The Montgomery County Council reached a new low this week, taking an action of fiscal irresponsibility so bonkers, it should cost them their seats in the 2026 election. They have approved legislation that will exempt any redevelopment of an office property into housing from property taxes for 20 years, if the new development provides 17.5% affordable units. Meanwhile, the same Council is planning a massive property tax increase for you, the residents of Montgomery County. Yes, this continues a pattern of shifting the tax burden from the Council's developer sugar daddies onto you, the struggling homeowner or business property owner. But it goes beyond almost any corrupt action they've taken before, as it could end up bankrupting the County, which is already under fiscal stress from a structural budget deficit and a massive debt load.
More Housing N.O.W. - a name that anyone who struggles to navigate closed streets and sidewalks around apartment tower construction sites in downtown Bethesda and Silver Spring would find laughable - is a legislative package cooked up by Councilmember Andrew Friedson (D - District 1). Loaded with developer giveaways, it appears to have been written by the developers themselves. Much like their plan to gift developers land taxpayers paid to acquire for a critical highway the Council canceled, forgoing billions in tax revenue and shifting the tax burden to you is a dereliction of duty by the Council.
Why would Friedson bring forward such an audaciously-corrupt tax break for developers? He's running for County Executive, and needs the money developers so generously provide to each of the current Councilmembers. And it's going to take a lot of money to win, especially if David Blair decides to take a third shot at the County Executive office in 2026. The seat is essentially Blair's for the taking, having lost by a handful of votes to Marc Elrich each of the previous times he ran. None of the candidates running next year have Elrich's name recognition, base of support, or voter goodwill that crosses party and demographic lines.
But barring Blair's entry into the field, developers will support Friedson. How did the unknown Friedson defeat the far-more-qualified and known former Kensington Mayor Peter Fosselman and the legendary Ana Sol Gutierrez, the first Latina ever elected to public office in Maryland, in a Democratic primary? It's not entirely clear even today, but the developer money didn't hurt. Developers haven't just mailed the checks to Friedson's campaign - they actually host fundraisers for him at their mansions.
More Housing N.O.W. is similar to another legislative victory developers enjoyed during the previous Council term, in that it simply juices the profits for development that would already happen without it. That was the bill that gave a 15-year property tax exemption (sound familiar?) to developers building residential housing on WMATA-owned land at Metro stations. Not only had such development taken place previously without this outrageous tax-free provision, but it was demanded by a development firm that had already committed to a project before attempting - and succeeding - in getting the Council to provide this tax exemption as a sweetener. Imagine their shocked and surprised delight when the knees of the Council buckled so easily to deliver such a windfall of cash, on top of the already massive profits they would be raking in.
It's no surprise they went back to the well again. After all, this Council is the biggest bunch of pushovers yet for their developer sugar daddies. The public is almost entirely unaware that this robbery of the public coffers is taking place. Or that they might be spending over $1000 more on their own property taxes next year, if they live anywhere in Bethesda, Chevy Chase, Potomac, or parts of Kensington, Silver Spring, Rockville, or even Aspen Hill. Because if your home is valued at $1 million or more, that's how much your property tax bill will be going up under the tax hike currently before the Council.
Why would the tax exemption approved Tuesday potentially bankrupt the County, and/or require your property taxes to reach unimaginable heights in the coming decades?
First and foremost, we already know that residential housing generates more new costs in public services and infrastructure than it does in property tax revenue. That, along with the County Council's out-of-control spending this century, and anti-business policies that have scared companies away from locating here, is what has created our structural budget deficit in the first place. Now imagine what the deficits will be if a majority of new apartment buildings will be paying no property taxes at all for 20 years!
Second, the legislation has a misleading talking point behind it. Most people think of "office to housing conversion" as the reconfiguration of an office building into apartment or condo-sized residential units. But the package approved Tuesday provides the same 20-year tax exemption and expedited approval for demolishing an office building, and constructing an entirely new residential building in its place.
