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Community Investment Tax Credits Can Help You Save on Taxes

Community Investment Tax Credits

Thank you for your interest in supporting RTMC!  Are you a resident of Maryland or a business that pays Maryland state taxes?  If so, RTMC can help you boost your contribution by reducing your tax liability, using Maryland’s Community Investment Tax Credits. Most years, RTMC receives an annual allocation of Community Investment Tax Credits from the Maryland Department of Housing and Community Development.  After the allocation, RTMC finds individuals and businesses who wish to donate $500 – $500,000 in money or real property to RTMC, and in the process, earn 50% of the value of the contribution in state tax credits.  Community Investment Tax Credits are usable in addition to the Federal and State tax deductions for charitable donations.

The combination of the tax credits and tax deductions significantly reduces the actual out of pocket spent per dollar donated…which allows for larger donations!  The following table shows how RTMC and businesses at different tax rates can benefit from the Community Investment Tax Credits:

  Small Company Mid-Size Company Large Company
Tax Rate 17% (10% Fed, 7% State) 30% (23% Fed, 7% State) 43% (36% Fed, 7% State)
Donation to RTMC $1,000 $1,000 $1,000
Combined tax deduction ($170) ($300) ($430)
Tax credit on state tax return
(50% of donation)
($500) ($500) ($500)
Total tax benefit ($670) ($800) ($930)
Net out-of-pocket cost $330 $200 $70

Eligible businesses include any entity that conducts a trade or business in Maryland and is subject to the state income tax, the public service company franchise tax, or the insurance premiums tax.  These types of entities generally include corporations, public utility companies, insurance companies, financial institutions, S corporations, sole proprietors, and limited liability corporations.

Eligible individuals include residents of Maryland.  Residents are defined as individuals who are living in Maryland on the last day of the taxable year, or individuals that live in Maryland for more than 6 months of the taxable year and are physically present in the state for 183 or more days during the taxable year.

For more information about making a donation and using Community Investment Tax Credits, please contact Elisa Hermes at 301-947-9400.

USEFUL LINKS

The following information may be useful to both individuals and businesses making contributions, as well as nonprofit participants in the Community Investment Tax Credit program. This information is for reference only and any individual or business contemplating making a contribution, that has questions about their specific tax advantages, is encouraged to consult with their accountant or tax professional.

Women Renovate a Home and Strengthen Community at She Builds 2017

On Saturday, April 29, 2017, Rebuilding Together Montgomery County’s kicked off its inaugural She Builds event with a talented crew of female volunteers that worked tirelessly to repair the home of Ms. Belay, a mom, 1st generation American and an engaged community member.

“She Builds” is part of Rebuilding Together’s national effort to bring together female business leaders and volunteers to support the most vulnerable populations of female homeowners in our nation.  According to USAID, programs that provide women opportunities to better their family’s health, education and shelter, have effects far beyond a single individual.  In fact, USAID reports a woman multiplies the impact of an investment made in her future by extending the benefits to her community 3-fold.

Through She Builds, RTMCs work with our partners and volunteers to provide critical home repairs to women-owned households and facility improvements for nonprofits that provides services to low income women in need.  She Builds events are organized by women, executed by women and benefit the entire community. Designed to highlight the unique strengths that women in our communities bring to ensuring fair and affordable housing for all, She Builds

In order to cover the costs of repairs made to Ms. Belay’s home, She Builds volunteers contacted friends, neighbors, social media network, etc. in a peer-to-peer fundraising campaign.  Through their efforts, the team raised $4,505 with donations still coming in!

On project day, House Captain, Ms. Jodi Longo, was instrumental in ensuring that tasks were properly executed.  Jodi, owner of the full-service construction company Renovation Studio, was a perfect fit for the job.  House Ambassador, Tara Murayama, helped make sure everything went smoothly and Ms. Belay’s needs were met to the best of our abilities, while crew leaders Sherry Kissal, Marion Coleman, Susan Prather, and Kathy Narva led groups of volunteers in providing hands-on “how to” information for each task.  These women leaders proved invaluable to the project which simply could not have been completed without their help.

