Economic Development - Maryland Enhanced Tax Increment Financing (TIF) Districts

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb1580*

HOUSE BILL 1580
C8 6lr0346

By: Chair, Ways and Means Committee (By Request – Departmental – Maryland
Economic Development Corporation)
Introduced and read first time: February 13, 2026
Assigned to: Ways and Means

A BILL ENTITLED

AN ACT concerning 1

Economic Development – Maryland Enhanced Tax Increment Financing (TIF) 2
Districts 3

FOR the purpose of authorizing the Maryland Economic Development Corporation to issue 4
bonds for the development of a Maryland enhanced Tax Increment Financing (TIF) 5
district subject to the approval of the Board of Public Works; authorizing the Board 6
to authorize the State t o pledge certain revenues for Maryland enhanced TIF 7
districts, subject to a recommendation by the Corporation; and generally relating to 8
Maryland enhanced TIF districts. 9

BY repealing and reenacting, with amendments, 10
Article – Economic Development 11
Section 12–201, 12–204, and 12–210 12
Annotated Code of Maryland 13
(2024 Replacement Volume and 2025 Supplement) 14

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 15
That the Laws of Maryland read as follows: 16

Article – Economic Development 17

12–201. 18

(a) In this subtitle the following words have the meanings indicated. 19

(b) “Adjusted assessable base” means the fair market value of real property that 20
qualifies for a farm or agricultural use under § 8–209 of the Tax – Property Article, without 21
regard to the agricultural use assessment for the property as of January 1 of the year 22
preceding the effective date of the resolution creating the development district under § 23
12–203 of this subtitle. 24
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(c) “Assessable base” mean s the total assessable base, as determined by the 1
Supervisor of Assessments or the governing body in accordance with § 12 –203(b) of this 2
subtitle, of all real property subject to taxation in a development district or a sustainable 3
community. 4

(d) (1) “Assessment ratio” means a real property tax assessment ratio, 5
however designated or calculated, that is used under applicable general law to determine 6
the assessable base. 7

(2) “Assessment ratio” includes the assessment percentage specified under 8
§ 8–103(c) of the Tax – Property Article. 9

(e) “Bond” means a revenue bond, note, or other similar instrument issued in 10
accordance with this subtitle by: 11

(1) a political subdivision; [or] 12

(2) the revenue authority of Prince George’s County; OR 13

(3) THE MARYLAND ECONOMIC DEVELOPMENT CORPORATION. 14

(f) “Chief executive” means the president, chair, mayor, or other chief executive 15
officer of a political subdivision or the revenue authority of Prince George’s County. 16

(g) “Development” includes new development, redevelopment, revitalization, and 17
renovation. 18

(h) (1) “Development district” means a contiguous area designated by a 19
resolution. 20

(2) “Development district” includes: 21

(I) an extraordinary development district; AND 22

(II) A MARYLAND ENHANCED TIF DISTRICT. 23

(i) “Extraordinary development district” means a development district that: 24

(1) is designated as such by resolution; and 25

(2) contains at least 50 acres, on all or part of which a federal law 26
enforcement agency will be located. 27

(j) “Issuer” means a political subdivision or the revenue authority of Prince 28
George’s County that issues a bond under this subtitle. 29
HOUSE BILL 1580 3

(K) “MARYLAND ENHANCED TIF DISTRICT” MEANS A DEVELOPMENT 1
DISTRICT WITH A DEVELOPMENT PROJECT OR PLAN: 2

(1) (I) THAT INCLUDES A CONVENTION CENTER; OR 3

(II) THAT IS WITHIN 1/2 MILE OF A TRANSIT ST ATION IN THE 4
STATE; 5

(2) THAT EXCEEDS $500,000,000 IN TOTAL PROJECT COSTS; AND 6

(3) FOR WHICH THE LOCAL JURISDICTI ON HAS APPROVED TAX 7
INCREMENT FINANCING. 8

[(k)] (L) “MEDCO obligation” means a bond, note, or other similar instrument 9
that the Maryland Economic Development Corporation issues under authority other than 10
this subtitle to finance the cost of infrastructure improvements located in or supporting a 11
transit–oriented development, a sustainable community, a RISE zone, A MARYLAND 12
ENHANCED TIF DISTRICT, or a State hospital redevelopment. 13

