Editor’s note: This story was originally published at 5:17 p.m. on April 8, 2025. It was updated at 8:18 on April 8, 2025 to correct eligibility information for the “payment in lieu of taxes” pilot program that originally appeared in a council staff report and was later amended by committee.
The Montgomery County Council unanimously passed a zoning text amendment (ZTA) Tuesday that will expedite the process for commercial-to-residential building conversions, which was proposed as part of the More Housing N.O.W. (New Options for Workers) legislative package sponsored by several councilmembers.
The legislative package aims to allow more residential building types – including duplexes, triplexes, townhomes and apartments – along the county’s transit corridors, with a requirement that 15% of the housing serve the local workforce. The goal of the legislative package is to increase access to more affordable workforce housing through two zoning text amendments (ZTAs), a subdivision regulation amendment and one bill that would change how developers of specific affordable housing projects are taxed.
The legislation was formally introduced by councilmembers Andrew Friedson (D-Dist.1) and Natali Fani-González (D-Dist. 6) in early February. It is co-sponsored by council President Kate Stewart (D-Dist. 4) and councilmembers Laurie-Anne Sayles (D-At-large), Marilyn Balcombe (D-Dist. 2) and Dawn Luedtke (D-Dist. 7).
Before the council vote on the proposed ZTA, Fani-González said she and the legislation’s other sponsors were looking to update zoning laws to specifically address the county’s housing affordability crisis.
“Once you convert these empty or half-empty office buildings, you’re going to have people moving in. They’re going to have to be paying impact taxes. They’re going to have to be paying income taxes,” she said. “The investment is huge, and this is nothing new. We have other jurisdictions already doing this. [Washington,] D.C., is one of them.”
The council also voted 10-1 to approve legislation that would establish a “payment in lieu of taxes” pilot program for any residential development approved under the proposed conversion ZTA that fulfilled the requirement of providing 17.5% or more moderately-priced units at 60% of the county’s area median income (AMI). This means that qualifying developments would be exempt from 100% of the real property tax that would otherwise be levied for a period of 20 years. The intent is to encourage developers to convert office and commercial buildings to affordable units.
The council voted Tuesday to amend the original proposal and increase the moderately-priced housing requirement. Under the original version of the legislation, developments would have had to providing 15% or more workforce housing to qualify for the exemption, and the exemption would have been applicable for 25 years.
Council Vice President Will Jawando (D-At-large) was the sole dissenter. Jawando has been critical of several aspects of the More Housing N.O.W. legislative package, voicing concerns that it would not actually create affordable housing.
“The question is, what are we getting? [I’m] not against the conceptual idea here,” Jawando said. “But are we subsidizing high-end, mostly market-rate luxury apartments? … We shouldn’t be subsidizing, in my view, without getting deeper levels of affordability.”
Jawando proposed several amendments to both pieces of legislation, all of which failed to move forward.
Councilmember Gabe Albornoz (D-At-large) said he supported the legislation because he saw it as a step in the right direction.
“I’m going to say the quiet part out loud. One of the reasons why we have to take swings like this is because of policies that we’ve enacted over several councils with the best of intentions that we have to look at and analyze to ensure that we aren’t creating more problems than we’re trying to solve,” Albornoz said. “Am I comfortable with everything that’s been proposed? No, I’m not. But on our watch, we have to do what we can, to do things that make a lot of common sense, and to me, that fundamentally is what this effort is trying to do.”
The council did move forward with amendments to the originally proposed ZTA presented by Fani-González to prevent small retail businesses from being negatively impacted by the zoning changes.
According to the sponsors, the More Housing N.O.W. legislative package was inspired by public conversations concerning the highly controversial Attainable Housing Strategies Initiative proposed by the county Planning Board in 2024, but not based on that proposal. The Attainable Housing Strategies Initiative outlines recommendations to the council for zoning changes to allow more housing options in some single-family home zones in targeted areas of the county.
The More Housing N.O.W. legislative package has also been controversial among community members, with supporters praising its aim to increase the county’s housing supply, but critics voicing concerns that more development would encroach on existing neighborhoods.
County Executive Marc Elrich (D) has been vocal in his vehement opposition to the legislative package, arguing that market-rate housing is already being built in the county without the legislation.
“The idea that we would subsidize what’s being built all the time is just flat-out ludicrous. But also the idea that this is something special that solves a problem when this is the housing that’s actually being built, that’s a bit of a logical problem,” Elrich said following the introduction of the legislation in February.
Elrich does not have the authority to veto ZTAs but could veto the “payment in lieu of taxes” legislation. A spokesperson for Elrich did not provide a response Tuesday afternoon as to whether Elrich will veto that legislation.