Students from the Woods Academy worked on landscaping the front and back yards.  Attorneys and friends from Birchstone Moore helped sand the deck to prepare it for staining, while another group ov volunteers removed broken, rotted lattice from underneath the deck.  Inside, women painted Ms. Belay’s living room.

The afternoon volunteers demolished a rotting and unsafe backyard shed, continued landscaping, finished sanding the deck and completed interior painting. Carolina Menor, Colleen Lee, Janet Demas and several others provided delicious breakfast, snacks, and lunch to nourish everyone throughout the day.

The day ended with lots of hugs and group photos of tired but satisfied volunteers, as well as tea and cake provided by a very appreciative homeowner!  Already, Jodi Longo and RTMC staff are excited to plan for next year’s She Builds!

A heartfelt THANK YOU to the amazing volunteers who came out to lend a hand to a neighbor in need — your work is invaluable, appreciated and something to be proud of.

For information on how to get involved in a future She Builds event, please contact Melissa Erickson, Development and Communications Manager at 301-947-9400, x105 or at merickson@rebuildingtogethermc.org.

 

Hawk Handyman Volunteers Support Summer Lowe’s Project

The best antidote I know for worry is work. The best cure for weariness is the challenge of helping someone who is even more tired. One of the great ironies of life is this: He or she who serves almost always benefits more than he or she who is served.

Throughout the year, Rebuilding Together Montgomery County (RTMC) has the great fortune of employing the help of ten amazing volunteer handymen. These gentlemen offer up their time to do recurring projects for RTMC. According to Pete Baum, a participant in the Hawk Handyman program, “I just love coming out to help other people. It’s rewarding work. Finishing the day, knowing that I’ve been able to make someone’s life easier and better is a good thing. My friend Marty brought me into this work and I’m so glad that he did.” That friend he’s referring to is Marty Severe who has worked with RTMC for more than a decade!

“Giving and getting is part of volunteerism. With RTMC, I’m able to give back to my community in a meaningful way while working alongside my old friends. It’s a way to have fun and invest my time in a meaningful act of service,” says Marty Severe.

On Wednesday, June 28th, Hawk Handymen Pete Baum, Marty Severe, Larry Cole, and John Vilgos worked alongside Lowe’s ProServices team members to address health and safety concerns in the home of one of our clients.

Together, they completed a roof patch, replaced the home’s gutters, connected a new fridge and stove, installed smoke and carbon monoxide detectors, made electrical repairs, placed new and larger house members on the front of the home, and attached new railings to help our client navigate his stairs in a safer and more stable way.

Many thanks to Lowe’s for their continued partnership with Rebuilding Together, for the homeowner who entrusted us to his home, and to the committed Hawk Handymen who are there for our community when it counts!

RTMC RAISES MORE THAN $51,000 AT 24TH ANNUAL CHARITY GOLF TOURNAMENT

One hundred and twenty-four golfers participated in 18 holes of scramble golf at Whiskey Creek on Monday, October 17. Approximately $51,000 was raised to support the safe and healthy housing solutions that RTMC provides across Montgomery County.

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For Immediate Release

Gaithersburg, MD, (October 21, 2016) – Rebuilding Together Montgomery County (RTMC) hosted it’s 24th annual golf tournament on the beautifully maintained greens of Whiskey Creek Golf Club in Ijamsville, MD on October 17.  Approximately $51,000 was raised to support the safe and healthy housing solutions that RTMC provides to homeowners in need across Montgomery County.

To date, Rebuilding Together has engaged more than 48,000 committed volunteers and 6,400 skilled trades professionals in its home repair services.  Together, they’ve improved more than 2,100 homes and nearly 40 county nonprofit facilities and community spaces.

“This year’s tournament was a huge success, bringing both long-time and new RTMC supporters together to golf for a great cause – safe, secure, and healthy housing. The day was gorgeous and the game play was strong; in fact, this year’s participants had such a good time and were so generous that more than half of the teams have committed to next year’s event,” said RTMC Development Director Aaron Gonzales.

