Moore’s last housing bill finally receives House approval, but with significant changes

Early in the 2024 General Assembly session, Gov. Wes Moore (D) made clear that pushing legislation that worked to improve Maryland’s 96,000-unit housing shortage would be a top priority this year.

But one bill has straggled behind the rest of Moore’s housing package in the legislative process. House Bill 538, aiming to incentivize developers to add affordable housing options in future developments, lagged behind Moore’s other two housing-centered bills as lawmakers deliberated how to balance state oversight with acknowledging local authority over zoning laws.

The legislation finally cleared the House Thursday on a 98-36 vote, primarily along party lines, sending the bill off for Senate consideration mere days before the end of the legislative session on April 8.

“It’s a little later than usual in session, but we have plenty of time to get these bills through,” said Del. David Moon (D-Montgomery), majority leader for the House. “I think this is a small first step to try and put a dent in the housing crisis.”

HB 538 would require local jurisdictions to provide “density bonuses” for certain development projects that include affordable housing options. This would allow developers to exceed local density regulations so long as the new buildings offered a certain percentage of “affordable dwelling units.” In the bill, this refers to housing units that are affordable to households earning 60% or less of the area’s median income.

The zoning bill has gone through some changes during its time in the House through committee amendments. For one, the amount of affordable housing units needed to qualify for the density bonuses have been slashed.

The initial version of the bill would have provided a density bonus to developers who include at least 25% of affordable housing units within one mile of a rail station. But committee amendments dropped those qualifications to just needing 15% affordable housing units in the new development within three-quarters of a mile of a rail station to qualify for the density bonus.

A similar cut happened to a density bonus granted to non-profits that want to create new affordable housing units. Initially, the bill required that 50% of the new housing be affordable units in order for a non-profit to qualify for the density bonus. Now, only 25% of the units need to be affordable to qualify.

The bill also aims to incentivize developers of historic properties that were formerly owned by the state and were built at least 50 years ago. Those properties were initially required to have 50% of new housing be affordable, but committee amendments also cut the requirement to 25%.

Over the week, HB 538 led to robust debate on the House floor, as Republicans questioned whether the bill’s requirement of local jurisdictions to provide the density bonuses for affordable housing units oversteps the authority of local officials.

“This will circumvent local control,” Del. Seth Howard (R-Anne Arundel) said Thursday on the House floor.

Del. Mark N. Fisher (R-Calvert) focused on the housing shortage in Baltimore and argued that these are not the right incentives for people to want to move into the city.

Housing has been a priority this session for Moore and some lawmakers. How many bills will get through?

“There’s a pretty straightforward and easy solution to get people to move back into these houses, to a city that at one time had 1 million people plus, now has approximately half that and continues to bleed population,” Fisher said. “Well, maybe the state could cut property tax in half. Maybe the locals cut the property taxes, which are simply unsustainable. Maybe the streets could be policed better…and maybe we could have school choice for anyone that bought one of these houses.”

“I daresay that you’d would have a lot of people moving back into the city if we offered that…but instead we have this bill, which is doubling down on failure,” he said.

“It doesn’t solve the fundamental problem, the squalor that we’re seeing occurring in many parts of the state,” Fisher said. “To be fair, it’s not just in Baltimore.”

Moon said he was disappointed to see the discussion on the House floor focus so much on Baltimore when housing affordability is a widespread issue.

“I think it’s really unfortunate that some members of the minority party wanted to focus on Baltimore City when we have a housing crisis in all parts of the state at all income levels,” Moon said after the House convened for the day.

Moon is hopeful that the bill is “just the beginning” when it comes to addressing the state’s housing crisis.

“We’re very happy to stand with the governor in what I think is a pretty modest and reasonable step… to have the state put its thumb on the scale to help encourage affordable housing options,” Moon said.

He said that conversations with local officials have been a challenge in the process of getting the bill through the House.

“All the local governments have different zoning rules. And so by nature, anytime the state is going to step into zoning, it’s going to generate questions from all of our governments back home. I think a bill like this does take longer,” Moon said. “You’re going to get questions from all parts of the state, from all parties…people want reassurances about how this thing is going to look.”

“For the most part, it’s a local question, and every county, you have discussions and concerns about growth, development, and infrastructure.  I would venture to guess that this is true in Republican places, it’s true in Democratic places, it’s true in red and blue states. This is a fundamental tension of how we do public policy,” he said.