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bolt —
ChairmanPhilMendelson
ABILL
IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
ToamendTitle47oftheDC OfficialCodetoprovideformoretimelyclassificationchangesfor
commercialpropertiesthataretobeputtoresidentialuse;toprovideforanapplication
processtomakeclassificationchanges;toprovideforappealrightsifsuchapplicationis
denied;andtoprovideforaclawbackintheeventtherealpropertyisnottimelyputto
residentialuse.
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
actmay be citedas the“ResidentialBuildingPermitClassificationAmendment Act of 2025”.
Sec.2.Section47-813 of theDistrictof Columbia OfficialCode isamended to readas
follows:
(a)Subsection(c-9)(2)isamended as follows:
(1)Subparagraph(A)isamendedtoreadasfollows:
“(A)Exceptasotherwiseprovidedinthisparagraphandsubjectto
paragraphs(4)and(5)ofthissubsection,Class1APropertyshallbecomprisedof:?
“(i)Residentialrealpropertythatisimprovedanditslegaluseis
fornontransientresidentialdwellingpurposes,and thatisnot Class 1B Property;provided,that
such propertymay be used tohosttransientguestspursuanttoan unexpiredshort-termrental
licenseendorsementissuedpursuantto§30-201.04;or
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“(ii) Real property or a portion of real property for which a 34
building permit has been issued: 35
“(I) To construct a new improvement for predominantly 36
nontransient residential dwelling purpose; or 37
“(II) To substantially rehabilitate that portion or all of an 38
existing improvement for exclusively nontransient residential dwelling purposes.”. 39
(2) Subparagraph (C) is amended by striking the phrase “designated as” and 40
inserting the phrase “designated solely as” in its place. 41
(b) The lead-in language of subsection (d-2) is amended by striking the phrase “Class 3 42
Property or Class 4 Property,” and inserting the phrase “Class 2 Property, Class 3 Property, or 43
Class 4 Property,” in its place. 44
(c) A new subsection (d-3) is added to read as follows: 45
“(d-3)(1) If real property changes classification to Class 1A Property as defined in 46
subsection (c-9)(2)(A)(ii) during the period: 47
“(A) October 1 through March 31 of the tax year, the newly reclassified 48
Class 1A Property, or the portion thereof used exclusively for residential purposes if already 49
improved or assessed under § 47-829, shall be taxed at the Class 1A Property tax rate for the 50
entire tax year; or 51
“(B) April 1 through September 30 of the tax year, the newly reclassified 52
Class 1A Property, or the portion thereof used exclusively for residential purposes if already 53
improved or assessed under § 47-829, shall be taxed at the Class 1A Property tax rate for the 54
second installment only. 55
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“(2) The owner shall apply for a change of classification to Class 1A Property as 56
defined in subsection (c-9)(2)(A)(ii) of this section and shall promptly provide complete 57
documentation in a manner prescribed by the Chief Financial Officer to substantiate any such 58
classification change before it shall be effective. 59
“(3) A change in classification to Class 1A Property as defined in subsection (c-60
9)(2)(A)(ii) of this section shall be effective beginning in the half tax year for which application 61
is made under paragraph (2) of this subsection. 62
“(4) If change in classification to Class 1A Property as defined in subsection (c-63
9)(2)(A)(ii) of this section is determined to be erroneous because the real property was not put to 64
predominantly residential use by the earlier of either the issuance of any new or amended 65
certificate of occupancy (temporary or permanent) for any part of the improvement thereon, or 3 66
years from issuance of the building permit, or the building permit expired and was not renewed 67
within 1 year, the Chief Financial Officer shall reclassify and tax the real property without 68
limitation for each tax year or half tax year in which the real property was improperly classified 69
as Class 1A Property, subject only to subsection (d-1)(5)(A-i) of this section if the property is 70
determined to be Class 3 Property or Class 4 Property, or subsection (d-2) of this section. In the 71
event of such reclassification, penalty and interest shall be added beginning from the day the 72
correct amount of tax should have been due but not paid if the property had been properly 73
classified. 74
“(5) Within 45 days from the date of the notice of denial of Class 1A Property 75
reclassification under this paragraph of this subsection, the owner may petition for an 76
administrative review of the rescission or denial and appeal from a final determination thereof to 77
the same extent as if the appeal were filed under § 47-825.01a(d)(2). 78
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“(6) Notwithstanding the time limitations in paragraphs (4) and (5) of this 79
paragraph, the Chief Financial Officer, in his or her discretion, may grant an extension of time to 80
comply or waive penalty and interest assessed pursuant to paragraph (4) of this subsection to 81
prevent an undue hardship to the owner. 82
“(7) The provisions of this subsection, subsection (c-9)(2)(A)(ii) of this section, 83
and § 47-829 shall not supersede the requirement to timely file for mixed-use classification for 84
the upcoming tax year pursuant to subsection (f) of this section, when the annual assessment for 85
such upcoming tax year is made under § 47-824 and the certificate of occupancy (final or 86
temporary) was issued.”. 87
Sec. 3. Applicability. 88
This act shall apply as of April 1, 2025. 89
Sec. 4. Fiscal impact statement. 90
The Council adopts the fiscal impact statement in the committee report as the fiscal 91
impact statement required by section 4a of the General Legislative Procedures Act of 1975, 92
approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 93
Sec. 5. Effective date. 94
This act shall take effect following approval by the Mayor (or in the event of veto by the 95
Mayor, action by the Council to override the veto) and a 30-day period of congressional review 96
as provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 97
24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)). 98