This year’s participants enjoyed a variety of competitions in addition to the 18-hole scramble. Activities included a putting contest where the winner sunk the 50 foot put twice, a men’s and women’s long-drive contest and “beat the pro” competition with 2013 Re/Max World Long Drive Champion Heather LeMasters.  A complete list of the games and winners are below:

  • Closest to the Pin (Hole #7): Rick Berube
  • Longest Drive (Hole #16): Women- Pimpich Suphaphon, Men- Tom Cavazos
  • Straightest Drive (Hole #2): Ron Serabian
  • Putting Champion: Carl Vail
  • Team Winners:
    • 3rd Place Team: Bob Billig, Kevin McGovern, Joe Salisbury, George Magas (RSM US LLP)
    • 2nd Place Team, Bob King, Leonard Proctor, Phil Cantor, Mike Friemand
    • 1st place Team: Steve Welsh, Scott Waiter, Rick Berube, Brian Bartley (Standard Solar)

RTMC thanks it’s enthusiastic golfers and generous sponsors for investing in its work through the 24th annual tournament. We can’t wait to see you back next year!

To learn more about RTMC and ways to get involved, visit www.rebuildingtogethermc.org or contact us at info@rebuildingtogethermc.org.

About Us:

Rebuilding Together Montgomery County (RTMC) is a safe and healthy housing organization that believes community starts at home. RTMC works in partnership with local government, nonprofits, and corporate partners to provide safety repairs, accessibility modifications and energy efficiency upgrades to the homes of low-income residents throughout Montgomery County. The repairs and links to community resources offered by RTMC prevent homelessness, preserve affordable housing, and provide safe and independent living for our community’s most vulnerable residents. Additionally, our work revitalizes and stabilizes vulnerable neighborhoods and communities across the county.

Media Contact:

Aaron Gonzales, Director of Development
301-947-9400, x101
agonzales@rebuildingtogethermc.org

RTMC’s Executive Director to Receive The Daily Record’s Leading Women Award

For Immediate Release

Gaithersburg, MD, (October 21, 2016) – Rebuilding Together Montgomery County (RTMC) is proud to announce that its Executive Director, Christina Betancourt Johnson, has been selected to receive one of The Daily Record’s 2016 Leading Women Awards.

The Daily Record’s Leading Women awards honor 50 women who are 40 years of age or younger for the accomplishments they have made thus far in their careers.  A panel of previous Top 100 women and Leading Women winners selected the honorees based on their professional experience, community involvement and commitment to inspiring change.

As quoted by Mr. Bruce Bereano, attorney and lobbyist in Annapolis, “I believe Christina is a leader and will continue in life as such and as a mentor and role model for other young people that come to know and work with her.”

According to Brigid Howe, Executive Director of Nonprofit Montgomery, “The county’s nonprofit sector is fortunate that Christina is such a strong and dynamic leader.  Not only does she lead Rebuilding Together Montgomery County in providing important home repair services to vulnerable residents, but she also serves as Board president of Nonprofit Montgomery.  I appreciate her enthusiasm, sense of humor and commitment to the community.”

The Daily Record launched the Leading Women awards in 2010 to recognize the next generation of Maryland’s women leaders.  With the announcement of this year’s winners, 350 women will have received the award since its founding.

“It’s a privilege to be recognized by The Daily Record and previous awardees as a Leading Woman.  The honor is owed, in large part, to the community of peers, staff, family and mentors that keep me humble and focused while serving our residents, our businesses and our region,” says awardee Christina Betancourt Johnson.

Nominees for Leading Women were asked to complete an application that outlined their education and career history, examples of mentoring, career-related officer and board memberships in professional, business or trade organizations, volunteer involvement in civic and nonprofit organizations, awards and honors, professional accomplishments, and commitment to inspiring change in their organization or the community.

