BALTIMORE COUNTY COUNCIL

NOTES TO THE AGENDA

LEGISLATIVE SESSION 2017

Issued: March 23, 2017

Work Session: March 28, 2017

Legislative Day No. 7 : April 3, 2017

The accompanying notes are

compiled from unaudited

information provided by

the Administration and

other sources.

OFFICE OF THE COUNTY AUDITOR

BALTIMORE COUNTY COUNCIL

April 3, 2017

NOTES TO THE AGENDA

TABLE OF CONTENTS

Mr. Quirk (By Req.)

Office of Law

Electronic Control Device Law – Repeal

Bill 12-17 proposes to repeal Section 17-2-104 of the Baltimore County Code, 2015. This statute prohibits the use, possession, discharge, sale, rent, or transfer of an electronic control device, referred to as a taser.

Attached is a copy of a comprehensive executive summary that explains the reason for the repeal.

Upon approval and enactment, Bill 12-17 will take effect immediately as an emergency measure.

Colonel Alexander Jones Fiscal Note April 3, 2017

MB-2 (Res. 32-17) Donation Council District(s) _All_

Mr. Quirk (By Req.)

Police Department

Accept a Gift from National Insurance Crime Bureau

Resolution 32-17 authorizes the County to accept the donation of a 2007 Acura MDX, valued at $9,675, from the National Insurance Crime Bureau (NICB). NICB is a not-for-profit organization that partners with insurance companies and law enforcement agencies to facilitate the identification, detection, and prosecution of persons committing crimes of concern to the insurance industry, such as vehicle thefts. See Exhibit A.

The donor requires that the vehicle be assigned to the Regional Auto Theft Task (RATT) Force and be used solely to combat auto theft. RATT works in conjunction with the Baltimore City Police Department to reduce the incidence of automobile theft in the Baltimore Metropolitan area. RATT will use this vehicle in street and investigative operations and will replace a previously donated vehicle used for a similar purpose that was removed from service in February 2016.

The Department advised that gasoline ($1,200) and maintenance/repairs ($6,800) for the vehicle will cost approximately $8,000 annually and will be paid through the Maryland Vehicle Theft Prevention Grant.

County Charter, Section 306, vests in the County Council the power to accept gifts.

This resolution shall take effect from the date of its passage by the County Council.

Will Anderson Fiscal Note April 3, 2017

MB-3 (Res. 33-17) Council District(s) _3_

Mr. Quirk (By Req.)

Department of Economic and Workforce Development

Support of Conditional Loan

The Administration is requesting the endorsement of a project and a corresponding Maryland Department of Commerce, Maryland Economic Development Assistance Authority and Fund (MEDAAF) conditional loan of up to $2,000,000 to assist in the retention of McCormick & Company, Inc., including the relocation of and improvements to its corporate headquarters to be located at 99 Shawan Road in Hunt Valley. See Exhibit A.

Fiscal Summary

This resolution has no fiscal impact to the County since MEDAAF is a State program. As a condition for providing assistance to the project, the State requires a local government resolution supporting the project and a minimum 10% matching County conditional loan. In February 2017, the Council approved a $200,000 conditional loan to McCormick & Company, Inc. through the 7-day loan notification process as financial assistance for this project.

Analysis

McCormick & Company, Inc. manufactures and distributes spices, seasoning mixes, condiments, and other food products. The Department advised that McCormick & Company, Inc. was searching to relocate its Sparks-based corporate headquarters and was considering locations within Baltimore County, the State of Maryland, and other states; ultimately, in April 2015, the company decided to consolidate its employees from its corporate headquarters and various buildings in Hunt Valley and Sparks to 99 Shawan Road in Hunt Valley. Estimated project costs to redevelop the space into an over 300,000 sq. ft., LEED Gold-Certified facility total $10 million.

MB-3 (Res. 33-17) (cont’d) April 3, 2017

The Department advised that renovations began in 2016, and the relocation is anticipated to be completed in April 2018.

This resolution endorses the project and a corresponding MEDAAF conditional loan of up to $2,000,000 as financial assistance for the project.

As a condition for providing assistance to the project, the State requires a local government resolution supporting the project and a minimum 10% matching County conditional loan. In February 2017, the Council approved a $200,000 conditional loan to McCormick & Company, Inc. through the 7-day loan notification process as financial assistance for this project. The Department advised that the County will also provide infrastructure improvements totaling $1.8 million to Shawan and Schilling Roads to facilitate safe access to the McCormick building for vehicles and pedestrians.

