Council introduces 25‑year PILOT pilot to support conversions of vacant commercial buildings to affordable housing

Montgomery County Councilmembers introduced Expedited Bill 2‑25, a proposal to create a 25‑year payment‑in‑lieu‑of‑taxes (PILOT) pilot for conversions of high‑vacancy commercial properties to housing with affordability requirements. Sponsors framed the bill as a tool to make conversions financially feasible and to pair with the recently introduced zoning measures that aim to convert vacant office space into housing.

"This goes side by side with that ZTA work that we're putting in place," Councilmember Fannie Gonzalez said when introducing the bill, noting the measure would mirror similar programs used elsewhere to incentivize conversion and require affordability. The sponsor thanked the county's legal staff for assistance drafting the measure and indicated the ordinance is debuting concurrent with zoning work on vacancy elimination and workforce housing.

The bill was introduced for public hearings on March 11, 2025. Legislative staff present included Jim O'Gorzak, the county legislative attorney, who was noted as available to the council. No vote was taken on the bill at introduction.

Why it matters: A multi‑year PILOT reduces near‑term tax liability for developers converting commercial buildings to housing, improving project feasibility when paired with affordability requirements and expedited approvals. Sponsors said the pilot is intended to support conversions that create affordable units while reusing vacant buildings.

Next steps: Public hearings on Expedited Bill 2‑25 were scheduled for March 11, 2025, at 1:30 p.m. and 7 p.m.; further committee review and legal analysis were indicated by sponsors.