Title 12. Local Development Authorities and Resources — Subtitle 6. Montgomery County -- Business Improvement Districts
Statutes in effect as of October 1, 2026.
Md. Code Ann., Econ. Dev. § 12-601 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–601LinkCopy Citation
(a)
In this subtitle the following words have the meanings indicated.
(b)
“Board” means the board of directors of a district corporation.
(c)
“Commercial tenant” means a lessee or other lawful occupant, other than the owner, of nonexempt property within a district.
(d)
“Condominium” has the meaning stated in § 11–101 of the Real Property Article.
(e)
“Cooperative housing corporation” has the meaning stated in § 5–6B–01 of the Corporations and Associations Article.
(f)
“District” means a business improvement district established under this subtitle.
(g)
“District corporation” means a business improvement district corporation formed in accordance with this subtitle.
(h)
“Homeowners association” has the meaning stated in § 11B–101 of the Real Property Article.
(i)
“Members of the district” means owners of nonexempt property and commercial tenants in the district.
(j)
“Nonexempt property” means all real property that is not exempt from paying real property taxes except:
(1)
condominium units and cooperative housing corporation units that exist on or before the date of establishment of a district;
(2)
homeowners associations; or
(3)
residential property with fewer than four dwelling units.
Md. Code Ann., Econ. Dev. § 12-602 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–602LinkCopy Citation
The legislative purposes of this subtitle are to:
(1)
provide for the creation of business improvement districts within Montgomery County; and
(2)
promote the general welfare of the residents, employers, employees, property owners, commercial tenants, consumers, and the general public within the geographic area of the business improvement districts.
Md. Code Ann., Econ. Dev. § 12-603 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–603LinkCopy Citation
This subtitle applies only in Montgomery County.
Md. Code Ann., Econ. Dev. § 12-604 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–604LinkCopy Citation
(a)
Subject to a public hearing under § 12–609 of this subtitle and to accomplish a legislative purpose listed in § 12–602 of this subtitle, the governing body of the county or a municipal corporation in the county may adopt a local law to create a business improvement district in accordance with this subtitle.
(b)
Subsection (a) of this section is self–executing and fully authorizes the county or a municipal corporation in the county to establish a district, notwithstanding any other statutory or charter provision.
(c)
A local law adopted under subsection (a) of this section shall include:
(1)
the name of the district corporation;
(2)
that the district corporation is formed under this subtitle;
(3)
the names, addresses, and terms of office of the initial members of the board of directors of the district corporation;
(4)
the address of the principal office of the district corporation;
(5)
the purposes for which the district is formed;
(6)
the powers of the district, subject to the limitations on the powers of districts under this subtitle; and
(7)
if applicable, articles of incorporation of the district corporation.
Md. Code Ann., Econ. Dev. § 12-605 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–605LinkCopy Citation
(a)
A board of directors shall govern the district corporation.
(b)
(1)
Subject to paragraphs (2) and (3) of this subsection:
(i)
except as provided in item (ii) of this paragraph, the board of a district corporation consists of at least 11 members; or
(ii)
the governing body of the county or a municipal corporation in the county in which a district is established may determine a different number of members for the board if the district is connected with a business improvement district in another county, state, or in the District of Columbia.
(2)
Subject to paragraph (3) of this subsection, appointment procedures shall be provided in the local law establishing the district.
(3)
(i)
Owners of nonexempt property shall elect owner members.
(ii)
(1)
Commercial tenants shall elect commercial tenant members in accordance with an election process that is established by the governing body of the county or a municipal corporation in the county in which the district is located.
(2)
To the extent practicable, the election process shall reflect the diversity of businesses and other organizations in the district.
(c)
From among its members, the board shall elect a chair and other officers.
(d)
(1)
A majority of the voting members of the board is a quorum.
(2)
The board may act on a resolution only by the affirmative vote of a majority of the voting members.
(e)
A member of the board:
(1)
may not receive compensation as a member of the board; but
(2)
shall be reimbursed for expenses incurred in performing the member’s duties.