“The Daily Record’s 2016 Leading Women are truly inspirational. Their professional accomplishments, community involvement and commitment to inspiring change exemplifies why they are Leading Women in Maryland,” said Suzanne Fischer-Huettner, publisher of The Daily Record. “They excel to high levels professionally and personally, and The Daily Record congratulates them on this award.”

The 2016 Leading Women awards will be presented Dec. 5 at a reception and dinner starting at 5:30 p.m. at The Westin, 100 Westgate Circle in Annapolis. Winners will be profiled in a special magazine that will be inserted into the Dec. 6 issue of The Daily Record and available online at www.TheDailyRecord.com.

For more information about sponsorships and tickets for The Daily Record’s 2016 Leading Women awards, visit www.TheDailyRecord.com

 

About Us:

Rebuilding Together Montgomery County (RTMC) is a safe and healthy housing organization that believes community starts at home. RTMC works in partnership with local government, nonprofits, and corporate partners to provide safety repairs, accessibility modifications and energy efficiency upgrades to the homes of low-income residents throughout Montgomery County. The repairs and links to community resources offered by RTMC prevent homelessness, preserve affordable housing, and provide safe and independent living for our community’s most vulnerable residents. Additionally, our work revitalizes and stabilizes vulnerable neighborhoods and communities across the county.

 

Media Contact:

Aaron Gonzales, Development Director

301-947-9400, x101

agonzales@rebuildingtogethermc.org

 

About The Daily Record

For more than 127 years, The Daily Record has provided trusted legal, business and government information to Maryland readers. In addition to the daily newspaper published five days a week, The Daily Record publishes its website, www.TheDailyRecord.com; five blogs – Business Buzz, Eye on Annapolis, Generation J.D., Ground Up and On the Record; six e-newsletters – Insider, Annapolis Insider, Auction Notices, Maryland Family Law Update,  Legal Jobs and Path to Excellence; its Path to Excellence – A Women’s Guide to Business magazine nine times a year; and a variety of special publications on topics of interest to Maryland business and legal professionals.

The Daily Record also honors leading Marylanders through eight annual awards events:  Maryland’s Top 100 Women, Influential Marylanders, 20 in Their Twenties, VIP List, Most Admired CEOs, Innovator of the Year, Leadership in Law and Leading Women.

Residents Feel Sense of Pride after RTMC and World Bank Group Renovates Homeless Shelter

World Bank/Montgomery County Coalition for the Homeless

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On September 29th, the Montgomery County Coalition for the Homeless Men’s Shelter got a much-needed facility facelift to enhance both the aesthetic of the building and renovate its heavily used common spaces. Since its founding in 1990, the shelter has provided both short and long-term solutions to homeless men in the form of emergency shelter and permanent supportive housing. Thanks to the World Bank volunteers and the RTMC team, this facility will continue to provide shelter for years to come.

The Men’s Shelter at the Montgomery County Coalition for the Homeless is a remarkable space, serving about 700 residents each year. During the winter months, known as hypothermia season, the shelter has the capacity to reach up to 230 residents at once. The facility has been open since 2000, and has seen 16 years of serving residents at this high rate. Throughout these past 16 years, the building experienced extensive wear and tear that the dedicated staff at MCCH could not repair on their own.

Of chief concern was the main men’s bathroom, which was in urgent need of critical repairs. After years of high volume use, the restroom facility was not what it once was. The restroom floors had been damaged by raw sewage leakage and the toilets were inoperable.  The entire space needed a deep-clean and the walls needed to be re-painted. This is the largest bathroom in the facility and because of the condition that it was in prior to starting the project, it was hardly ever used.

The shelter was also in need of some cosmetic repairs, such as painting the walls, cleaning, and organizing to brighten up the space, making it more inviting to residents. There was plenty of work to be done and the volunteer group from the World Bank came ready to work hard!

