Council weighs cutting Invest Hagerstown funding as program leaders say they could 'weather a year'

HAGERSTOWN, Md. — Councilors discussed a proposal to reduce the Invest Hagerstown allocation by $500,000 as part of efforts to lower the proposed tax increase. Invest Hagerstown staff and program supporters told the council the program has a fund balance and could absorb a one‑year reduction, but cautioned that sustained cuts would reduce grant activity and slow homeownership gains.

Invest Hagerstown staff described the program as supporting multiple activities including a homeownership grant program and redevelopment grants. Staff noted the program’s recent pace: they reported unusually high demand for homeowner assistance in the current year and said repayment and forfeiture activity had left a fund balance that could cover a temporary reduction.

“We can weather a year with a $500,000 cut because we’re sitting on a fund balance due to some projects that had forfeited their dollars,” Invest Hagerstown staff told the council. Staff also pointed out the program’s return on investment: between FY19 and FY24 the city’s Invest Hagerstown dollars were shown in the budget materials to have leveraged roughly $48.2 million in private and other investment on about $4.8 million of city funds.

Councilors voted informal tallies on the $500,000 proposal during the session; the result was mixed and no formal, binding reduction was adopted. Several council members said they preferred a smaller, time‑limited reduction or slicing a reduction across programs rather than eliminating a major funding bucket.

Separately, councilors discussed an alternative offset: staff identified roughly $375,000 of assumed property tax revenue that would be lost if a large taxpayer (the stadium) were removed from the tax base; some members proposed covering that loss through contingencies rather than cutting Invest Hagerstown. Staff said they could reallocate contingency funds to offset the $375,000, but the council did not finalize a decision during the session.

Council members and Invest Hagerstown leaders agreed on the program’s goals — increasing homeownership and leveraging private investment — but differed on whether a one‑time reduction would be advisable while the city wrestles with its broader revenue needs. Councilors asked staff to model both a $500,000 cut and smaller, temporary reductions, showing likely impacts on homeownership grants and redevelopment activity. No final funding action was taken; staff were asked to return numbers and options at the next meeting.

The Invest Hagerstown funding question was discussed alongside the broader budget debate about whether to raise taxes, cut services or use one‑time reserves to cover ongoing costs.