Charles County, MD Article VIII Real Property Tax

[Adopted 6-10-1996 by Ord. No. 96-57]

§ 281-18 Tax imposed: January through March.

A tax is hereby imposed on all real property that during the period from January 1 to March 31, both inclusive, is completed or is otherwise initially added to the tax roll.

§ 281-19 Taxable three-month period; rate.

The tax shall be for the three-month period from April 1 to the following June 30, both inclusive, and shall be at 25% of the annual County tax rate that is in effect for that taxable year.

§ 281-20 Tax imposed: July through September.

[Added 6-10-1996 by Ord. No. 96-58]

A tax is hereby imposed on all real property that during the period from July 1 to September 30, both inclusive, is completed or is otherwise initially added to the tax roll.

§ 281-21 Taxable nine-month period; rate.

[Added 6-10-1996 by Ord. No. 96-58]

The tax shall be for the nine-month period from October 1 to the following June 30, both inclusive, and shall be at 75% of the annual County tax rate that is in effect for that taxable year.

§ 281-22 Credit for surviving spouse of law enforcement, corrections, fire, rescue and emergency medical service personnel.

[Added 12-1-2003 by Bill No. 2003-12[1]; 7-22-2009 by Bill No. 2009-05]

A. Definitions. In this section, the following words have the meanings indicated:

DWELLING

(1) Real property that:

(a) Is the legal residence of a surviving spouse; and

(b) Is occupied by not more than two families.

(2) Includes the lot or curtilage and structures necessary to use the real property as a residence.

FALLEN RESCUE WORKER

An individual who dies in the line of duty, while in the active service of a law enforcement, corrections, fire, rescue or emergency medical service, unless the death was the result of the individual's own willful misconduct or abuse of alcohol or drugs.

SURVIVING SPOUSE

Surviving spouse, who has not remarried, of a fallen rescue worker.

B. Credit. In accordance with § 9-210 of the Tax - Property Article of the Annotated Code of Maryland, an owner of real property may receive a property tax credit under this section against the County property tax imposed on a dwelling, if the owner is a surviving spouse of a fallen rescue worker and:

(1) The dwelling was occupied by the fallen rescue worker at the time of the fallen rescue worker's death;

(2) The fallen rescue worker or the surviving spouse was domiciled in the state as of the date of the fallen rescue worker's death and the dwelling was acquired by the surviving spouse within two years of the fallen rescue worker's death; or

(3) The dwelling was acquired after the surviving spouse qualified for a credit for a former dwelling under Subsection B(1) or (2) of this section, to the extent of the previous credit.

C. Duration of credit. The tax credit continues until the surviving spouse remarries.

D. Amount of credit.

(1) If the fallen rescue worker's primary place of employment or volunteerism was in the County, then the amount of the tax credit is equal to 100% of the County property tax imposed on the dwelling.

(2) If the fallen rescue worker's domicile is in the County but the primary place of employment or volunteerism was outside of the County, then the amount of the tax credit is equal to 50% of the County property tax imposed on the dwelling.

E. Application. A surviving spouse:

(1) Is eligible for the tax credit beginning in the first taxable year after the date of the fallen rescue worker's death;

(2) May apply for the tax credit on or before September 30 in the taxable year for which the credit is requested to begin;

(3) Must submit a renewal application each year.

F. Administration.

(1) The Director of Fiscal Services shall develop an application form and establish procedures to administer the tax credit established in this section.

(2) The Director of Fiscal services will require evidence of continued eligibility through the annual renewal application.

(3) Each year, the Director of Fiscal Services shall submit a report to the County Commissioners detailing the fiscal impact of this tax credit on the County.

(4) Notwithstanding Subsection E of this section, the credit will not be applied retroactively.

[1] Editor's Note: This bill also provided that it would be applicable to all taxable years beginning after 6-30-2003.

§ 281-23 Homeowners tax credit.

