Montgomery County Council delivering tax hike for you, massive tax cut for developers

The Montgomery County Council reached a new low this week, taking an action of fiscal irresponsibility so bonkers, it should cost them their seats in the 2026 election. They have approved legislation that will exempt any redevelopment of an office property into housing from property taxes for 20 years, if the new development provides 17.5% affordable units. Meanwhile, the same Council is planning a massive property tax increase for you, the residents of Montgomery County. Yes, this continues a pattern of shifting the tax burden from the Council's developer sugar daddies onto you, the struggling homeowner or business property owner. But it goes beyond almost any corrupt action they've taken before, as it could end up bankrupting the County, which is already under fiscal stress from a structural budget deficit and a massive debt load.

More Housing N.O.W. - a name that anyone who struggles to navigate closed streets and sidewalks around apartment tower construction sites in downtown Bethesda and Silver Spring would find laughable - is a legislative package cooked up by Councilmember Andrew Friedson (D - District 1). Loaded with developer giveaways, it appears to have been written by the developers themselves. Much like their plan to gift developers land taxpayers paid to acquire for a critical highway the Council canceled, forgoing billions in tax revenue and shifting the tax burden to you is a dereliction of duty by the Council.

Why would Friedson bring forward such an audaciously-corrupt tax break for developers? He's running for County Executive, and needs the money developers so generously provide to each of the current Councilmembers. And it's going to take a lot of money to win, especially if David Blair decides to take a third shot at the County Executive office in 2026. The seat is essentially Blair's for the taking, having lost by a handful of votes to Marc Elrich each of the previous times he ran. None of the candidates running next year have Elrich's name recognition, base of support, or voter goodwill that crosses party and demographic lines.

But barring Blair's entry into the field, developers will support Friedson. How did the unknown Friedson defeat the far-more-qualified and known former Kensington Mayor Peter Fosselman and the legendary Ana Sol Gutierrez, the first Latina ever elected to public office in Maryland, in a Democratic primary? It's not entirely clear even today, but the developer money didn't hurt. Developers haven't just mailed the checks to Friedson's campaign - they actually host fundraisers for him at their mansions.

More Housing N.O.W. is similar to another legislative victory developers enjoyed during the previous Council term, in that it simply juices the profits for development that would already happen without it. That was the bill that gave a 15-year property tax exemption (sound familiar?) to developers building residential housing on WMATA-owned land at Metro stations. Not only had such development taken place previously without this outrageous tax-free provision, but it was demanded by a development firm that had already committed to a project before attempting - and succeeding - in getting the Council to provide this tax exemption as a sweetener. Imagine their shocked and surprised delight when the knees of the Council buckled so easily to deliver such a windfall of cash, on top of the already massive profits they would be raking in.

It's no surprise they went back to the well again. After all, this Council is the biggest bunch of pushovers yet for their developer sugar daddies. The public is almost entirely unaware that this robbery of the public coffers is taking place. Or that they might be spending over $1000 more on their own property taxes next year, if they live anywhere in Bethesda, Chevy Chase, Potomac, or parts of Kensington, Silver Spring, Rockville, or even Aspen Hill. Because if your home is valued at $1 million or more, that's how much your property tax bill will be going up under the tax hike currently before the Council.

Why would the tax exemption approved Tuesday potentially bankrupt the County, and/or require your property taxes to reach unimaginable heights in the coming decades?

First and foremost, we already know that residential housing generates more new costs in public services and infrastructure than it does in property tax revenue. That, along with the County Council's out-of-control spending this century, and anti-business policies that have scared companies away from locating here, is what has created our structural budget deficit in the first place. Now imagine what the deficits will be if a majority of new apartment buildings will be paying no property taxes at all for 20 years!

Second, the legislation has a misleading talking point behind it. Most people think of "office to housing conversion" as the reconfiguration of an office building into apartment or condo-sized residential units. But the package approved Tuesday provides the same 20-year tax exemption and expedited approval for demolishing an office building, and constructing an entirely new residential building in its place.

Third, because of the allowance for demolitions, the 20-year tax exemption will apply to a huge number of projects that were - or will be - planned without the More Housing N.O.W. developer giveaways in place. In fact, a large percentage of the new buildings constructed since the "Great Recession" have been built on the ashes of office buildings that were demolished to make way for them.