The 30 committed and energized World Bank volunteers arrived bright and early on a dreary Thursday morning to begin work. The group gathered for a brief introduction and team meeting before breaking into the cleaning and repair gear. The largest group of volunteers spent the day making repairs to the bathroom, and painting the walls inside the bathroom and the surrounding hallways. Another group focused on deep cleaning and reorganizing the kitchen, tossing out expired food for a safer and healthier kitchen.  Others focused on cleaning the laundry room, building storage shelves for the area, and reorganizing the professional clothing closet. With each passing hour, the facility transformed, and by the end of the day, the residents were all speaking of the great improvements made to their new space.

Montgomery County Coalition for the Homeless’ Executive Director, Susie Sinclair-Smith, was overwhelmed with the building’s new look. She shared that some of the repair work that was done made her reflect on her life, and how lucky she feels.  “To have you come in and in one day, or a couple days, transform our men’s bathroom into a dignified area – it made me think how lucky I am to have my own bathroom… and to have a bathroom that really meets their needs is great.”

Susie was also pleased with the kitchen clean-up, explaining that it is one of the most highly used spaces in the facility. Thousands of meals are donated to the men’s shelter at MCCH yearly and volunteers come in frequently to serve meals to the residents, illustrating how the shelter builds and strengthens community by putting the needs of our most vulnerable county residents first. Susie speaks of a particular transition that occurs during mealtime, saying that “men have gone from being invisible to being in the shelter and being served”, and how much that does for their emotional well-being.

Shelter residents felt that sense of community throughout the World Bank’s volunteer day. Kevin, one of the residents of the men’s shelter, was thankful for the bathroom renovation, “I know the bathroom is renovated and that’s a big help. I rarely used that bathroom you renovated [because of the deteriorated condition], and now I see them [both restrooms] as being equal.” He also mentioned the importance of the deep clean of the kitchen, stating that many of the residents have health issues and need their meals to come from a space that is as healthy as possible. Healthy and safely prepared foods not only nurture our bodies but our souls as well.

When the day was finished, I had the chance to sit down with World Bank team member Nana Maiga as she shared her thoughts on the experience. She had never been involved in a project like this before and was thrilled to have the chance to participate. Not only was she grateful for the impact the World Bank had on the shelter, she was simply glad to be giving back. “I’m very impressed with the work you do, and it’s such a positive environment. You can tell it’s important… to treat people with dignity. I can’t wait [to] come back next year!”

All told, the project day was tremendously successful! In addition to being important for the health and safety of the men’s shelter, the impact of the day is undoubtedly lasting for residents. Seeing a team of volunteers come in to help care for the facility and the residents was truly uplifting for many. Kevin spoke of the day’s significance, “as far as people coming in and doing things like this, emotionally it helps just to see people coming in that care.”

Thanks to the Montgomery County Coalition for the Homeless for inviting us into their space and to the World Bank for their commitment and dedication to our neighbors in need!

Sold – Sold – Sold !!!

Rebuilding Together Montgomery County (RTMC) teamed up with exceptional builders to craft unique and exciting playhouses that delight and inspire the little ones in our lives. These extravagant, detailed, high-quality playhouses were talk of the neighborhood – and were up for bid on Saturday, June 18th at Rebuilding Hope: The RTMC Playhouse Project. At RTMC’s 3rd annual event, more than  100 guests enjoyed cocktails and appetizers while supporting Rebuilding Together and the community investment made to preserve affordable housing, prevent homelessness and provide hope for some of our county’s most vulnerable residents.

While walking the Plaza at The Shops at Wisconsin Place, guests previewed all 7 playhouses on display, 3 of which had already been pre-sold!

Co-emcees for the night, Dawn Gontkovic and Councilmember Craig Rice, provided opening remarks and kept the crowd entertained before the playhouse bidding began. RTMC’s Executive Director, Christina Johnson, was presented with a check from Whole Foods’s Carrie Coonan which represented their purchase of two playhouses. One of those playhouses, which is Pepco’s “MiniShed” , is a green house built with sustainable materials, featuring a solar powered roof, allowing for rainwater harvesting and boasting elevated planter beds. Whole Foods has agreed to generously donate this playhouse to a STEM school within the Montgomery County Public School system. Whole Foods will donate the other playhouse, Mother Earth’s cabin, to local nonprofit CentroNia.