(f)
The board shall exercise its powers by resolution.
(g)
The board shall file an annual report with the governing body of the county or a municipal corporation in the county that includes:
(1)
a financial statement for the preceding year;
(2)
a proposed operating budget for the current fiscal year;
(3)
any proposed revisions to the business plan; and
(4)
a narrative statement or chart showing the results of operations in comparison to stated goals and objectives.
Md. Code Ann., Econ. Dev. § 12-606 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–606LinkCopy Citation
The net earnings of a district corporation may benefit only the district corporation.
Md. Code Ann., Econ. Dev. § 12-607 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–607LinkCopy Citation
(a)
(1)
Except as limited by its articles of incorporation, a district corporation has all the powers set forth in this subtitle.
(2)
A district corporation may:
(i)
receive money from its incorporating county or municipal corporation, the State, other governmental units, or nonprofit organizations;
(ii)
charge fees for its services;
(iii)
have employees and consultants as it considers necessary; and
(iv)
use the services of other governmental units.
(b)
A district corporation shall operate and exercise its powers solely to accomplish one or more of the legislative purposes of this subtitle.
Md. Code Ann., Econ. Dev. § 12-608 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–608LinkCopy Citation
(a)
The owners of nonexempt property who seek to establish a district corporation shall submit appropriate documentation as described in subsection (b) of this section to:
(1)
the governing body of the county; and
(2)
if the proposed district is located within a municipal corporation in the county, the governing body of the municipal corporation.
(b)
The appropriate documentation required under subsection (a) of this section shall contain:
(1)
a statement setting forth:
(i)
the proposed name and address of the district corporation; and
(ii)
the street address of each owner of nonexempt property and to the extent reasonably ascertainable, each commercial tenant within the proposed district;
(2)
a statement expressing the intent to establish a district corporation that is signed by:
(i)
owners of at least 51% interest in the assessed value of the nonexempt property and, subject to subsection (c) of this section, a designated board member of a condominium or cooperative housing corporation within the proposed district; and
(ii)
owners of at least 51% of the total number of parcels of nonexempt property and, subject to subsection (c) of this section, a designated board member of a condominium or cooperative housing corporation within the proposed district;
(3)
a proposed 3–year business plan that contains:
(i)
the goals and objectives of the proposed district;
(ii)
the annual proposed business improvement district tax for the proposed district’s common operations and the formula used to determine each member’s district tax; and
(iii)
the maximum amount and the nature of start–up costs incurred before the district’s establishment;
(4)
a tax assessor’s map of the geographic area of the proposed district;
(5)
a list of the proposed initial board of the proposed district corporation;
(6)
the proposed articles of incorporation and the bylaws of the district corporation; and
(7)
for all nonexempt property within the proposed district:
(i)
the name and mailing address of each owner; and
(ii)
the most recent assessed value.
(c)
(1)
Notwithstanding any other provision of this title, subject to paragraph (2) of this subsection, a condominium or cooperative housing corporation that is located in the proposed district may petition to join the district corporation.
(2)
A condominium or cooperative housing corporation described under paragraph (1) of this subsection may petition to join the district only if:
(i)
the condominium or cooperative housing corporation is governed by a board;
(ii)
the board votes to join the district corporation; and
(iii)
the board has a representative member of the board sign the appropriate documents required under subsection (b)(2) of this section.
(3)
For the purposes of the votes cast under subsection (b)(2) of this section:
(i)
a condominium or cooperative housing corporation shall be considered a single parcel; and
(ii)
the decision reached by the board shall constitute the vote of the condominium or cooperative housing corporation.
(d)
Within 45 days after receiving all appropriate documentation under subsection (b) of this section, the governing body of the county or a municipal corporation in the county shall schedule a public hearing on the application.
Md. Code Ann., Econ. Dev. § 12-609 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–609LinkCopy Citation
(a)
At least 21 days before the public hearing, the governing body of the county or a municipal corporation in the county shall publish notice of the public hearing in a newspaper of general circulation within the geographic area of the proposed district.