[Added 6-20-2005 by Bill No. 2005-16; amended 2-1-2011 by Bill No. 2010-15]

A. Definitions. The following words have the meanings indicated:

COMBINED INCOME

Has the meaning indicated in § 9-104 of the Tax - Property Article of the Maryland Annotated Code.

COMBINED NET WORTH

The net worth of all individuals who actually reside in the dwelling, less the value of the property as assessed by the State Department of Assessments and Taxation, not including an individual who:

(1) Is a dependent of the homeowner under § 152 of the Internal Revenue Code; or

(2) Pays a reasonable amount for rent or room and board.

DWELLING

Has the meaning indicated in § 9-104 of the Tax - Property Article of the Maryland Annotated Code.

HOMEOWNER

Has the meaning indicated in § 9-104 of the Tax - Property Article of the Maryland Annotated Code.

B. Credit established.

(1) There is a local supplement to the Homeowners Property Tax Credit Program established by § 9-104 of the Tax - Property Article of the Maryland Code and authorized under § 9-215 of the Tax - Property Article of the Maryland Code.

(2) The property tax to which this section applies is the product of the sum of all County property tax rates on real property for the taxable year on a dwelling multiplied by the lesser of the assessed value of the dwelling or $300,000 and then reduced by any property tax credit granted under § 9-105 of the Tax - Property Article of the Maryland Code.

C. Amount.

(1) Unless eligible for the enhancement under Subsection D, the County supplemental property tax credit is the total real property tax on a dwelling less:

(a) The percentage of the combined income of the homeowner calculated under Subsection C(2) of this section; and

(b) The property tax credit granted under § 9-104 of the Tax - Property Article of the Maryland Code.

(2) The percentage of the combined income of the homeowner referred to in Subsection C(1) is:

(a) Zero percent of the first $5,000;

(b) One percent of the next $5,000;

(c) Two percent of the next $5,000;

(d) Three percent of the next $5,000;

(e) Four percent of the next $5,000;

(f) Five percent of the next $5,000;

(g) Six percent of the next $5,000;

(h) Seven percent of the next $5,000;

(i) Eight percent of the next $5,000; and

(j) Nine percent of the next $5,000.

(3) The property tax credit under this section shall be proportionately reduced for a homeowner who is not required to pay the tax for the full tax year.

D. Enhanced supplement.[1]

(1) Eligibility. There is an enhanced local supplement if, as of the end of the calendar year preceding the taxable year for which the enhanced local supplement is sought:

(a) One of the homeowners is at least 70 years of age;

(b) One of the homeowners has resided in the dwelling for more than 20 years;

(c) The homeowners have a combined net worth of $200,000 or less; and

(d) The homeowners have a combined income of $50,000 or less.

(2) Amount of enhanced local supplement.

(a) If the eligibility criteria described in Subsections C and D(1) are met, the amount of the enhanced local supplement to the homeowners property tax credit program is 130% of the amount calculated in Subsection C, but shall not exceed the amount of the County Real Property Tax imposed on the dwelling.

(b) If only the eligibility criteria described in Subsection D is met, the amount of the enhanced local supplement to the homeowners property tax credit program is equal to the maximum credit allowed under the County's Homeowners Property Tax Credit Program according to income level.

(3) No retroactivity. The enhanced supplement goes into effect in fiscal year 2012. This program shall not be applied retroactively.

[1] Editor's Note: Section 2 of this bill also provided the enhanced supplement to the Homeowner's Tax Credit, Subsection (D), shall terminate and be of no effect at the close of the fiscal year unless the County Commissioners take action to prevent such termination. In the event that action is taken to prevent the enhanced supplement to terminate in any fiscal year, this sundown shall be applicable to the following fiscal year.

E. Administration. This section shall be administered by the Director of Fiscal and Administrative Services and the State Department of Assessments and Taxation as provided in §§ 9-104 and 9-215 of the Tax Property Article of the Maryland Code.