Special thanks were delivered to Whole Foods Market and TW Perry, who were both presenting sponsors for this year’s event.  Special recognition was given to Jeffrey Slavin, Mayor of the Town of Somerset by Family Services, Inc.’s Scott Birdsong. FSI recognized Mr. Slavin for his generous donation of a playhouse two years ago and has since been placed at an FSI childcare facilities in Montgomery County.

When Auctioneer Lia Kvatum brought the gavel down for the final winning bid, 4 uniquely designed and custom-built children’s playhouses were auctioned off and another successful playhouse project came to an end, raising more than $70,000 for RTMC’s great work in the community!

Rebuilding Together would like to thank all of its long-time Playhouse Project sponsors, all of its new sponsors and all of the in-kind partners that helped make this event a huge success!

Join Us at RTMC’s Reception & Live Playhouse Auction

It’s that time of year again and Rebuilding Together Montgomery County(RTMC) is hosting its bi-annual fundraiser, Rebuilding Hope: The RTMC Playhouse Reception and Live Auction is on Saturday, June 18th from 7-9PM.

Every other year, RTMC auctions off amazing, custom-built playhouses to parents, grandparents, and local philanthropists committed to serving out community’s most vulnerable residents.

Please join us at this event and consider supporting it either as a donor or as a playhouse purchaser.

To date, RTMC’s successfully, raised $40,000.00 by pre-selling 3 out of the 7 playhouses that are now on the plaza!!!

There are four remaining playhouses on the market – “The Chalet” built by C. M. Conlan Contractors & Builders Inc., “The Hobbit House” built by Harkins Builders, “Friendship Station” built by Sandy Spring Builders, and “The Accessible Sand Castle” built by ProHome Contractors and Accessible Home Associates & Levine Design Studio. Each are housed on the plaza at Western & Wisconsin Avenue, pictured below, and featured on the playhouse website.

Rebuilding Together Playhouse delivery to Wisconsin Place

Houses sell typically sell at auction for $6500-$15,000.00.

By purchasing a playhouse, you’re not only investing in an amazing play space for children to enjoy for years to come, but you’re also providing help and hope for other families at the same time!

If you can’t purchase a playhouse, we’d still love for you to share this event with friends, and/or join us for an evening of fun, friends and community impact.

The Challenges of Aging-In-Place

by Caroline Blakely, President and CEO of Rebuilding Together

In The New York Times piece “Aging in Place” columnist Jane E. Brody discusses the very real considerations that homeowners must take into account as they age. She brings up many valid points regarding the barriers to aging-in-place for older homeowners, and provides some great recourse and ideas for facing those challenges. However, as we continue the conversation around the housing crisis facing our aging population, it is vital that we also consider the aging-in-place needs of individuals with limited income.

According to the National Council on Aging, more than 25 million Americans aged 60 and older are considered economically insecure – living at or below 250 percent of the federal poverty level. For older homeowners, and estimated 3.5 million are underwater on home loans and have no home equity. For these individuals, retirement communities are prohibitively expensive, and moving in with family members may not always be a valid recourse for a variety of reasons ranging from lacking financial resources to limited space in their relatives’ homes. Oftentimes, aging-in-place is the only recourse for these homeowners, and the equity built into their home remains their greatest, and perhaps only, source of wealth.

America is undoubtedly facing a housing crisis, especially when it comes to older adults. Over the course of the next two decades, the number of adults aged 70 or older will increase by 91 percent, according to the Harvard Joint Center for Housing Studies. This exponential spike will create a demand for housing that is both affordable, and equipped to accommodate aging-in-place residents. Housing that checks both those boxes is scant.

America’s aging housing stock is not equipped to handle the needs of its rapidly aging population. Simply put, most homes were not designed with older adults in mind. Steep staircases, too-narrow doorways and other basic housing features pose serious safety risks to older homeowners.