Third, because of the allowance for demolitions, the 20-year tax exemption will apply to a huge number of projects that were - or will be - planned without the More Housing N.O.W. developer giveaways in place. In fact, a large percentage of the new buildings constructed since the "Great Recession" have been built on the ashes of office buildings that were demolished to make way for them.
We've seen that even true office-to-housing conversions have taken place without these outlandish incentives, include a new condo development and new apartment property in downtown Silver Spring. Now think about all the other apartment and condo buildings that were torn down for residential over the last 15 years alone, where the developers did not demand a 20-year property tax exemption. Gallery Bethesda I and II, Sophia Bethesda, 4909 Auburn, Stonehall Bethesda, The Wilson/The Elm (7272 Wisconsin Avenue), 8001 Woodmont, Hampden House, The Met Rockville, AVA Wheaton, and the Fairchild Apartments in Germantown are just a few examples of post-"Great Recession" redevelopments of office properties.
Imagine if all of these were paying no property taxes for 20 years! Now realize that the long-anticipated redevelopment of the massive GEICO campus in Chevy Chase - to name just one mega project - will bring in ZERO property tax revenue to County coffers for 20 years! This is criminal.
The good news is, it's not too late to stop the madness. You can stop the More Housing N.O.W. legislation by calling or emailing your Councilmember, and all of the At-Large Councilmembers, and telling them you want no more developer giveaways. It's very easy: the Council website shows all of the Councilmembers, and there's even a tool to help you learn who your district member is (the At-Large members also all represent you, which is why you want to contact all of them, as well).
County Executive Marc Elrich is expected to veto the More Housing N.O.W. legislation when it reaches his desk. The County Council will then have to override the veto to save the developers' 20-year property tax exemption. Tell your Councilmember you will vote them out, and you certainly won't vote to promote them to County Executive if they are running for that office, if they vote to override Elrich's veto. If for some crazy reason Elrich were to sign the tax break - or let it become law by not signing it - let the Council know you will vote them out just the same, if they don't repeal it.
You can also stop the massive property tax increase by telling your Councilmember at the same time that you will vote them out if they vote to raise your property taxes again this year or next year. And if they do - VOTE THEM OUT! You don't even have to vote for a Republican; you can just vote for the new Democrats who are running against the incumbents in the primary next year. But if they squeak through again to the general election, you have to seriously consider voting for any Republican, Green, or other party challenger who remains in their way. It's the inability to vote out the Council that has led to their outrageous misbehavior.
Are you really going to vote again for the politicians who insiders say refer to you as "losers" and "suckers" in private, willing to pay any tax, accept any reduction in your quality of life, and countenance the totally incompetent leadership they dish out?
The voters of Montgomery County need to wake up. Some of you are awake and on-the-ball. That's likely why you are reading this article now in the first place. But it's not enough. I worry about some of the other residents in this county. What will it take for you wake up and rise up against the Montgomery County cartel and its handpicked Councilmembers, who have held a majority on the Council since 2002?
You've gotten a property tax hike every year except for FY-2015, when you received a tax "cut" of about $12. The next year, the Council dropped a 9% property tax increase anvil on you like Wile E. Coyote. They seemed to pay a price for that, when voters approved term limits a few months later in 2016. But...when it came to the 2018 Council election, the cartel's candidates won every seat again. Much like their victory over the Columbia Country Club with the Purple Line, they realized they could get away with anything, and you wouldn't do a thing about it come Election Day. Invincibility. Absolute power. Such things do not a Republic make.
One of the greatest political cartoons of all time that sums up this phenomenon once ran in The Gazette. It showed a Montgomery County voter bending over in front of then-County Executive Doug Duncan, who was wielding a large paddle with the words "tax hike" on it. The voter, with his head crooked around to look back toward Duncan, said, "Thank you, Sir. May I have another?"
Don't be that guy anymore. It's not a good look. It's a sad state of affairs, really. Break smelling salts under your nose, if you have to.
You're mad as hell, and you're not going to take it anymore. Go to the Council website. Pick up the phone, fire up the email, and let them know, "Enough is enough!" No 20-year property tax exemption for developers, and no property tax hikes for you.
