Salisbury council holds wide housing policy discussion; ADUs, 4‑to‑2 zoning and developer incentives raised

Council members spent substantial time in a work‑session discussion on July 28 examining housing supply, affordability and policy tools the city could use to increase attainable options.

Councilwoman Sharon DeShield led a wide‑ranging review of housing types, financing and policy levers, telling members that Salisbury needs a “sustainable plan” that combines updated zoning, targeted incentives, code enforcement and coordination with county programs. She urged a focus on “middle housing” (starter and workforce homes) and identified the city’s high rental share (noted as roughly 70% rentals to 30% owners in one task‑force analysis) as a concern.

Accessory dwelling units (ADUs): DeShield reviewed recent state action requiring municipalities to adopt local ADU policies by Oct. 1, 2026 (House Bill 1466 was cited in the session). Staff and council discussed implementation details and constraints flagged by a webinar the planning department attended: state guidance will require the city to back any parking controls with a citywide parking study, and the ADU law raises questions about owner occupancy requirements, tax impact, and whether ADUs can be rented or sold. Planning staff said they have begun preliminary research and will present options.

4‑to‑2 occupancy ordinance and enforcement: councilmembers and multiple residents (including Mark Tillman and other longtime neighborhood residents) argued the existing 4‑to‑2 occupancy restriction has helped stabilize older single‑family neighborhoods near Salisbury University and asked whether the rule should be extended to additional districts. Staff noted that properties in certain “A” districts already have limits (four unrelated persons, etc.) and that enforcement uses the International Property Maintenance Code and registration processes when complaints arise. Staff described current inspection and administrative‑fine practices for rental registration and occupancy investigations and said they will provide more detail to the council.

Developer incentives and affordability tools: council discussed a range of tools—tax increment financing (TIF), Horizon tax‑credit waivers, fee waivers, developer tiering or inclusionary percentages, property tax abatements on converted rentals, revolving loan funds and down‑payment assistance. Several council members asked staff to draft options for requiring or incentivizing a portion of units in new developments be affordable, with suggested approaches including phased abatements and limited‑term tax incentives to balance developer economics and city affordability goals. Council asked staff to produce a draft policy and cost estimates for review in coming weeks.

Public and stakeholder input: residents and nonprofit leaders spoke during public comment. Molly Hellegos, CEO of Habitat for Humanity of Wicomico County, described affordability gaps for first‑time buyers (noting a two‑bedroom fair‑market rent rise of about 88% from 2010 to 2025 while median incomes grew far less) and said down‑payment gaps remain a major barrier even for families earning up to 80% of area median income. Other residents urged retaining and extending 4‑to‑2 protections to more neighborhoods to prevent over‑occupancy and preserve neighborhood stability.

Next steps: council members asked planning staff to return with concrete options: (1) draft inclusionary zoning/incentive options for developers (percentages, abatement timelines, and possible county participation); (2) prepare an ADU implementation plan that responds to state requirements (including whether to require a citywide parking study or seek grants to fund one); and (3) circulate a written summary of current registration and enforcement processes for occupancy complaints. Staff agreed to compile the materials and return to a future meeting for decisions.