Aging in modern America is also a costly process, particularly as many Americans lack sufficient retirement savings to cover the cost of healthcare and other necessary expenses. Overburdened by these costs, millions of aging homeowners simply cannot afford to hire someone to make their homes more accessible through aging-in-place modifications. According to the National Association of Homebuilders, 80 percent of aging-related home modifications are paid for out-of-pocket, posing “a significant obstacle to aging-in-place for the poorest elderly, who have both the highest levels of disability and tend to live in older housing stock.”

This is why the work of organizations like Rebuilding Together is so urgently-needed. Rebuilding Together is a leading, national nonprofit working with low-income homeowners to improve the safety and health of their homes. Each year, Rebuilding Together’s local affiliates and nearly 100,000 volunteers complete about 10,000 rebuild projects nationwide.

Rebuilding Together’s services help preserve affordable homeownership and stabilize neighborhoods, empowering homeowners and their families to remain in their homes and communities.

Older adults make up the majority of homeowners served by Rebuilding Together. In 2015 alone, we worked with volunteers, partners and local community organizations across the country to provide safe and healthy home repairs and modifications for more than 5,400 homes with occupants aged 62 or older. These homeowners have lived in their homes on average more than 20 years, and want to stay put.

By installing handrails, grab bars, easy-to-operate handles and switches, nonslip flooring and improved lighting, we increase home accessibility and allow low-income older homeowners to be safer and more independent. This not only empowers them to remain in their homes, it is also cost-effective in the long term. According to the Center for Hosing Policy, studies on Medicaid expenditures have found that providing care and supportive services in peoples’ home, as opposed to a nursing home or retirement facility, resulted in savings of $22,588-$49,078 annually per individual.

As we continue the conversation around the housing crisis facing our aging population, it is critically important that we consider the aging-in-place needs of individuals with limited income, and ensure they are included in every solution that is discussed.

 

 

Recordation Tax

mcpsToday, the Montgomery County Council unanimously enacted a bill that will generate funding for additional school construction, County government projects and affordable housing. This is a huge win for Nancy Floreen, a sponsor of the legislation (which will raise about $200 million more than what the County Executive originally proposed over the next six years), Montgomery County Public Schools and the entire community.

Although we can all benefit from additional funding for schools and affordable housing, this bill will also provide rental assistance for low-income residents. While Council President Floreen understands that nobody likes the idea of increasing taxes, she enforces that “our needs are great, and the recordation tax is the most progressive approach to meet the needs our residents have clearly identified as their top priorities”. She also claims that “the recordation tax is just one piece of what I call an ‘education first’ budget that will finally give our students some long-overdue relief.” We thank all of the County Council for working tirelessly and collaboratively to determine a smart solution for generating the needed capital.

The Council’s action on Expedited Bill 15-16 generates about $200 million in Fiscal Years 2017-22 for capital projects, mostly for school capacity and building improvements, despite having to close a shortfall in State aid of more than $24 million. Also, about $5 million in additional revenue will be allocated annually for rental assistance to low and moderate income households.

The recordation tax is paid only when properties are sold or refinanced. The seller and buyer divide the cost evenly if there is no contractual agreement regarding the recordation tax payment. For first-time homebuyers, the seller pays the recordation tax, if there is no alternative agreement in the contract.

Expedited Bill 15-16 will increase the basic rate of the Recordation Tax by $1 per $500 in the sale or refinancing and the Recordation Tax Premium by $0.75 per $500 in the sale or refinancing.

The Tax Premium only applies to sales and refinancing above $500,000. To make the rate change more progressive, the Council raised the exemption for homebuyers from $50,000 to $100,000 for owner occupied homes. For example, the recordation tax on a $300,000 home would rise from $1,725 to $1,780, an increase of $55 (3.2 percent). The Council also delayed the implementation date of the bill to Sept. 1, 2016.

The funds raised by the rate change in the School Increment will be dedicated to MCPS capital projects. The new funds will allow the Council to add nearly $170 million to accommodate school capacity and building improvement needs.

For more information about Expedited Bill 15-16 , click here.