We've seen that even true office-to-housing conversions have taken place without these outlandish incentives, include a new condo development and new apartment property in downtown Silver Spring. Now think about all the other apartment and condo buildings that were torn down for residential over the last 15 years alone, where the developers did not demand a 20-year property tax exemption. Gallery Bethesda I and II, Sophia Bethesda, 4909 Auburn, Stonehall Bethesda, The Wilson/The Elm (7272 Wisconsin Avenue), 8001 Woodmont, Hampden House, The Met Rockville, AVA Wheaton, and the Fairchild Apartments in Germantown are just a few examples of post-"Great Recession" redevelopments of office properties. 

Imagine if all of these were paying no property taxes for 20 years! Now realize that the long-anticipated redevelopment of the massive GEICO campus in Chevy Chase - to name just one mega project - will bring in ZERO property tax revenue to County coffers for 20 years! This is criminal.

The good news is, it's not too late to stop the madness. You can stop the More Housing N.O.W. legislation by calling or emailing your Councilmember, and all of the At-Large Councilmembers, and telling them you want no more developer giveaways. It's very easy: the Council website shows all of the Councilmembers, and there's even a tool to help you learn who your district member is (the At-Large members also all represent you, which is why you want to contact all of them, as well).

County Executive Marc Elrich is expected to veto the More Housing N.O.W. legislation when it reaches his desk. The County Council will then have to override the veto to save the developers' 20-year property tax exemption. Tell your Councilmember you will vote them out, and you certainly won't vote to promote them to County Executive if they are running for that office, if they vote to override Elrich's veto. If for some crazy reason Elrich were to sign the tax break - or let it become law by not signing it - let the Council know you will vote them out just the same, if they don't repeal it.

You can also stop the massive property tax increase by telling your Councilmember at the same time that you will vote them out if they vote to raise your property taxes again this year or next year. And if they do - VOTE THEM OUT! You don't even have to vote for a Republican; you can just vote for the new Democrats who are running against the incumbents in the primary next year. But if they squeak through again to the general election, you have to seriously consider voting for any Republican, Green, or other party challenger who remains in their way. It's the inability to vote out the Council that has led to their outrageous misbehavior. 

Are you really going to vote again for the politicians who insiders say refer to you as "losers" and "suckers" in private, willing to pay any tax, accept any reduction in your quality of life, and countenance the totally incompetent leadership they dish out?

The voters of Montgomery County need to wake up. Some of you are awake and on-the-ball. That's likely why you are reading this article now in the first place. But it's not enough. I worry about some of the other residents in this county. What will it take for you wake up and rise up against the Montgomery County cartel and its handpicked Councilmembers, who have held a majority on the Council since 2002?

You've gotten a property tax hike every year except for FY-2015, when you received a tax "cut" of about $12. The next year, the Council dropped a 9% property tax increase anvil on you like Wile E. Coyote. They seemed to pay a price for that, when voters approved term limits a few months later in 2016. But...when it came to the 2018 Council election, the cartel's candidates won every seat again. Much like their victory over the Columbia Country Club with the Purple Line, they realized they could get away with anything, and you wouldn't do a thing about it come Election Day. Invincibility. Absolute power. Such things do not a Republic make.

One of the greatest political cartoons of all time that sums up this phenomenon once ran in The Gazette. It showed a Montgomery County voter bending over in front of then-County Executive Doug Duncan, who was wielding a large paddle with the words "tax hike" on it. The voter, with his head crooked around to look back toward Duncan, said, "Thank you, Sir. May I have another?" 

Don't be that guy anymore. It's not a good look. It's a sad state of affairs, really. Break smelling salts under your nose, if you have to. 

You're mad as hell, and you're not going to take it anymore. Go to the Council website. Pick up the phone, fire up the email, and let them know, "Enough is enough!" No 20-year property tax exemption for developers, and no property tax hikes for you.

Rockville's newest streets named for notable Black figures in Montgomery County education

The newest roads in the City of Rockville have been constructed in its newest neighborhood, the Farmstead District at 16144 Frederick Road. Street signs have been installed on the completed streets, and they have been named for notable Black figures in Rockville history, particularly in the field of education. 

Nina Clarke Drive recalls a granddaughter of slaves who graduated from the Rockville Colored School in 1934, and would become the first African-American supervisory resource teacher in the integrated county school system. By 1968, Clarke was the principal at Aspen Hill Elementary School in Rockville.

