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Ground Up

The Daily Record's real estate blog

Baltimore’s $21M tax transfer infuriates affordable housing activists

A decision by Baltimore’s spending board to transfer $21 million of excess transfer and recordation taxes has angered affordable housing advocates.

On Wednesday, the Board of Estimates, which is controlled by the mayor, approved transferring those funds to cover Baltimore Police Department operational expenses and balance the agency’s budget. Advocates have pressed the mayor to provide $20 million annually to the Affordable Housing Trust Fund approved by voters in 2016.

Activists wanted Mayor Catherine Pugh to address why the money was not being directed to the trust fund. But Greg Sawtell, a Curtis Bay resident and Baltimore Housing Roundtable member, said the mayor left the meeting without discussing her decision.

“Today was really disappointing in terms of (how) the folks who made it into (Board of Estimates) were treated,” Sawtell said.

A spokesman for the mayor did not immediately respond to a request for comment.

When voters approved the Affordable Housing Trust Fund there was no funding mechanism attached. Activists have since sought to pressure the mayor into putting $20 million annually into the fund using general obligation debt.

Late last year activists said they felt betrayed by the mayor, who they said committed to supporting the 20/20 Campaign to invest $20 million in building permanent affordable housing and $20 million for jobs deconstructing vacant properties using general obligation bonds.

Pugh, at the time, said her words were being twisted. Ongoing city school budget woes and the expected $30 million cost of complying with a consent decree between police and the U.S. Department of Justice, she said, impinged on what Baltimore can spend on affordable housing.

At about the same time Councilman Bill Henry proposed legislation increasing the recordation and taxation fee charged on the sale of property in the city to fund the Affordable Housing Trust Fund, but the legislation failed to advance.

In April, Councilman John Bullock, with the backing of activists, introduced a similar piece of legislation, which would add 1 percent to the city’s transfer and recordation taxes on the sale of non-owner occupied properties. Those funds would then be used to provide about $20 million annually to the Affordable Housing Trust Fund.

That legislation is opposed by the building industry and commercial real estate interests who argue it adds an additional burden to a sector already paying more than its fair share of city taxes.

Council members, Sawtell said, have told him they expect to act on that legislation once the budget for fiscal year 2019 is approved.

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