# Housing and Community Development (GHS)

## Title 6. Division of Neighborhood Revitalization

### Subtitle 9. Catalytic Revitalization Project Tax Credit

#### Section 6-901

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

(b) "Catalytic revitalization project" means the substantial rehabilitation of a property in the State:

  (1) that was formerly owned by the State or the federal government;

  (2) the rehabilitation of which will foster economic, housing, and community development within the community in which the property is located; and

  (3) that is out of service and was formerly used as a college or university, K-12 school, hospital, mental health facility, or military facility or installation.

(c) "Workforce housing" has the meaning stated in Sec. 4-1801 of this article.

#### Section 6-902

(a) An individual, a nonprofit organization, or a business entity may claim a tax credit in an amount equal to:

  (1) for a project issued a single tax credit certificate on completion, 20% of the amount stated in the final tax credit certificate issued by the Secretary under Sec. 6-903 of this subtitle for 5 consecutive taxable years beginning with the taxable year in which a final tax credit certificate is issued; or

  (2) for a phased project issued a tax credit certificate on completion of a phase, 100% of the amount stated in the final tax credit certificate issued by the Secretary under Sec. 6-903 of this subtitle for the taxable year in which the final tax credit certificate is issued.

(b) The Comptroller or the Secretary may not recapture a tax credit authorized under this subtitle if:

  (1) the catalytic revitalization project is transferred, in whole or in part, by fee simple transfer of real property or by transfer of an ownership interest in the entity that owns the project to a new owner; and

  (2) the Secretary has issued a final tax credit certificate for the catalytic revitalization project under Sec. 6-903 of this subtitle.

(c) The Secretary may issue multiple final tax credit certificates for a project that is issued an initial tax certificate under this section if:

  (1) the project has been determined by the Secretary to be in phases;

  (2) a phase of the project has been completed;

  (3) a final tax credit certificate is not issued for more than 20% of the project's eligible expenses to date; and

  (4) a final tax credit certificate is not issued that would exceed the aggregated limit of a project's credit under Sec. 6-903(b) of this subtitle.

#### Section 6-903

(a)

  (1) Subject to the limitations of paragraph (2) of this subsection and subsection (b) of this section, on application by an individual, a nonprofit organization, or a business entity, the Secretary shall issue:

    (i) an initial tax credit certificate in an amount equal to 20% of the individual's, nonprofit organization's, or business entity's estimated new construction costs and rehabilitation costs for the project; and

    (ii) on completion of the catalytic revitalization project or a phase of the catalytic revitalization project, a final tax credit certificate in an amount equal to 20% of the individual's, nonprofit organization's, or business entity's actual new construction costs and rehabilitation costs for the project.

  (2) For purposes of calculating the credit authorized under paragraph (1) of this subsection, new construction costs:

    (i) must be related to the construction of new structures that connect, expand, or integrate the existing structures to be rehabilitated; and

    (ii) may not exceed 50% of the total costs of the catalytic revitalization project.

(b)

  (1) Except as provided in paragraph (2)(ii) of this subsection, the Secretary may not:

    (i) accept applications and award initial credit certificates for catalytic revitalization projects more than once within a 2-year period; or

    (ii) issue tax credit certificates for credit amounts in the aggregate totaling more than $15,000,000 within a 2-year period.

  (2)

    (i) The Secretary may revoke an initial credit certificate on a finding by the Secretary that the recipient is not in compliance with the initial credit certificate or an agreement with the Department regarding the initial credit certificate.

    (ii) If the Secretary revokes an initial credit certificate under subparagraph (i) of this paragraph, the Secretary may award an initial credit certificate to another applicant, provided that the award does not exceed the amount of the revoked initial credit certificate.

(c) If the tax credit allowed under this subtitle in any taxable year exceeds the total tax otherwise payable by the individual, nonprofit organization, or business entity for that taxable year, the individual, nonprofit organization, or business entity may claim a refund in the amount of the excess.

(d) The credit allowed under this subtitle may be allocated among the partners, members, or shareholders of a business entity in any manner agreed to by those persons in writing.

(e)

  (1) The original recipient of an initial tax credit issued in accordance with this section may transfer the initial tax credit certificate to one or more other individuals, nonprofit organizations, or business entities.

  (2) The transfer of an initial tax credit certificate under paragraph (1) of this subsection need not involve a transfer of the catalytic revitalization project, whether by fee simple transfer of real property or a transfer of a portion or all of the ownership interest that the original recipient holds in the entity that owns the real property to a new owner or owners.

  (3) An initial tax credit certificate issued in accordance with this section may not:

    (i) be transferred to another person without the express written consent of the original recipient; or

    (ii) be transferred as part of the involuntary transfer of the real property ownership interest in an entity that owns the real property without the prior written consent of the original recipient of the certificate and the Secretary.

(f)

  (1) The amount of the tax credit stated in the final tax credit certificate that is allowed, but not claimed, under this subtitle may be transferred, by written instrument, in whole or in part, to any individual, nonprofit organization, or business entity.

  (2) For the taxable year of any transfer under this subsection, the transferee under paragraph (1) of this subsection may apply the tax credit against the total tax otherwise payable by the transferee in that taxable year.

  (3) If the tax credit exceeds the total tax otherwise payable by the transferee in any taxable year, the transferee:

    (i) may claim a refund in the amount of the excess;

    (ii) may carry forward and apply the excess credit for succeeding taxable years until the full amount of the credit is used; or

    (iii) may transfer the remainder of the tax credit to an individual, a nonprofit organization, or a business entity in accordance with paragraph (1) of this subsection.

#### Section 6-904

The Secretary, in consultation with the Department of Commerce, shall adopt regulations to carry out the provisions of this subtitle, including regulations that:

(1) establish procedures and standards for certifying new construction costs and rehabilitation costs under this subtitle;

(2) establish an application process for the issuance of tax credit certificates under this subtitle, with an emphasis on applications that promote affordable housing or workforce housing; and

(3) establish procedures for the approval of project phases for tax credit certificates issued under this subtitle.

#### Section 6-905

(a) Subject to subsection (b) of this section, this subtitle and the credit authorized under it shall terminate January 1, 2031.

(b) After the termination of this subtitle:

  (1) the Secretary may not issue any additional tax credit certificates under Sec. 6-903 of this subtitle; and

  (2) tax credit certificates issued may be claimed, refunded, carried forward, or transferred in accordance with Sec.Sec. 6-902 and 6-903 of this subtitle.

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