George Thomas Road is named for Dr. George B. Thomas, Sr., founder of the Saturday School program in Rockville, in partnership with Montgomery County Public Schools. Begun in 1986, the program has since provided instruction to thousands of students at 12 sites across the County. This was the capstone of a career at MCPS, and in the U.S. Air Force before that.

Odessa Shannon Way pays tribute to the first Black person to be elected to public office in Montgomery County. Shannon was elected to the Montgomery County Board of Education in 1982.

Henson Norris Street commemorates a founding member of the Rockville Colored School Board. The board raised funds to construct and open the original Rockville Colored School in a two-room schoolhouse in 1876. It was located on what is today the parking lot of the Snowden Funeral Home.

Speaking of construction, the homes at Farmstead District continue to reach completion at the new development, which is a partnership between EYA and Pulte Homes. A sign shows how many of each model have sold, and how many remain.

Watkins Cabinet Co. closes after 73 years in Montgomery County, property for sale

Watkins Cabinet Company has closed at 18001 Sellman Road in Dickerson, after 73 years in business. Its 14,884-square-foot factory and warehouse facility has been put on the market for sale. This is a prime 1.43-acre property for an industrial/manufacturing use, as it is right on the CSX Metropolitan Subdivision tracks, part of a major freight and Amtrak route between Washington, D.C. and Chicago. That creates the opportunity for direct freight rail shipping across the nation, or to ports in Baltimore and Norfolk. 

I have suggested for many years that Montgomery County sit down with CSX and try to create attractive industrial sites alongside the railroad. This could be for the manufacture of anything from furniture to pharmaceuticals to drones. In exchange for the new freight business, CSX might then cooperate for the additional track that has been sought for use by MARC commuter rail on this line. According to the online sale listing, the asking price for the Watkins Cabinet property is $2,000,000. If Montgomery County is serious about getting the third track, these are the types of opportunities they should be investigating in partnership with CSX. Even without a third track, moribund Montgomery County needs the business and high-wage job growth.

Wilbur Watkins founded Watkins Cabinet Company in 1952. It remained family-owned for all 73 years. You might have a Watkins cabinet, vanity, bar, or bookcase in your home right now, if you live in the Washington, D.C. region.

Photos courtesy Brian Jamison Real Estate

You could be 7-Eleven's landlord in Germantown

If you have $4 million burning a hole in your pocket, you could take a Big Bite out of Germantown real estate. The land underneath the 7-Eleven convenience store and gas station at 12861 Clopper Road has hit the market for sale. You would become the landlord for 7-Eleven under this triple net lease (NNN) arrangement. The online sale listing offers some interesting facts about this 7-Eleven, such as its status in the 91st-percentile of customer traffic for the brand among all 7-Eleven stores in the United States, that 321,000 customers have patronized this 7-Eleven in the last 12 months, and that the store has about 5.5 years left on its current lease.

Someone save this movie theater in Montgomery County!

You could own your very own cineplex in Montgomery County. CBRE is now marketing the vacant Regal Cinemas at 20000 Century Boulevard in Germantown for sale. While the signage posted on the theater building is pushing a retail use, the online sale listing notes that the 14-screen cineplex inside remains intact. That means this could be essentially a turnkey operation to reopen the theater for a smart cineplex chain, or a wealthy movie buff. Financing is being offered on the listing page, but the asking price for the property - which includes a large surface parking lot - is not provided. Good luck, and until next time, the balcony is closed!

Vacant Rockville Town Center storefronts could become homes with City approval

A proposal to turn vacant retail storefronts in the struggling Rockville Town Center into two-level loft homes is again moving forward. Property owner Comstock is seeking permission from the City of Rockville to convert 13,011-square-feet of vacant storefronts in the ground level of its BLVD Ansel apartment building into 13 dwelling units, which would be branded as "BLVD Lofts/The Lofts at Ansel." Functionally, they will be like townhomes flush with the building, and residents will enter via doors right on the sidewalk.

Several floorplans would be available. Comstock says that residents of the new loft units would have access to the building amenities available to the other residents of the apartments upstairs. Some units will have steps up to the front door where grading makes that necessary; most units would also have ADA-compliant access from a "rear corridor." Mail delivery to the loft units would be served by a mail and package room in the lobby. Comstock says it is not going to entirely give up on retail at the property; 6500 SF of vacant retail space would be retained for potential retail or restaurant tenants under the proposal.

