(a) Definitions. In this Section, the following words have the following meanings.
Area median income means the median household income for the Washington, DC metropolitan area as estimated by the U.S. Department of Housing and Urban Development, adjusted by household size based on the occupancy standard for the unit.
Director means the Director of Finance or the Director’s designee.
Payment in lieu of taxes means an authorized payment made by the owner of a qualifying housing development instead of paying the County real property tax, including a County real property tax levied under a special area taxing law, that would otherwise be due.
Section 8 Project-Based Rental Assistance means a program operated by the U.S. Department of Housing and Urban Development that provides housing assistance payments under a contract with the owner of a multi-family rental housing property to make up the difference between rent affordable to a low income household earning between 50 and 80 percent of the area median income and the approved rent for an adequate housing unit pursuant to 42 U.S.C. §1437f, as amended.
(b) When authorized by state law, the Director may agree to accept a negotiated payment in lieu of the real property tax that would otherwise be levied on a qualifying housing development. A qualifying housing development is any housing development of which the owner is expressly eligible under state law to make payments in lieu of taxes.
(c) When authorized by state law, the Director must offer a payment in lieu of taxes for a qualifying housing development:
(1) owned or controlled by the Housing Opportunities Commission that exempts 100% of the real property tax that would otherwise be levied;
(2) owned or controlled by a non-profit housing developer if at least 50% of the dwelling units located on the property receiving the payment in lieu of taxes are built under a government regulation or binding agreement with the County limiting the rent charged for the unit for at least 15 years to make the unit affordable to households earning 60% or less of the area median income. The offer must exempt 100% of the real property tax that would otherwise be levied for a period of at least 15 years, but no more than the number of years that rents charged for 50% of the dwelling units must remain restricted to households earning 60% or less of the area median income; or
(3) owned or controlled by a non-profit housing developer if all of the dwelling units are subject to a Section 8 Project-Based Rental Assistance Payment contract. The offer must exempt 100% of the real property tax that would otherwise be levied as long as the Section 8 Project-Based Rental Assistance Payment contract is in effect.
(d) The Director must not offer a payment in lieu of taxes for a qualifying housing development under this Section for any property that has already received a payment in lieu of taxes under any Section.
(e) Any payment accepted by the Director must conform to guidelines included in a regulation adopted by the Executive under method (1). Before the Director accepts a payment in lieu of taxes, the Director must consult the Director of the Department of Housing and Community Affairs on whether:
(1) the subject of the payment is a qualifying housing development; and
(2) the amount of the payment complies with applicable guidelines.
(f) The Executive, in each annual operating budget submitted to the Council, must calculate the amount of pending payments in lieu of taxes already approved under this Section, including payments for housing developments owned or operated by the Housing Opportunities Commission. (2002 L.M.C., ch. 26, § 1; 2016 L.M.C., ch. 7, § 2; 2021 L.M.C., ch. 37, §1.)
Editor’s note—2021 L.M.C., ch. 37, § 2, states: Sec. 2. Transition. Except for Subsection (c)(3), the amendments in Section 1 establishing a mandatory payment in lieu of taxes must only apply to a property that is eligible for a payment in lieu of taxes due to affordable dwelling units that come under a government regulation or binding agreement limiting the rent charged on or after this Act takes effect.
2002 L.M.C., ch. 26, § 2, states, in part: This Act applies to taxes due during the tax year that began on July 1, 2002, and any later tax year. 2002 L.M.C., ch. 26, § 3, states: Until October 31, 2002, any payment accepted by the Director of Finance under County Code Section 52-18M (now § 52-24, 2016 L.M.C., ch. 7, § 1), inserted by Section 1 of this Act, need not conform to guidelines included in a regulation adopted by the County Executive, as required by Section 52-18M(b) (now § 52- 24(b)).