Baltimore wants new dwelling tax credit back

ANNAPOLIS — Bree Jones is an emerging developer who formed her company Parity with the goal of reducing the disparity in homeownership.

She told the Senate Budget and Taxation committee on Wednesday, during a hearing on Sen. Antonio Hayes’  Senate Bill 63 reauthorizing the Baltimore’s Newly Constructed Dwellings tax credit that lapsed in June, that the credit allows companies like Parity to invest in blighted areas of the city.

“We’re injecting energy and light into west Baltimore where people never thought there would be,” Jones said.

Hayes’ reauthorization bill, which projects to cost the city $1.6 million in tax revenues by fiscal year 2025, adds a few new wrinkles to the program. Those changes include adding language covering a “Substantially Rehabilitated Dwelling.”

Eligible projects, under the new legislation, must be newly constructed or involve replacing at least 50% of a “major building component,” such as roof, wall and floor structures. That also includes foundations, plumbing and various electrical systems.

Rehabilitated properties must involve direct construction costs to the owner of more than $6,500, or 30% of the property’s assessed value in the taxable year after completion of associated work.

In a bid to steer the tax credit toward neighborhoods suffering from disinvestment the legislation caps eligible dwellings to properties with an assessed value of $500,000 or less.

Angelica Bailey, vice president of government affairs for the Maryland Building Industry Association, said they back reauthorizing the tax credit, but asked that the $500,000 cap be nixed.

“It doesn’t make sense to limit the tax credits until we have more information,” Bailey said.

After the hearing Jones said Parity, as part of a pilot program, plans on renovating 96 buildings in a 10-block area of west Baltimore. She said she primarily works with potential homeowners who make between $40,000 and $60,000 a year.

Baltimore’s Newly Constructed Dwellings Property Tax Credit, when stacked with other subsidies, Jones said, is crucial to making the dream of homeownership come true for those residents.

“It makes a world of difference,” Jones said.