The Montgomery County Council unanimously voted June 20 to cap the county’s development impact tax rate for transportation and public school improvement at 20%. The tax is placed on new development projects in the county to help provide more funding for transportation and public school improvement projects.
The council was required by county law to vote on a cap for the increase after the county’s director of finance, Michael Coveyou, published new impact tax rates as of May 1. The county’s impact tax rate is adjusted yearly based on inflation, in keeping with county law.
Transportation impact tax rates must be calculated “based on the annual average or increase in the published construction cost index inflation over the most recent two calendar years,” according to county staff reports. The school impact tax rate is based on Montgomery County Public Schools “current unit cost of school construction coupled with the student generation rate by housing type,” per county staff reports.
The new rates for transportation will increase by 9.47%. School impact tax rates will increase depending on the type of unit in the development and whether the development is considered to be in an “infill” or “turnover” area. Under these parameters, the rate will go up by anywhere between 41.3% to 129.2%, according to county staff reports.
Click here to read the rest of the article written by Ginny Bixby over at MOCO 360