(b)
The owners of nonexempt property who seek to establish a district shall send notice of the public hearing and a summary of the application to each owner and, to the extent reasonably ascertainable, each commercial tenant of nonexempt property within the proposed district at least 90 days before the public hearing or when owners of at least 20% of the total number of parcels of nonexempt property express the intent to establish a district, whichever is earlier.
(c)
Before the public hearing, the application shall be made available for review during normal business hours in at least one location in the proposed district.
(d)
Within 10 days after the public hearing, if the governing body of the county or a municipal corporation in the county determines, in the sole discretion of the governing body, that the needs of the district meet a purpose of this subtitle, the governing body may authorize the district in accordance with § 12–604 of this subtitle.
Md. Code Ann., Econ. Dev. § 12-610 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–610LinkCopy Citation
(a)
Within 10 days after the authorization of the district by the governing body of the county or a municipal corporation in the county, the district corporation shall provide the governing body of the county or a municipal corporation in the county with a preliminary business improvement district tax roll.
(b)
(1)
The governing body of the county or a municipal corporation in the county shall impose a business improvement district tax to provide funds for the operation of the district.
(2)
The governing body of the county or a municipal corporation in the county shall impose on members of the district who are owners of nonexempt property the district tax at a rate specified by the board and approved by the governing body.
(3)
The tax imposed under this subsection may not count against a county or municipal corporation tax cap.
(c)
The district tax shall be collected in the same manner as real property taxes are collected and distributed each quarter to the district.
(d)
A district shall reimburse the governing body of the county or a municipal corporation in the county for the costs incurred in collecting the district tax.
Md. Code Ann., Econ. Dev. § 12-611 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–611LinkCopy Citation
(a)
An established district may expand the geographic area of the district if:
(1)
a petition for inclusion is submitted from:
(i)
owners of at least 51% interest in the assessed value of the nonexempt property and, subject to subsection (b) of this section, a designated board member of a condominium or cooperative housing corporation proposed for inclusion in the district; and
(ii)
owners of at least 51% of the total number of parcels of nonexempt property and, subject to subsection (b) of this section, a designated board member of a condominium or cooperative housing corporation proposed for inclusion in the district;
(2)
the petition under item (1) of this subsection is accepted by a majority vote of the board of the district corporation; and
(3)
the appropriate documents, as applicable, are submitted under § 12–608 of this subtitle and a hearing is held under § 12–609 of this subtitle.
(b)
(1)
Notwithstanding any other provision of this title and subject to paragraph (2) of this subsection, a condominium or cooperative housing corporation that is located in the proposed expanded geographic area of the district may petition to join the expansion.
(2)
A condominium or cooperative housing corporation described under paragraph (1) of this subsection may petition to join the expansion only if:
(i)
the condominium or cooperative housing corporation is governed by a board;
(ii)
the board votes to join the district corporation; and
(iii)
the board has a representative member of the board sign the appropriate documents required under § 12–608 of this subtitle.
(3)
For the purposes of the votes cast under subsection (a)(1) of this section:
(i)
a condominium or cooperative housing corporation shall be considered a single parcel; and
(ii)
the decision reached by the board shall constitute the vote of the condominium or cooperative housing corporation.
Md. Code Ann., Econ. Dev. § 12-612 (2026)
Title 12. Local Development Authorities and Resources
Subtitle 6. Montgomery County -- Business Improvement Districts
§ 12–612LinkCopy Citation
(a)
The governing body of the county or a municipal corporation in the county in which a district is established under this subtitle shall:
(1)
review the effectiveness and desirability of continuing the district every 3 years from the time the district is authorized by local law under § 12–604 of this subtitle; and
(2)
develop policies and procedures for evaluating the desirability of continuing the district if requested by members of the district.
(b)
If the continuing existence of the district is not approved by the governing body:
(1)
the district shall cease to exist as directed by the governing body; and
(2)
the district corporation shall continue its existence only as long as necessary to terminate operation in a reasonable manner.