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Sec. 11B-45. Disposition of real property. 1
(a) The County Executive must adopt regulations to establish a process for the disposition of any real property owned or controlled by the County, other than surplus school facilities and property of nominal value identified in the regulation. The regulations must provide for:
(1) coordination among County departments and outside agencies, including any municipality in which the real property is located;
(2) opportunity to reserve property for alternative public use;
(3) comparative analysis of reuse proposals from County departments and outside agencies before any disposition actions; and
(4) public notice and hearing on possible dispositions before final decision on disposition, except that the County Executive may waive the public hearing requirement for any real property that:
(A) has nominal value; or
(B) is recommended to be reused by the County government.
(b) As used in this Section the following words have the meanings indicated:
(1) County Department means any department or office within the executive branch of the Montgomery County Government.
(2) Disposition means a sale, a lease or license for a term of 2 years or longer, or a lease or other document which includes an option to buy. If a license or lease for an initial term of less than 2 years is extended or renewed beyond 2 years, that extension or renewal is a disposition. Disposition does not include:
(A) a lease of or license to use any parkland, or any facility located on parkland, that the Parks Department operates or manages for the County;
(B) a license to use County property that is coterminous with a contract for services performed by the licensee;
(C) a license to use County property to provide child or adult day care services;
(D) a sale or lease of property to the Housing Opportunities Commission for housing development;
(F) a transfer of County right-of-way that is needed to implement a road or transit project that is included in the applicable master or other land use plan.
(3) Outside agency means:
(A) the Housing Opportunities Commission;
(B) the Maryland-National Capital Park & Planning Commission;
(C) Montgomery College;
(D) Montgomery County Public Schools;
(E) the Revenue Authority;
(F) the Washington Suburban Sanitary Commission; and
(G) municipalities located in Montgomery County.
(c) Unless the County Council waives this requirement under subsection (e)(2)(B), the Executive must not dispose of any property owned or controlled by the County at less than full market value. In case of a sale of property, full market value must be determined by at least one professional appraisal of the property obtained by the Director within 12 months before a declaration is submitted to the Council.
(d) Before seeking Council approval of a declaration of no further need under subsection (e), the Executive must submit to the Council and allow the Council at least 30 days to comment on:
(1) all material terms of the disposition, including the price or rent to be paid and any associated economic incentives;
(2) any appraisal that the Executive relied on or will rely on in setting the property’s market value; and
(3) the comparative analysis of reuse proposals required in paragraphs (a)(3) and (h), including any proposals received from an outside agency.
In addition, the Executive should when practicable submit for prior Council review the parameters and material terms of a disposition that has not begun to be negotiated. Any document submitted under this subsection to the extent the document need not be disclosed under state law, must be treated as confidential.
(e) (1) In addition to the process required under subsection (a), before the disposition of any real property owned or controlled by the County (other than a property which has either nominal value or an appraised value lower than $100,000) becomes final:
(A) the Executive must publish a declaration in the County Register and post a notice on the County website that the County has no further need for the property or, if the disposition is a lease or license, has no further need for the property during the term of the lease or license; and
(B) the Council, by resolution adopted after the Council holds a public hearing with a least 15 days advance notice, must approve:
(i) the Executive’s declaration of no further need; and
(ii) any disposition of the property at less than full market value.
(C) The Council may disapprove the Executive’s declaration of no further need if the Council finds that:
(i) there is further need for the real property;
(ii) a County department or outside agency has expressed need for the real property; or
(iii) approval of the declaration is contrary to the public interest.
(2) The Director must adjust the $100,000 floor in this subsection on July 1 every third year by the percentage increase or decrease in the applicable Consumer Price Index for All Urban Consumers (CPI-U) for the Washington-Arlington-Alexandria Core Based Statistical Area (CBSA), as published by the United States Department of Labor, Bureau of Labor Statistics, or any successor index, during the previous 3 calendar years, rounded to the nearest $1000.
