The County Council yesterday voted to raise a tax rate in order to provide additional funding for Montgomery County Schools construction and capital projects, as well as increase funding for rental assistance.
In a 7–4 vote, the council voted to increase the recordation tax premium rate while leaving the base rate and school implement rate unchanged.
“The recordation tax is a one-time cost that applies to the principal amount of debt secured by a mortgage or deed of trust when a house or building is purchased,” according to a press release.
“The recordation tax premium will increase from its current rate ($2.30 per $500) as follows: recordations between $600,000 and $750,000 will be charged $5.75 per $500; those more than $750,000 to $1 million will be charged $6.33 per $500; and those valued at more than $1 million will be charged $6.90 per $500,” the release continues.
The change is expected to raise $187.3 million over the six-year Capital Improvements Program, which covers fiscal years 2023 through 2028, and $52 million more for rental assistance over fiscal years 2024 through 2028. The new rates will be implemented on Oct. 1.
“This rate adjustment will help us keep our promises to communities badly in need of infrastructure improvements, from schools to transportation to public safety projects, while holding home buyers harmless at and below the median sale price in our county,” said Councilmember Kristin Mink (D–District 5), the lead sponsor of Bill 17-23, Taxation – Recordation Tax Rates – Amendments.
According to the release, “The Maryland Department of Legislative Services reports that recordation tax rates across the state range from a high of $7 per $500 transaction in Frederick County to a low of $2.50 per $500 transaction in Baltimore and Howard counties.”
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Council Updates Recordation Tax Rates to Increase Resources for School Construction, Montgomery County Construction Projects and Affordable Housing. 📰Read more: https://t.co/gcQhwK3oY3 pic.twitter.com/RTL5nUJNWr
— Montgomery Council (@MoCoCouncilMD) May 9, 2023
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