[(l)] (M) “Original base” means the assessable base: 14

(1) as of January 1 of the year preceding the effective date of the resolution 15
creating the development district under § 12–203 of this subtitle; or 16

(2) if the political subdivision determined the original base in accordance 17
with § 12–203(b) of this subtitle, the base value as established in the resolution. 18

[(m)] (N) “Original full cash value” means the dollar amount that is determined 19
by dividing the original base by the assessment ratio used to determine the original base. 20

[(n)] (O) “Original taxable value” means for any tax year the dollar amount that 21
is: 22

(1) the adjusted assessable base, if an adjusted assessable base applies; or 23

(2) in all other cases, the lesser of: 24

(i) the product of multiplying the original full cash value by the 25
assessment ratio applicable to that tax year; and 26

(ii) the original base. 27

[(o)] (P) “Political subdivision” means a county or a municipal corporation. 28

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[(p)] (Q) “RISE zone” means an area designated as a Regional Institution 1
Strategic Enterprise zone under § 5–1404 of this article. 2

[(q)] (R) “State hospital redevelopment” means any combination of private or 3
public commercial, residential, or recreational uses, improvements, and facilities that: 4

(1) is part of a comprehensive coordinated development plan or strategy 5
involving: 6

(i) property that was occupied formerly by a State facility, as 7
defined in § 10–101 of the Health – General Article, or a State residential center, as defined 8
in § 7–101 of the Health – General Article; or 9

(ii) property that is adjacent or reasonably proxi mate to property 10
that was occupied formerly by a State facility, as defined in § 10 –101 of the 11
Health – General Article, or a State residential center, as defined in § 7 –101 of the 12
Health – General Article; 13

(2) in accordance with design development principles, maximizes use of the 14
property by those constituencies it is intended to serve; and 15

(3) is designated as a State hospital redevelopment by: 16

(i) the Smart Growth Subcabinet established under § 9–1406 of the 17
State Government Article; and 18

(ii) the local government or multicounty agency with land use and 19
planning responsibility for the relevant area. 20

[(r)] (S) (1) “Sustainable community” has the meaning stated in § 6 –201 of 21
the Housing and Community Development Article. 22

(2) “Sustainable community” includes a portion of a sustainable 23
community. 24

[(s)] (T) “Tax increment” means for any tax year the amount by which the 25
assessable base as of January 1 of the preceding tax year exceeds the original base taxable 26
value divided by the assessment ratio used to determine the original taxable value. 27

[(t)] (U) “Tax year” means the period from July 1 of a calendar year through 28
June 30 of the next calendar year. 29

[(u)] (V) “Transit–oriented development” has the meaning stated in § 7 –101 of 30
the Transportation Article. 31

12–204. 32
HOUSE BILL 1580 5

(a) Notwithstanding any limitation of law, an issuer may issue bonds from time 1
to time to finance the development of an industrial, commercial, or residential area. 2

(b) To issue bonds under this subtitle, the governing body of a political subdivision 3
shall adopt an ordinance that: 4

(1) describes the proposed undertaking; and 5

(2) states: 6

(i) that the governing body has complied with §§ 12 –203 and 7
12–208(c) and (d) of this subtitle; 8

(ii) the maximum principal amount of the bonds; and 9

(iii) the maximum rate of interest on the bonds. 10

(c) The ordinance may specify the following for bonds issued to carry out the 11
financing of the proposed undertaking: 12

(1) the principal amount; 13

(2) the rate of interest; 14

(3) the manner and terms of sale, WHICH MAY BE A PRIVATE OR PUBLIC 15
SALE AS DETERMINED BY THE ISSUER; 16

(4) the time of execution, issuance, and delivery; 17

(5) the form and denomination; 18

(6) the manner in which, and the times and places at which principal and 19
interest shall be paid; 20

(7) conditions for redemption before maturity; or 21

(8) other provisions consistent with this subtitle that the governing body of 22
the political subdivision determines are necessary or desirable. 23

(d) The revenue authority of Prince George ’s County may issue bonds in 24
accordance with an ordinance adopted by the governing body of Prince George’s County. 25

(e) The ordinance may specify the items listed in subsection (c) of this section or 26
may authorize: 27

(1) the finance board to specify those items by resolution or ordinance; or 28
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(2) the chief executive to specify those items by executive order. 1

(f) (1) Except as provided in paragraph (2) of this subsection, neither an 2
ordinance authorizing the bonds nor an ordinance, resolution, or executive order issued, 3
passed, or adopted under this section may be subject to referendum because of any other 4
State or local law. 5