(3) The Council may waive the public hearing required by this subsection if it concludes that a hearing on a particular proposed disposition is not necessary to properly assess the proposed action.
(4) If the Council does not act under this subsection within 60 days after the Executive has submitted the proposed action, the proposed action is automatically approved. The Council may extend the 60-day deadline by resolution if the Council President has informed the Executive, within 30 days after the Executive submitted the proposed action, that the Council has not received all information necessary to review the proposed action. If the 60 day deadline would fall during August or from December 15 through December 31, the deadline is automatically extended until the next scheduled Council session.
(5) This subsection and subsection (c) do not apply to any disposition of property that will be used primarily for housing development if the recipient legally commits to the Director of the Department of Housing and Community Affairs that at least 30% of the housing units built on the property will be moderately priced dwelling units or other units that are exempt from the development impact tax under Section 52-41(g)(1)-(4).
(f) (1) Notwithstanding any law to the contrary but subject to any applicable bond covenants, 25 percent of the proceeds from the sale of real property owned by the County must be transferred to the Montgomery Housing Initiative Fund to promote a broad range of housing opportunities in the County.
(2) This subsection does not apply to real property in an area designated under Chapter 56 as an urban renewal area.
(3) In this subsection:
(A) “Proceeds” means the sale price of the real property, minus expenses the County incurs from the sale.
(B) “Real property” includes the right to develop the space above real property (“air rights”).
(4) The County Executive may waive this subsection for the portion of any proceeds from a sale that the County uses for a related purchase of real property.
(g) The Executive must adopt regulations to establish a process for disposition of surplus schools. As used in this Section, “surplus school” means any building used at any time as a public school and later conveyed to the County and all or part of the land which constitutes the school site. The regulations must provide for:
(1) the ultimate decision by the County Council, as required by state law, whether to dispose of a surplus school and its site, including any fields and recreational areas;
(2) a statement from the Board of Education before a surplus school is disposed of that the school will not be needed for public educational uses in the foreseeable future, and in any case at least for 10 years after the proposed sale;
(3) a statement from the Executive that the surplus school will not be needed for public recreational or human service uses in the foreseeable future;
(4) (A) timely referral to the Planning Board for its review under state law of any proposal to dispose of a surplus school, and
(B) a statement from the Board that the site will not be needed for park uses;
(5) an opportunity to offer alternative proposals before the Executive recommends a disposition to the Council;
(6) a public hearing by the Executive or the Executive’s designee, after reasonable notice, before any proposal to dispose of a surplus school is forwarded to the Council for action;
(7) a preference for the disposition that best retains public access to the school and its athletic and recreational facilities; and
(8) inclusion in any sale or lease with an option to buy of a clause that retains the County’s right to first refusal of any later sale of the property, subject to any mortgage or deed of trust then on the property, at fair market value.
If the Council does not receive any statement required under paragraphs (2)-(4), it may nevertheless dispose of a surplus school if it finds, considering all factors, that the public interest will be best served by disposing of the school.
(h) The Executive must adopt regulations to establish a process for leasing surplus schools. The regulations would apply in each case after the Council has adopted a reuse resolution which indicates what types of uses are acceptable. At a minimum, the regulations must require:
(1) a process that offers potential users a fair opportunity to present reuse proposals to the Executive’s designee within the scope of uses approved by the Council reuse resolution;
(2) referral of each proposed lease to the Council, Planning Board, and Board of Education for comment;
(3) a reasonable opportunity for public comment before any lease is signed on behalf of the County;
(4) continued community use of facilities such as auditoriums, gymnasiums, and playgrounds and playing fields except to the extent community access would unduly interfere with the lessee’s use of the property; and
(5) preservation of the County’s right to retrieve the property on reasonable notice for public school use when requested by the Board of Education. (1994 L.M.C., ch. 30, § 1; 1997 L.M.C., ch. 9, § 1; 1999 L.M.C., ch. 20, § 2; 2012 L.M.C., ch. 12, § 1; 2016 L.M.C., ch. 7, § 1; 2018 L.M.C., ch. 3, §1; 2019 L.M.C., ch. 15, §1.)
