Joint committee backs creation of Viva White Oak development district, sets $420 million TIF cap

A Montgomery County joint committee on government operations and economic development on a motion advanced a resolution to create the Viva White Oak Development District and a special taxing district that would enable up to $420,000,000 in tax‑increment financing (TIF) bonds to fund horizontal site work, remediation and infrastructure supporting a planned town center.

The resolution cleared the committee unanimously after two amendments were adopted. The first, offered by Council President Fannie Gonzalez, requires a local park for the project to be constructed before issuance of the final use and occupancy certificate for the townhouse development proposed in the APF application and sets an expectation that the park will be financed and delivered "no later than the second bond issuance," language that staff said would be clarified to refer to the Series B timing in the fiscal tables. Gonzalez argued the park’s cost should not fall to Montgomery County taxpayers, saying, "These developers should not get a break." A friendly revision from Vice President Balcom narrowed the amendment to prioritize evaluating whether financing the park through the district is feasible while retaining the planning board’s timing condition.

The committee also approved a second amendment to allow the TIF to fund certain transportation or LATIP projects located just outside the district boundary if those improvements meaningfully serve the development. Proponents said the change merely affirms existing Chapter 14 authority and provides flexibility in selecting projects that serve the district.

Staff and the county’s consultant, Municap, presented the TIF mechanics and fiscal work. Presenter Mr. Ali explained that tax increment financing would divert growth in property tax revenues from properties in the district to repay bond debt service; county staff emphasized that certain portions of the county property tax (including the MCPS share) are not diverted. Municap’s analysis and staff presentations supported a $420 million maximum bond authorization to be issued over multiple series, with the first series anticipated to be authorized in the fall of 2026 if the council proceeds.

Key numbers and program details presented to the committee included: the fiscal report’s maximum bond authorization of $420,000,000; an estimated Series A funding need for horizontal work in the first series of about $109,000,000; a county CIP entry of $40,000,000 for road construction (programmed to be reimbursable under staff presentations); a deferred transaction balance of roughly $32,000,000 tied to the General Development Agreement that can be credited for developer performance (staff said a portion of that balance is estimated to be credited leaving an effective acquisition cost to the developer of about $20,400,000); and staff’s statement that Montgomery County has already invested about $62.5 million in cleanup and related work for the site. Staff also summarized projected net fiscal impacts for Phase 1: roughly $33.1 million in new tax revenues by 2033 with an estimated net positive county impact of about $7.6 million under the reported assumptions, while noting those projections rely on conservative assumptions and are not forecasts.

Developers and project representatives described the proposed development as a town‑center‑first approach with horizontal site remediation and grading followed by phased vertical development. Theresa Stegman, vice president with MCB Real Estate, said the Montgomery‑County‑required 12.5% MPDUs would be distributed across unit types and provided an approximate unit mix for the phases presented to staff. Todd Foley of the Department of Finance clarified that Maryland law limits TIF diversion to property tax increment.

Staff identified notable risks including developer delays, insufficient tax increment relative to debt service (the county requires 1.25× coverage in projections), concentrated ownership in the district, market shifts in life‑science demand, and bond market risk; mitigants include series‑by‑series council authorization, capitalized interest accounts, debt service reserve funds, independent bond trustee controls and standard underwriting conditions.

Committee members repeatedly emphasized balancing project momentum for East County with protections for future residents, particularly park and transportation delivery. Several members said they supported the TIF as necessary under the "but‑for" analysis Municap and staff presented but pressed for clear expectations and enforcement tools for public amenities.

Next steps outlined by staff: if the full council approves the resolution, Department of Finance will work with the developer and Municap to prepare bond issuance documents and return to the council with a second resolution that authorizes specific bond series and amounts; each bond series would be accompanied by the fiscal analysis required under Chapter 14.

The joint committee approved the amended resolution unanimously and adjourned.