F. Regulations. The County Commissioners may adopt regulations to carry out this section.

G. Report. Each year, the Director of Fiscal and Administrative Services may submit a report to the County Commissioners that describes program participation in the current tax year and includes the income of taxpayers and the number and cost of the credits allowed.

H. Applications. All applications for Homeowners' Supplemental Property Tax Credit administered under this section must be submitted in a form approved by the Director of Fiscal and Administrative Services and signed by the homeowner, under oath and under penalty of perjury.

§ 281-24 Tax credit for qualified expenses for the restoration or rehabilitation of historic properties.

[Added 1-14-2009 by Bill No. 2008-16[1]]

A. Authority. In accordance with § 9-204.1 of the Tax - Property Article of the Annotated Code of Maryland, there is a Charles County property tax credit in the amount of 10% of the qualified expenses used for the restoration and preservation of an eligible property.

B. Definitions. In this section, the following terms have the meaning indicated:

CERTIFICATE OF ELIGIBILITY

The document issued by the Commission to the owner of an eligible property, which authorizes the department of fiscal services to apply a historic tax credit to the eligible property.

COMMISSION

The Historic Preservation Commission created under Chapter 297 of the County Code.

ELIGIBLE PROPERTY

A principal building, outbuilding, or cemetery that is designated as a local historic landmark or lies within a designated Historic District.

ELIGIBLE WORK

Work done on an eligible property.

(1) In compliance with the rules as adopted by the Commission under Chapter 297 of the County Code;

(2) After the owner receives initial approval of an application for a certificate of eligibility; and

(3) In conformity with the application for which initial approval was given.

(a) Eligible work includes:

[1] The repair or replacement of exterior features of the structure;

[2] Work that is necessary to maintain the physical integrity of the structure with regard to safety, durability, or weatherproofing;

[3] Maintenance of the exterior of the structure including routine maintenance; and

[4] Repair or maintenance of existing gravestones, walls, fencing, or other site features of an existing historic property including cemeteries.

(b) Eligible work does not include:

[1] New construction;

[2] Interior finish work that is not necessary to maintain the structural integrity of the building; or

[3] Landscape maintenance or new landscape plantings.

QUALIFIED EXPENSES

(1) The amount of money paid to a licensed contractor by the owner of an eligible property for eligible work.

(2) The amount of money paid by an owner of an eligible property to a licensed contractor for eligible work or for materials used to do eligible work.

(3) In order to be eligible for a tax credit under this section, qualified expenses must be $500 or greater.

ROUTINE MAINTENANCE

Work that qualifies as routine maintenance under Chapter 297 of the County Code.

C. Procedures.

(1) The owner of an eligible property may apply to the Commission for a historic tax credit for qualified expenses. The application shall be in the form and accompanied by additional information that the Commission, by rule, requires.

(2) The Commission shall give initial approval of a certificate of eligibility:

(a) If it determines that property to be an eligible property;

(b) If it determines that the proposed work is eligible work; and

(c) If the proposed work has been issued a historic area work permit.

(3) Upon completion of the work, the owner shall submit to the Commission documentation that the work was done in accordance with the initial approval of the historic area work permit and shall document all qualified expenses.

(4) The Commission shall review the application, the initial approval, and the documentation.

(5) At a public meeting, the Commission shall give final approval of the certificate of eligibility once the project has been completed and all documentation has been submitted to the Commission.

(6) Upon final project review, the Commission shall determine what work is eligible work; and the dollar amount of qualified expenses for the work.

(7) The dollar amount of qualified expenses and the amount of tax credit shall be entered on the certificate of eligibility.

(8) After final approval by the Commission, the Commission shall forward the certificate of eligibility to the Treasurer's Office.

(9) The Department of Fiscal Services shall grant the tax credit for the tax year in which the certificate of eligibility is received by the department.

(a) If the amount of the tax credit under this section exceeds the amount of the Charles County Real Property Tax, any unused portion of the tax credit shall be carried forward for up to four years.

(b) The total tax credit available for all eligible projects in a given fiscal year shall be determined by the County Commissioners.

