# Housing and Community Development (GHS)

## Title 6. Division of Neighborhood Revitalization

### Subtitle 7. National Capital Strategic Economic Development Program

#### Section 6-701

(a) In this subtitle the following words have the meanings indicated.

(b) "Community development financial institution" has the meaning stated in 12 U.S.C. Sec. 4702.

(c) "Community development organization" means an entity that meets the requirements under Sec. 6-704 of this subtitle.

(d)

  (1) "Financial assistance" means a grant, a loan, or an investment provided under this subtitle.

  (2) "Financial assistance" includes:

    (i) an assurance;

    (ii) a guarantee;

    (iii) a prepayment of interest on a subordinate or superior loan or portion of a loan;

    (iv) a reduction in the principal obligation of or rate of interest payable on a loan or a portion of a loan; and

    (v) any other form of credit enhancement.

(e) "National capital region" means the areas of the State located within a sustainable community in Montgomery County or Prince George's County.

(f) "Program" means the National Capital Strategic Economic Development Program.

(g) "Sustainable community" means an area designated as a sustainable community under Sec. 6-205 of this title.

#### Section 6-702

(a) There is a National Capital Strategic Economic Development Program.

(b) The Department shall administer the Program.

(c) The purpose of the Program is to:

  (1) provide strategic investment in local housing and businesses to encourage healthy, sustainable communities with a growing tax base and enhanced quality of life; and

  (2) focus on areas where modest investment and coordinated strategies will have an appreciable neighborhood revitalization impact.

#### Section 6-703

(a) The community enhancement projects eligible to receive Program funds include:

  (1) down payment assistance for homebuyers to purchase and rehabilitate homes;

  (2) programs to acquire or rehabilitate vacant or blighted properties;

  (3) programs to improve existing residential and business properties;

  (4) programs to achieve energy efficiency through weatherization and energy retrofits;

  (5) development of affordable housing;

  (6) development of mixed-use projects that combine housing, retail, and office space;

  (7) development or enhancement of community open space or public infrastructure;

  (8) workforce and employment development programs, when associated with other projects listed under this subsection;

  (9) career and technical education and apprenticeship programs, when associated with other projects listed under this subsection; and

  (10) strategic demolition.

(b) Program funds may be used for operating costs necessary to implement a community enhancement project.

(c) The Secretary may establish additional community enhancement projects eligible to receive Program funds.

#### Section 6-704

(a)

  (1) A government agency, including a housing authority, with jurisdiction in the national capital region, an entity controlled directly or indirectly by a housing authority that operates in the national capital region, and, subject to paragraph (2) of this subsection, a community development organization are eligible to apply for program funds.

  (2) A corporation, a foundation, or any other legal entity is a community development organization eligible to apply for Program funds if:

    (i) the purpose of the organization is to implement a clear revitalization strategy in a neighborhood or set of neighborhoods within the national capital region; and

    (ii) no part of the organization's net earnings inures to the benefit of a private shareholder or an individual holding an interest in the entity.

(b) The eligible institution's application must contain a neighborhood revitalization plan that includes community enhancement projects located within a sustainable community.

(c) An eligible institution may apply with another eligible institution or with a community development financial institution that has the capacity and experience to assist in the financing of real estate projects within the community.

(d) The community enhancement projects for which an eligible institution applies for Program funds may be located in more than one political subdivision.

#### Section 6-705

(a)

  (1) A government agency, including a housing authority, with jurisdiction in the national capital region, an entity controlled directly or indirectly by a housing authority that operates in the national capital region, and a community development organization may apply to the Department to receive Program funds for community enhancement projects.

  (2) The Department shall establish the application process.

  (3) The application shall contain:

    (i) the neighborhood revitalization plan;

    (ii) a description of each community enhancement project;

    (iii) organizational documents for the community development organization; and

    (iv) any other information the Department requires.

(b)

  (1) The Department, by regulation, shall establish a quantitative system to evaluate each application.

  (2) The quantitative evaluation system shall evaluate each application based on:

    (i) the neighborhood revitalization plan and how the plan relates to the goals outlined in the community's larger sustainable communities plan;

    (ii) the description of the community conditions and the appropriateness of outlined strategies to address those conditions;

    (iii) the ability of each proposed community enhancement project to address identified challenges within the community; and

    (iv) the capacity and experience of the applicant and the applicant's partners to complete the proposals and leverage additional financing.

(c) The Department may give additional consideration to applications that include:

  (1) opportunities that promote compact redevelopment and connect housing and job opportunities with transportation options;

  (2) activities in specially designated districts that encourage residential reinvestment that reinforces the success of the businesses in the districts;

  (3) community enhancement projects that encourage or incorporate elements that address environmental responsibility and stewardship into the site and project development, design, and construction;

  (4) community enhancement projects that incorporate additional State and local revitalization and smart growth programs and financing tools;

  (5) capital investments and business practices that incorporate inclusionary hiring practices that increase local workforce opportunities; and

  (6) projects whose purpose is to identify for acquisition, acquire, develop, or promote the development of vacant or blighted properties.

#### Section 6-706

(a) The Department shall:

  (1) review each application submitted under Sec. 6-705 of this subtitle and may request additional information from the applicant;

  (2) accept public input on each application; and

  (3) consider the recommendation of any State unit.

(b)

  (1) The Department may not approve an application until the Department has provided written notice and a reasonable opportunity to comment to the political subdivision where the proposed community enhancement project is located.

