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Debate over building excise tax credit pits redevelopment incentives against long-term road funding
Summary
Council Bill 54, which would change the definition of "new construction" to allow an excise tax credit for demolition and redevelopment, drew competing testimony from housing advocates and fiscal critics concerned about long-term road funding and fairness of credits.
Howard County Council members heard competing views on Council Bill 54-2025, which would amend the county’s building excise tax rules to give credits for demolishing existing buildings when developers replace them with new construction. Supporters said the change would incentivize redevelopment, preserve greenfields and spur economic activity; opponents warned the change could reduce revenue set aside for road and other infrastructure maintenance.
Jackie Yang, representing the Housing Affordability Coalition, told the council the measure could “incentivize reinvestment and redevelopment of older properties” and help create affordable housing by making redevelopment economically feasible.
Opponents including Ryan Powers of the Howard County Citizens Association urged the council to reject the bill. “We believe the building excise tax is needed to make up the balance for the county overall,” Powers said, citing county resurfacing and infrastructure needs and describing uncertainty in the fiscal-impact note. Powers presented back-of-the-envelope figures suggesting lost revenue from demolitions could represent a nontrivial share of resurfacing budgets.
Council members asked staff and commenters detailed questions about how the measure would interact with the school impact charge and other local fees. Commenters raised administrative concerns about calculating credits for buildings that predate the tax, and some asked for a “sunrise” date or other limits so the county would not effectively forgive payments that had already been assessed in earlier eras. Attorney and longtime local commentator Chris Alleva flagged administrative complexity and recommended clarifying an effective date.
Supporters argued redevelopment produces ongoing property and income tax revenue that can more than offset temporary excise-tax credits and helps preserve open land. Proponents also noted surrounding counties use similar language and administrative approaches.
Council members did not take a final vote at the hearing; questions about fiscal modeling and the long-term impact on road maintenance revenue were left for follow-up.