(c) Approved tax credits are available as determined by the Commission in accordance with a ranking order based on criteria to be established by the Commission.

D. Change in ownership. Change in ownership will result in the lapse of a tax credit granted under this section. Once the property has been sold, neither the former or current property owner are eligible for the remainder of the credit.

E. Appeals. The owner who is denied all or part of a tax credit by the Commission may appeal to the Circuit Court of Charles County.

[1] Editor's Note: This bill was originally adopted as § 281-23 but was renumbered to fit into the structure of this article.

§ 281-25 Property tax credit for Habitat for Humanity properties.

[Added 1-11-2011 by Bill No. 2010-20]

A. Authorization. Pursuant to the authority granted by the Annotated Code of Maryland, Tax - Property Article, § 9-252, the County Commissioners of Charles County are establishing a property tax credit for Habitat for Humanity-owned properties that meet the criteria set forth below.

B. Properties eligible for the tax credit.

(1) Property must be owned by the Habitat for Humanity with the intention of relinquishing ownership in the immediate future;

(2) Property must be used exclusively for the purpose of rehabilitation and transfer to a private owner; and

(3) Property must not be occupied by administrative offices or used for warehousing items owned by Habitat for Humanity.

C. Amount of credit. The credit shall be equal to 100% of the total amount of the County's portion of the real property taxes assessed against the property.

D. Annual report. Habitat for Humanity shall submit to the County Commissioners a certified annual report that contains a list of:

(1) All of Habitat for Humanity's real property holdings in Charles County, identifying those that are administrative or used for warehouses and those that will be rehabilitated and transferred to private owners; and

(2) All transactions involving Habitat for Humanity's real property holdings in Charles County.

E. Annual review by County. The Department of Fiscal and Administrative Services shall perform an annual review of the fiscal impact of the credit on the annual budget, and shall report any recommendations regarding the sustainability of the program to the County Commissioners, including the possibility of amending the percentage amount of the credit.

F. No retroactivity. This program goes into effect in fiscal year 2012, and the credit shall be applied to qualified properties from FY 2012 and onward. This program shall not be applied retroactively.

§ 281-26 Conservation easement.

[Added 3-20-2013 by Bill No. 2013-06]

A. The original grantor of a donated perpetual conservation easement shall be entitled to a property tax credit against the County tax for all agricultural and forest land, including farm improvements, subject to the donated perpetual conservation easement. The property tax credit shall not be applicable to any residential structures. The perpetual conservation easement shall be donated to the conservancy for Charles County, Inc. or another qualified entity approved by the Charles County Commissioners.

B. The property tax credit granted under this section shall:

(1) Benefit the original grantor of the perpetual conservation easement;

(2) Be granted for the duration of time that the original grantor of the perpetual conservation easement continues to reside on the property subject to the easement;

(3) Terminate upon transfer of the property subject to the conservation easement by the grantor; and

(4) Be applicable to existing donated perpetual conservation easements.

C. The property tax credit shall be administered by the Director of Fiscal and Administrative Services who is hereby authorized to adopt rules and regulations deemed necessary to provide for the orderly and systematic implementation of the property tax credit. The Director may require that an application be filed for the property tax credit.

D. This tax credit shall be applicable to all taxable years beginning after June 30, 2012.

§ 281-27 New or expanding business.

[Added 1-28-2014 by Bill No. 2013-17]

A. To encourage the location and development of business operations and expansion of the employment base in Charles County, the governing body of Charles County may grant, by law, a property tax credit against the County property tax imposed on any property owned by a new or expanding business that creates 10 or more full-time jobs in an industry targeted for expansion by the Charles County Department of Economic Development. Such jobs must have average annual salaries above the median County earnings.

B. A tax credit granted under this section may not be granted for more than 10 years.

C. The business must maintain at least 10 or more new permanent full-time positions each year as a condition of continuing to receive the credit. The list of industries targeted by the Economic Development Department shall be approved by resolution from time to time by the County Commissioners.

