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Council members raise implementation and revenue concerns about demolition tax; DPS absence flagged

Government Operations and Fiscal Policy Committee (Montgomery County Council) · July 24, 2025
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Summary

Members questioned whether multiple exemptions and administrative burdens would shrink or eliminate revenue, asked for a clear homeowner exemption process and DPS staffing estimates, and noted comparisons to Evanston showed modest proceeds from similar fees.

Committee members endorsed the goal of increasing funding for affordable-housing production but raised repeated questions about administration, exemptions and realistic revenue expectations for Bill 5-25. Staff and the county attorneysuggested allowing DPS to issue regulations to implement exemptions and proposed adding a hardship exemption for owners who cannot meet a five-year owner-occupancy covenant due to unforeseen circumstances.

Council President Stewart and others emphasized the homeowner-facing process must be simple and clear, noting that recipients could otherwise receive unexpected tax bills. Councilmember Katz warned that a $20,000 fee could deter teardowns and cited Evanston, Ill., where a comparable fee generated only modest revenue (cited in discussion as roughly $60,000 annually). Several members said the Department of Permitting Services should have been present to explain administrative capacity; the committee asked staff to follow up on whether DPS needs additional personnel and to return staffing and implementation estimates before the bill advances.