A sample floorplan for one of the loft units

The Rockville Planning Commission will receive a briefing on the loft conversion proposal at its March 12, 2025 meeting at 7:00 PM. Four residents have submitted comments on the plan so far; three residents expressed support, and one opposed it.

Images courtesy Comstock/City of Rockville

Montgomery County to lose more jobs to housing in Rockville

Another valuable Montgomery County office park property could be lost to residential housing, if the City of Rockville approves a proposal to convert it into condos and townhomes. 1455 Research Boulevard, one of many office sites located in the I-270 corridor of the County, would become 106 townhomes, 30 stacked condo townhomes, and 72 multifamily condo units, under the plan envisioned by developer Pulte. The company is building several similar developments in the City, including within the new Farmstead community, as well as in the King Farm, and Tower Oaks areas. Pulte's site plan is likely to be reviewed at a public hearing by the Rockville Planning Commission in summer or fall of 2025.

The existing office building, which was only constructed
about 30 years ago

The existing office building contains 17 office suites, 10 of which are currently leased, according to the property website. So the building is 59% leased. The property is 10.6 acres in size, meaning that it would still be ideal for a corporate headquarters, or a research, lab, and/or manufacturing facility, if the existing building were torn down for that purpose. It is directly adjacent to I-270. To state the obvious, all of the jobs currently provided by the current tenants of the building will likely be lost to the City and County in a conversion to housing. And the many more potential, high-wage jobs that could fill this office park site - and the resulting revenue - will never be realized.

Pulte's proposed redevelopment plan
for residential housing

From a County revenue standpoint, filling the current building, or replacing it with a major corporate headquarters or facility, would be more ideal than filling the site with residential housing. That's because residential housing, as we have seen this century, generates more costs in County services and infrastructure demands than it does in tax revenue. Hence the County's structural budget deficit, which extends as far into the future as the forecasts go. And do you remember "smart growth," which included placing jobs near housing, to reduce congestion and auto emissions in the I-270 corridor? Neither do the County Council and Planning Board, which don't even talk about "smart growth" anymore, having abandoned its fictional, expedient construct for the equally-fictional canards of "affordable," "attainable," "equity," "inclusionary," and "missing middle" - all code words bandied about in a nationwide campaign to allow upzoning for higher-density luxury housing in existing suburban neighborhoods.

Office, research, manufacturing and commercial uses, in contrast, generate less traffic and require no additional school capacity, for example. The problem is that the Council has driven the County's economy into the ditch over the last 23 years, through radical anti-business policies, and a failure to provide the necessary infrastructure to compete with Northern Virginia, such as direct highway access to Dulles International Airport via a new Potomac River crossing. Montgomery County has not only lost every competition for major corporate headquarters to Virginia during this time, but is most often not even in the hunt for these opportunities.

As a result, Montgomery County has failed to attract a single major corporate headquarters in over 25 years. While MoCo leaders slumbered this century, Virginia added the HQs of Northrop Grumman, Intelsat, Hilton Hotels, Nestle, Lidl, Gerber, Volkswagen, Corporate Executive Board, Amazon HQ2, CoStar, Lego, and more. And those are just ones we lost to Virginia! 

Montgomery County has been left to spend large sums just to retain some of the HQs it had, like Marriott International, Choice Hotels, and GEICO, all of which have downsized when making their moves. In addition to such rearrangements of the deck chairs aboard the Titanic, Montgomery County has lost still other HQs that it had altogether. While the Council argued about the legality of circus animals one week last decade, representatives of New York City and Knoxville were completing final, secret negotiations that sealed their victory in snatching away the Discovery Communications HQ from downtown Silver Spring.

Obviously, property owners such as those at 1455 Research Boulevard can't be blamed for all this. They, understandably, are not going to simply wait for a future ousting of the Montgomery County cartel from power to maximize their investment. So we are likely to end up with more residential housing at this site. The Council is not sad about that, as their developer sugar daddies want them to keep Montgomery County bad-for-business, so that prime office park sites can become residential housing sites instead. Virginia prepares and markets such office/industrial properties extensively to international businesses, and reaps the spectacular results; Montgomery County just waits for someone to build housing on them. Too bad that Montgomery County residents will continue to shoulder the increasing tax burden to make up for all of this lost business and commercial revenue. Heckuva job, Brownie!