D. The property tax credit shall be administered by the Director of Fiscal and Administrative Services who is hereby authorized to adopt rules and regulations deemed necessary to provide for the orderly and systematic implementation of the property tax credit. The Director may require that an application be filed for the property tax credit.

E. The Directors of Economic Development and Fiscal and Administrative Services shall report annually to the County Commissioners concerning the implementation of the tax credits approved under this section. At a minimum, the report shall include the dollar amount of the tax credit, the number of jobs and the average annual salaries that qualified the recipient for the tax credit.

F. If a business entity is or will be the recipient of any other County real property tax credit or payment-in-lieu-of-taxes agreement under any other provision of County or state law, it shall not be entitled to a tax credit under this section.

G. This tax credit shall be applicable to all taxable years beginning after June 30, 2013.

§ 281-27.1 Business improvement incentive tax credits.

[Added 12-15-2021 by Bill No. 2021-11]

A. Definitions. As used in this section, the following terms shall have the meanings indicated:

BUSINESS REAL PROPERTY

Land and buildings used wholly and exclusively in a business.

REHABILITATION

The process of returning a property to a state of utility, through repair or alteration, which makes possible an efficient business use.

RENOVATION

The change, strengthening, or addition of load-bearing elements, or the refinishing, replacement, bracing, strengthening, upgrading, or extensive repair of existing materials, elements, components, equipment or fixtures. or all of these.

(1) "Renovation" does not include the interior reconfiguration of space or painting.

(2) "Renovation" shall include the total reconstruction of a prior existing business property.

B. Scope of the tax credit; applications process; approval/denial by Director of Economic Development

(1) For the purpose of encouraging economic development by revitalizing business communities, the County Commissioners are hereby authorized to grant a real property tax credit to the owner(s) of any qualifying business real property within the County where an increase in the assessed value of said improved property has occurred as the direct result of the rehabilitation or renovation of the property.

(2) The credit shall be calculated annually as a declining percentage of the taxes due on the increased property assessment as a result of the improvements and shall not exceed five full consecutive taxable years.

(3) To be eligible for the credit, the increase in the assessed value must be greater than $100,000 USD and shall not exceed $3,000,000 USD.

(4) It shall be the sole responsibility of the property owners to apply for the tax credit and to provide documentation satisfactory to the economic development department as to the qualifications of the property for said credit.

(5) The Charles County Economic Development Department shall serve as the primary point of contact for receiving applications, on a form developed and approved by the department, and shall conduct the initial evaluation of qualifications and eligibility for the credit. Once the applications have been reviewed and approved by the Charles County Economic Development Department, they will be forwarded to the Department of Fiscal and Administrative Services.

(6) In accordance with standards approved by the County Commissioners, the Director of Fiscal and Administrative Services shall recommend the approval or denial of the tax credit.

C. Calculation of the credit.

(1) Computation of the base credit. the base credit amount is the difference between the increased assessed value of the property as a result of the improvement/rehabilitation and the assessed value of the property from the year prior to the improvement/rehabilitation. Only official assessment notices issued prior to and after investment/renovation improvements shall be considered evidence of the assessed values.

(2) Duration. The credit shall be for five full years of taxes and shall be calculated as follows:

(a) 100% credit in year one of the base credit amount in Subsection C(1).

(b) 80% credit in year two of the base credit amount in Subsection C(1).

(c) 60% credit in year three of the base credit amount in Subsection C(1).

(d) 40% credit in year four of the base credit amount in Subsection C(1).

(e) 20% credit in year five of the base credit amount in Subsection C(1).

(3) Any property tax credit granted pursuant to this section shall be based on the current tax rate.

D. Limitations. The approved credit is applied only to the County tax assessment and does not apply as a credit against the assessment for state, municipality (town), fire and rescue, fair share school construction taxes, or taxes the property owner may in the future be required to pay to the County that is not already included in the real property tax and fees bill.