In this subtitle the following words have the meanings indicated. “Opportunity zone” means an area that has been designated as a qualified opportunity zone in the State under § 1400Z–1 of the Internal Revenue Code. “Qualified workforce housing project” means a workforce housing project in an opportunity zone that meets requirements for eligibility for the State tax credit as specified in regulations that the Secretary adopts under § 4–2502 of this subtitle. “State tax credit” means the income tax credit allowed under § 10–749 of the Tax – General Article. “Workforce housing” has the meaning stated in § 4–1801 of this title.

The owner of a qualified workforce housing project or the developer of a proposed project that will become a qualified workforce housing project may apply to the Secretary for allocation to the project of a portion of the State tax credit. An application under this section shall be made in the form and manner and contain any information that the Secretary requires by regulation. The Secretary may require that the owner of a qualified workforce housing project, as a condition to receiving an allocation of the State tax credit, enter into a written regulatory agreement with the Secretary under terms and conditions set by the Secretary, regarding the use of the project. The Secretary may require that any agreement required by the Secretary under this subsection be filed in the official land records of the county where the project is located. The Secretary and any local agency or authority designated by the Secretary may enforce an agreement required by the Secretary under this section in the event the owner fails to satisfy any of the requirements of the agreement. The Secretary may not require that the owner of a qualified workforce housing project, as a condition to receiving an allocation of the State tax credit, use the bonding authority of the State. The Secretary shall adopt: regulations or policies establishing criteria by which the State tax credit will be allocated among qualified workforce housing projects; and any other regulations necessary to administer the provisions of this subtitle. Any project that receives an allocation of a portion of the State tax credit shall be restricted in occupancy as specified in the regulations adopted by the Secretary under subsection (d) of this section for a period of at least 30 years beginning with the first taxable year in which a State tax credit is claimed by the owner.

The maximum aggregate available State tax credit that may be allocated for each fiscal year equals the lesser of: the amount appropriated for the Qualified Workforce Housing Tax Credit Reserve Fund for that fiscal year in the State budget as approved by the General Assembly; or $4,000,000. The Secretary may allocate the aggregate available State tax credit for a fiscal year among projects to be qualified workforce housing projects to be placed in service during or after that fiscal year. Any part of the aggregate available State tax credit for any fiscal year that is not allocated by the Secretary in that fiscal year may be carried over and allocated for any subsequent fiscal year. In this subsection, “Reserve Fund” means the Qualified Workforce Housing Tax Credit Reserve Fund established under paragraph (2) of this subsection. There is a Qualified Workforce Housing Tax Credit Reserve Fund. The Reserve Fund is a special, nonlapsing fund that is not subject to § 7–302 of the State Finance and Procurement Article. The money in the Reserve Fund shall be invested and reinvested by the State Treasurer, and interest and earnings shall be credited to the General Fund of the State. Except as otherwise provided in this subparagraph, for any fiscal year, the Secretary may not allocate tax credits under this subtitle in the aggregate totaling more than the amount appropriated for the Reserve Fund for that fiscal year in the State budget as approved by the General Assembly. If the aggregate credit amounts allocated in a fiscal year total less than the amount appropriated for the Reserve Fund for that fiscal year, any excess amount shall remain in the Reserve Fund and may be allocated for the next fiscal year. For any fiscal year, if funds are transferred from the Reserve Fund under the authority of any provision of law other than paragraph (4) of this subsection, the maximum credit amounts in the aggregate that the Secretary may allocate shall be reduced by the amount transferred. For each fiscal year, the Governor may include in the budget bill an appropriation for the Reserve Fund. Notwithstanding the provisions of § 7–213 of the State Finance and Procurement Article, the Governor may not reduce an appropriation for the Reserve Fund in the State budget as approved by the General Assembly. Except as provided in this paragraph, money appropriated for the Reserve Fund shall remain in the Reserve Fund. Within 15 days after the end of each calendar quarter, as to each qualified workforce housing project for which a final credit certificate was issued during the quarter, the Department shall notify the Comptroller of: the maximum credit amount initially allocated to the project; and the final certified credit amount for the project. On notification that the final credit for a project has been certified, the Comptroller shall transfer an amount equal to the credit amount initially allocated to the project from the Reserve Fund to the General Fund of the State.

On or before the last day of the taxable year in which a qualified workforce housing project that has been allocated a part of the State tax credit under this subtitle is placed in service, the owner shall: notify the Secretary that the project has been placed in service; and certify that the project is a qualified workforce housing project eligible for the State tax credit. Within 15 days after notification that a project has been placed in service, the Secretary shall issue to the owner a final credit certificate for the project stating the final credit amount for the project, not to exceed the credit amount initially allocated to the project. The Secretary shall: determine whether any event has occurred in violation of this subtitle or regulations adopted under this subtitle that makes the project ineligible for the State tax credit or otherwise triggers the recapture of any State tax credit as provided under § 10–749 of the Tax – General Article; and promptly notify the Comptroller of the occurrence of the event.

On or before December 31 each year, the Secretary shall report, in accordance with § 2–1257 of the State Government Article, to the General Assembly: the number of qualified workforce housing projects that received a tax credit allocation during the year; the number of housing units supported by each qualified workforce housing project that received a tax credit allocation during the year; a description of each qualified workforce housing project that includes: the geographic location of the project; demographic information on and income levels of the residents intended to be served by the project; and the rent that is authorized to be charged for a unit in the project; and housing market and demographic information that demonstrates how each qualified workforce housing project is addressing the need for workforce housing within the communities that the project is intended to serve.