(2) An ordinance that authorizes the pledge of the full faith and credit of a 6
political subdivision to the payment of principal and interest on a bond is subject to any 7
applicable right to referendum. 8

(G) ON APPROVAL FROM THE BOARD OF PUBLIC WORKS, THE MARYLAND 9
ECONOMIC DEVELOPMENT CORPORATION MAY ISSUE BONDS FOR THE MARYLAND 10
ENHANCED TIF DISTRICT UNDER § 12–210 OF THIS SUBTITLE. 11

12–210. 12

(a) (1) Subject to paragraph (2) of this subsection, the governing body of a 13
political subdivision that is not the issuer may pledge under an agreement that its property 14
taxes levied on the tax increment shall be paid into the special fund for the development 15
district, a RISE zone, or a sustainable community. 16

(2) The agreement shall: 17

(i) be in writing; 18

(ii) be executed by the governing bodies of the issuer and the political 19
subdivision making the pledge; and 20

(iii) run to the benefit of and be enforceable on behalf of any 21
bondholder. 22

(3) (i) This paragraph applies only in Prince George’s County. 23

(ii) Subject to § 18 –310 of the Land Use Article, the 24
Maryland–National Capital Park and Planning Commission may enter into an agreement 25
with Prince George’s County to pay all or a portion of the property taxes levied by the county 26
under §§ 18–304, 18–306, and 18–307 of the Land Use Article on the tax increment in an 27
extraordinary development district in the county to the county for deposit into a special 28
fund for the extraordinary development district. 29

(iii) The agreement authorized under subparagraph (ii) of this 30
paragraph shall: 31

1. be in writing; and 32

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2. be executed by the governing body of Prince George ’s 1
County and, on proper authorization, the Maryland –National Capital Park and Planning 2
Commission. 3

(iv) The Maryland–National Capital Park and Planning Commission 4
may not be an obligor for any bonds issued by Prince George’s County for an extraordinary 5
development district. 6

(b) The governing body of Prince George ’s County may also pledge hotel rental 7
tax revenues to the special fund. 8

(c) The governing body of a political subdivision, including the issuer, may pledge 9
by or under a resolution, including by an agreement with the issuer, as applicable, that 10
alternative local tax revenues generated within, or that are otherwise determined to be 11
attributable to, a development district that is a transit–oriented development, a RISE zone, 12
a sustainable community, A MARYLAND ENHANCED TIF DISTRICT, or a State hospital 13
redevelopment be paid, as provided in the resolution, into the special fund to: 14

(1) secure the payment of debt service on bonds or MEDCO obligations; or 15

(2) be applied to the other purposes stated in § 12–209 of this subtitle. 16

(d) (1) With the approval by resolution of the governing body of a political 17
subdivision, the Maryland Economic Development Corporation may pledge alternative 18
revenues generated within or otherwise directly attributable to a project located in an 19
approved development district, a transit–oriented development, a RISE zone, a sustainable 20
community, or a State hospital redevelopment. 21

(2) The revenues pledged in accordance with paragraph (1) of this 22
subsection shall be paid, as provided in the resolution, into the special fund for the 23
development district, transit–oriented development, RISE zone, sustainable community, or 24
State hospital redevelopment to: 25

(i) secure the payment of debt service on bonds or MEDCO 26
obligations; 27

(ii) support the Strategic Infrastructure Revolving Loan Fund 28
established under § 10–134 of this division; or 29

(iii) be applied to the other purposes stated in § 12–209 of this 30
subtitle. 31

(E) ON THE RECOMMENDATION OF THE MARYLAND ECONOMIC 32
DEVELOPMENT CORPORATION, THE BOARD OF PUBLIC WORKS MAY AUTHORIZE 33
THE PLEDGE BY THE STATE OF ALTERNATIVE REVENUES TO PROJECTS IN A 34
MARYLAND ENHANCED TIF DISTRICT, INCLUDING: 35
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(1) ALL OR A PORTION OF THE INCREMENTAL SALES TAXES FROM THE 1
MARYLAND ENHANCED TIF DISTRICT; AND 2

(2) ALL OR A PORTION OF THE INCREMENTAL INCOME TAXES FROM 3
THE MARYLAND ENHANCED TIF DISTRICT. 4

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 5
1, 2026. 6