  (2) If the application affects a neighborhood entirely within a municipal corporation, the Department must provide notice and a reasonable opportunity to comment to the municipal corporation and not the surrounding county.

  (3) If an application affects a neighborhood within more than one political subdivision, the Department must provide notice and a reasonable opportunity to comment to each political subdivision.

(c) The Secretary shall, subject to subsection (b) of this section, award financial assistance to an applicant:

  (1) in the amount and of the type that the Secretary determines; and

  (2) under the terms of a Program agreement.

#### Section 6-707

(a) The Department and a recipient of financial assistance from the Program shall execute a Program agreement.

(b) The recipient of financial assistance from the Program shall comply with the terms of the Program agreement.

(c) The Program agreement may not allow for more than 40% of the total financial assistance that the Program provides to be used for operating expenditures.

(d) The Department may exercise any remedy provided under the Program agreement or by law if the recipient of financial assistance from the Program:

  (1) violates any provision of the agreement; or

  (2) ceases to meet any requirement of this subtitle.

#### Section 6-708

(a) The Department has the powers necessary to implement the Program.

(b)

  (1) The Department may determine the terms and conditions for or establish time limits for the use of financial assistance awarded under this subtitle.

  (2) The financial assistance awarded under this subtitle may be secured by a mortgage, a lien, or any other security interest that is superior to or subordinate to other mortgages, liens, or other security interests.

(c)

  (1) The Department may, subject to any limits imposed by law, enforce the terms and conditions of the financial assistance awarded under this subtitle.

  (2) If any financial assistance awarded under this subtitle is secured by a first or subordinate mortgage or other lien, the Department may, subject to any limits imposed by law:

    (i) begin an action to protect or enforce any right given by law, contract, or other agreement;

    (ii) foreclose on property;

    (iii) purchase property at any foreclosure or other sale, or acquire or take possession of the property through conveyance in lieu of foreclosure or otherwise, and convey property after acquiring it;

    (iv) settle or compromise any debt or obligation owed to the Department;

    (v) pay the principal of and interest on any obligation incurred in connection with the property and dispose of or otherwise deal with the property to protect the interests of the Program; or

    (vi) release or sell any mortgage, obligation, or property that the Department holds at public or private sale, with or without public bidding.

(d)

  (1) The Department may contract with any person or governmental unit for property or services necessary to operate the Program.

  (2) The Department may contract for and accept any grant, contribution, or loan of money, property, or other aid from the federal government and may do all things consistent with this subtitle to qualify for the aid.

(e) In connection with any loans that the Department makes, the Department may:

  (1) require and obtain appraisals, credit information, and other pertinent information; and

  (2) charge interest.

(f) The Department may consent to the modification of any provision of a Program agreement if the modification is in the best interest of the Program.

#### Section 6-709

(a) The recipient of financial assistance from the Program shall submit to the Department quarterly progress reports on the development of a community enhancement project.

(b)

  (1) On or before October 31 each year, the Department shall submit a report to the Governor and, subject to Sec. 2-1257 of the State Government Article, the General Assembly.

  (2) The report shall include, for the previous fiscal year:

    (i) the number of applications received;

    (ii) the number and location of community enhancement projects;

    (iii) the financial status of the Program, including the amount and types of financial assistance encumbered and disbursed; and

    (iv) a summary of the quarterly reports submitted under subsection (a) of this section.

#### Section 6-710

(a) In this section, "Fund" means the National Capital Strategic Economic Development Fund.

(b) There is a National Capital Strategic Economic Development Fund.

(c) The purpose of the Fund is to provide financial assistance under the Program.

(d) The Department shall administer the Fund.

(e)

  (1) The Fund is a special, nonlapsing fund that is not subject to Sec. 7-302 of the State Finance and Procurement Article.

  (2) The State Treasurer shall hold the Fund separately, and the Comptroller shall account for the Fund.

(f) The Fund consists of:

  (1) money appropriated in the State budget to the Fund;

  (2) interest earnings of the Fund; and

  (3) any other money from any other source accepted for the benefit of the Fund.

(g) Subject to subsection (k) of this section, the Fund may be used only for providing financial assistance under the Program.

(h)

  (1) The State Treasurer shall invest the money of the Fund in the same manner as other State money may be invested.

  (2) Any interest earnings of the Fund shall be credited to the Fund.

(i) Expenditures from the Fund may be made only in accordance with the State budget.

(j)

  (1) For fiscal year 2021 and each fiscal year thereafter, the Governor shall include in the annual operating budget an appropriation for the Fund in the amount of $200,000.

  (2) For fiscal years 2021 through 2024, the Governor shall include in the annual operating or capital budget an appropriation for the Fund in the amount of $7,000,000.

  (3) For fiscal year 2025 and each fiscal year thereafter, the Governor shall include in the annual operating or capital budget an appropriation for the Fund in the amount of $12,000,000.

(k) The Fund may be used only for community enhancement projects in sustainable communities located:

  (1) in Prince George's County, at least in part, within the boundary created by Interstate 495 in the State and the District of Columbia; or

  (2) in Montgomery County, within an enterprise zone or the boundary created by:

    (i) Prince George's County;

    (ii) Maryland Route 200;

    (iii) Interstate 270;

    (iv) Interstate 495 to the Maryland state line; and

    (v) the District of Columbia.

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Md. Code Ann., Hous. & Cmty. Dev. (as displayed at mgaleg.maryland.gov, October 16, 2026)