Editor's note—See County Attorney Opinion dated 1/31/00 indicating that the County may consent to the recording of a notice in the land records reflecting the State’s right of recovery under the Community Facilities Capital Grant statute.
2012 L.M.C., ch. 12, § 2 (in part) and § 3, state:
Sec. 2. Applicability. This Act takes effect on the date when it becomes law [May 15, 2012]. County Code Section 11B-45, as amended by Section 1 of this Act, does not apply to any disposition of County property for which a legally enforceable contract, lease, or other agreement was signed by all parties before that date.
Sec. 3. Applicability - White Flint Sector Plan area. Section 11B-45(b)-(e), as amended by Section 1 of this Act, does not apply to any sale by the County of real property located in the boundaries of the White Flint Sector Plan if: (a) the property was acquired by the County from the State Highway Administration; (b) the property was originally acquired by the State Highway Administration to construct Montrose Parkway; and (c) the sale by the County is completed on or before December 31, 2012.
2003 L.M.C., ch. 4, states: The Laws of Montgomery County 2003 are amended as follows:
(a) Notwithstanding those provisions of County Code Section 11B-45 or Regulation 4-99AM referred to in subsection (b) to the contrary, the County Executive may contract with the Yeshiva High School of Greater Washington, Inc. to:
(1) modify an existing lease-purchase agreement for the former Belt Junior High School to allow the County to reacquire that school and transfer it to Montgomery County Public Schools for public educational uses; and
(2) at the same time enter into a lease agreement for the former Montgomery Hills Junior High School that would allow Yeshiva High School of Greater Washington, Inc. to lease and occupy that school after the County has made certain improvements to it.
(b) Any agreement authorized by subsection (a) may:
(1) be adopted without following the reuse process in sections 4.1 through 4.7 of Regulation 4-99AM;
(2) have a longer term and greater notice of termination than required by section 6 of Regulation 4-99AM;
(3) limit community use of interior spaces as necessary to provide the lessee adequate security;
(4) allow the lessee to make certain minor capital improvements without County approval, and conform the rent credit provisions accordingly; and
(5) modify the capital improvement reimbursement provisions of section 6.9 of Regulation 4-99AM.
(c) Any agreement authorized by subsection (a) must:
(1) be subject to the approval of the County Council; and
(2) be referred to the Planning Board under state law in a timely manner for its review.
1999 L.M.C., ch. 20, § 3, reads: "Applicability. Section 11B-45, as amended by this Act, applies to any lease or other disposition of a closed school, as defined in that Section, that takes effect after this Act takes effect [January 6, 2000], including any renewal of a lease previously in force, but not to any extension of a lease previously in force without any material change in the terms of the lease. Any lease or other disposition of a closed school after the effective date of this Act [January 6, 2000] must conform to Section 11B-45 and the regulations required by Section 11B-45." 1999 L.M.C., ch. 20, § 4, reads: "Regulations. The County Executive must submit to the Council for its approval the regulations required by Section 11B-45, as amended by Section 2 of this Act, not later than 30 days after this Act takes effect [January 6, 2000]."
Editor's note—1999 L.M.C., ch. 20, § 3, reads: "Applicability. Section 11B-45, as amended by this Act, applies to any lease or other disposition of a closed school, as defined in that Section, that takes effect after this Act takes effect [January 6, 2000], including any renewal of a lease previously in force, but not to any extension of a lease previously in force without any material change in the terms of the lease. Any lease or other disposition of a closed school after the effective date of this Act [January 6, 2000] must conform to Section 11B-45 and the regulations required by Section 11B-45." 1999 L.M.C., ch. 20, § 4, reads: "Regulations. The County Executive must submit to the Council for its approval the regulations required by Section 11B-45, as amended by Section 2 of this Act, not later than 30 days after this Act takes effect [January 6, 2000]."