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St. Mary’s County commissioners back Spring Valley renovation; authorize $515,000 CDBG application
Summary
The Board of County Commissioners approved a support letter to the Maryland Department of Housing and Community Development for tax-exempt bond financing and authorized a $515,000 Community Development Block Grant application to reduce principal on Spring Valley Apartments, a 128-unit mixed-income complex in Lexington Park.
The Board of County Commissioners for St. Mary’s County on May 15 approved a county support letter to the Maryland Department of Housing and Community Development for tax-exempt bond financing and separately authorized submission of a $515,000 Community Development Block Grant (CDBG) application to reduce outstanding debt on Spring Valley Apartments, a 128-unit rental complex in Lexington Park.
The measures, approved in separate votes, aim to fund renovation work — including new roofs, windows and energy-efficient HVAC systems — while keeping the development’s mixed-income character and limiting upward pressure on rents. County staff said the CDBG award, if granted, would reduce the loan principal by about $500,000 and translate into roughly a $25-per-month reduction in rent averaged across all units if distributed evenly.
County staff presented the financing request on behalf of Humphrey Development, which is pursuing state tax-exempt bond financing and a CDBG award to renovate Spring Valley. The board’s support letter signals local backing required by the Maryland Department of Housing and Community Development (DHCD) for projects that use DHCD lending. The staff presentation noted state underwriting is the next step and that the county would be notified in late July or August on award decisions.
Discussion at the meeting focused on three themes: preservation of mixed-income/workforce housing, the long-term source of capital for future renovations, and whether the project would increase units tied to rental-assistance programs. A county staff member said the proposed financing “is not putting a firm cap to say you can't raise rent” but that below-market financing and potential replacement reserves would allow rents to remain more moderate than otherwise required by higher-cost debt. The transcript records concerns from several commissioners about maintaining upward mobility and avoiding a concentration of permanently subsidized housing.
Commissioners heard that approximately 35 of Spring Valley’s roughly 128 households currently receive housing-choice voucher payments that the household brings to the property; the units themselves are not set aside as project-based vouchers. The developer’s representative said the renovation work is designed to last two decades and that a replacement-reserve fund and future financing tools would be used if additional capital work is required later.
Votes at the meeting: the board voted unanimously to approve the DHCD support letter. The CDBG resolution to seek $515,000 passed with one commissioner voting no; the clerk recorded one nay and the motion carried.
If awarded, the CDBG funds would be combined with DHCD financing options to reduce the owner’s debt service and preserve affordability for mixed-income tenants. County staff said any final financing structure would be brought back to the commissioners for a formal support resolution when DHCD completes underwriting.
