid on a semiannual basis to mortgage companies or other escrow account services.

* Senate Bill 744, dealing with changes to the Forest Conservation Act of 1991, did not pass.

One change would have allowed developers to restore or create forested areas not just on their construction sites but nearly anywhere county officials foresee environmental benefits.

The approach is known as "mitigation banking."

* House Bill 110, the Regulatory Standards and Accountability Act, would have made it more difficult for the state to adopt regulations that were more stringent than applicable federal standards. It did not pass.

Thomas Ballentine, lobbyist for the Home Builders Association of Maryland, said the failure of the forest act amendments and House Bill 110 showed that the legislature "didn't take advantage of some opportunities" to improve the regulatory climate in the state.

Pub Date: 4/14/96

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