Rockville land auction underway for I-270-adjacent plot

An auction of a unique commercial property adjacent to I-270 in Rockville is underway online, and will conclude today, February 26, 2025, at 12:00 PM. You can follow the action online this morning, even if you are not in a financial position to bid. The off-ramp to Redland Boulevard on the northbound side of the highway wraps around the plot. As of this writing, the top bid for the 2.09 acre site is $325,000. A previously-scheduled auction of the property in mid-January apparently was postponed, or failed to draw a qualifying bid. 

The property would be ideal for any business that wants to have visibility, and possible logo signage exposure, from heavily-traveled I-270. Less than ideal are the ingress/egress possibilities onto a one-way off-ramp, and the blind curve for traffic rounding the bend to reach Redland Boulevard. And while access from I-270 would be quick and excellent, getting onto the interstate from the site would be a logistical chore.

Montgomery County Council seeks new $20K+ demolition tax on teardowns for new homes

Housing prices are out-of-this-world in Montgomery County, but leave it to the radical Montgomery County Council to raise them even further. Councilmembers Kristin Mink (D - District 5) and Will Jawando (D - At-Large) are sponsoring a bill that would impose a "demolition tax" when a home is torn down, or even partially-demolished. The new excise tax would begin at $20,000, and then rise in future years, as the tax will be linked to the Consumer Price Index as of July 1 each year. As anyone who understands basic economics knows, the $20,000+ amount will be fully passed on to the homebuyer purchasing the new house, or the homeowner investing in the new home or renovation. It's shocking the Council would deliberately impose a massive increase in home prices like this.

In true Communist fashion, the money the Council steals from struggling homebuyers via the new tax will be shifted into the Montgomery County Housing Production Fund to finance "affordable" housing projects. Comrade, er, Councilmember Evan Glass (D - At Large) proposed a similar demolition tax in 2019, but it failed to pass that year. A public hearing on Bill 5-25 has been tentatively scheduled for March 18, 2025 at 1:30 PM at the County Council Office Building at 100 Maryland Avenue in Rockville.

Bainbridge name dropped from apartment properties in Montgomery County

The Bainbridge name is gone, as is the fancy-font signage above the lobby entrance at 4918 St. Elmo Avenue in downtown Bethesda. Now the apartment tower that opened a decade ago will be called "Ellis Bethesda." And in Rockville, the Bainbridge Shady Grove at 15955 Frederick Road is now "The Reed." "Ellis" has no obvious connection to Bethesda; "The Reed" is likely commemorating the historic Reed Brothers Dodge dealership, for which there are already two tributes on-site: Dodge Hemi engine piston-inspired street lamps, and a public art installation. No explanation has been given for the change of branding. 

New Maryland regulation will raise cost of buying a home, agency warns

A new directive issued by the Maryland Office of Financial Regulation last month will raise the cost of buying a home, and make financing harder to obtain, credit rating agency KBRA warned yesterday. The January 10, 2025 licensing rule update requires mortgage trusts and their assignees to obtain licenses under Maryland’s Installment Loan Licensing Law and Mortgage Lender Law. MOFR clarified that Fannie Mae, Freddie Mac, Ginnie Mae, all other federal, state, and local governmental loan purchase programs, as well as any trusts created by these entities, are exempt from the rule. However, as KBRA noted, $3.7 billion in Maryland loan balances are currently financed by the U.S. non-Agency securitization market.

"Non-agency" means private mortgage securities not backed by the aforementioned government and quasi-government agencies or entities. KBRA said the new licensing requirement will likely reduce the number of financing sources available to homebuyers in Maryland. For those who can still obtain financing, KBRA warned, the reduced competition and higher licensing costs will be passed on to homebuyers in the form of higher monthly payments. A new Washington Post/University of Maryland poll found the already-high cost of housing is now the top concern of Maryland voters.

Rockville construction update: The Pinnacle (Photos)

The Pinnacle, a senior living apartment complex, is now about four stories above street level in White Flint. Located at 11565 Old Georgetown Road, it will eventually rise to 17 stories. Inside will be 113 independent living apartments, 40 assisted-living units, and 48 units reserved for memory care and early-stage-dementia Bridge patients. Residents who are still independent will be right across the road from dining, shopping, and entertainment at Pike & Rose, and walking distance to the White Flint Metro station. The building itself will have its own 15,000-square-feet of restaurant and retail space, and will appear outwardly as a luxury apartment building, rather than a retirement or nursing facility. Developer Silverstone Senior Living anticipates a Q2 2026 delivery for the project.