The Department advised that the objective of the financial assistance is to support the retention of McCormick & Company, Inc.’s corporate headquarters and to obtain a commitment from the company to retain its existing workforce of 800 personnel through 2024.

The Department advised that both the State and County conditional loans have 7-year terms with 3% interest rates. In order for the loans to be forgiven at the end of the 7-year terms, the company is required to retain its existing workforce of 800 personnel at the corporate headquarters and 1,900 total jobs in Maryland. If the company falls short of the employment goal, the amount of the loans that will be converted to grants will be calculated on a pro-rata basis, and the company will be responsible for repaying the remaining loan balances.

This resolution shall take effect from the date of its passage by the County Council.

Andrea Van Arsdale Fiscal Note April 3, 2017

MB-4 (Res. 34-17) PILOT Council District(s)_1_

Mr. Quirk (By Req.)

Department of Planning

Payment-In-Lieu-of-Property-Tax – Dogwood Towns LLC

Resolution 34-17 authorizes the County to enter into a 10-year agreement with Dogwood Towns LLC for stipulated payments-in-lieu-of-real-property-taxes (PILOT) in order to provide financial assistance for a rental housing project to be located at 7301 Dogwood Road in Windsor Mill. The agreement shall be effective July 1, 2018. See Exhibit A.

Fiscal Summary

Funding Source	Property Tax Reduction
County	$ 1,761,432	⁽¹⁾
State	—
Federal	—
Other	—
Total	$ 1,761,432
⁽¹⁾ Estimated net present value of property tax loss over the 10-year term of the PILOT agreement.

Analysis

Dogwood Towns LLC will acquire property located at 7301 Dogwood Road in Windsor Mill and construct a rental housing development. The Development, named Towns at Woodfields, will include 61 two-story townhome units. Each unit will provide approximately 1,600 sq. ft. of space and include four bedrooms and two full bathrooms. The units will be reserved for persons whose

MB-4 (Res. 34-17) PILOT (cont’d) April 3, 2017

incomes do not exceed 60% of the area median income ($52,020 for a family of four). Five units will be reserved for persons with disabilities. The Department anticipates that the property sale and the commencement of construction will occur in April 2017, and the construction will take 14 months to complete.

Resolution 34-17 authorizes the County to enter into a 10-year PILOT agreement (effective July 1, 2018) with Dogwood Towns LLC with payments-in-lieu-of-taxes in the amount of $300 per unit in the first year; increasing 3% per year in the second through the fifth years; $400 per unit in the sixth year; and increasing 3% per year in the seventh through the tenth years. (If the property is transferred or sold subject to the governing Declaration of Covenants and the PILOT agreement, the annual payments will increase by 4%.) The PILOT agreement will reduce County real property tax revenue for the earlier of 10 years or as long as the developer continues to maintain the affordability restrictions of the 61 units. The PILOT agreement states that the property owner shall make annual payments at the end of each calendar year, and the tax payment shall be made prior to payment of any debt service on the property. Payments in the first year after project completion will total $18,300 ($300 per unit for 61 units). Estimated PILOT-generated revenue is $193,081 less than the estimated County property tax revenue amount in the first year. PILOT-generated revenue is estimated to be a net present value amount of $1,761,432 less than the County property tax amount over 10 years (assuming that payments are $300 per unit in the first year; payments increase 3% per year in the second through the fifth years; $400 per unit in the sixth year; payments increase 3% per year in the seventh through the tenth years; the assessed value of the property is equal to the project cost of approximately $19.2 million; property value increases by 3% each year; and the present-value discount rate equals 5% per year). Should the property no longer maintain its affordability restrictions, Dogwood Towns LLC will be liable for all foregone County property taxes.

The Annotated Code of Maryland, Tax-Property Article, Section 7-506.1 exempts certain subsidized rental housing projects from property taxation if the owner and governing body of the County agree to negotiated payments-in-lieu-of-real-property-taxes.

MB-4 (Res. 34-17) PILOT (cont’d) April 3, 2017

Estimated project costs total approximately $19.2 million and will be financed as follows:

Tax-Exempt Bonds	$ 7,740,000
Federal Low Income Housing Tax Credits	5,383,195
Baltimore County Conditional Loan	3,500,000	*
Maryland Department of Housing and Community Development Rental Housing Funds	2,500,000
Developer’s Equity	93,218
Total	$ 19,216,413
* Approved through the 7-day loan notification process in September 2016.

This resolution shall take effect from the date of its passage by the County Council.

BALTIMORE COUNTY COUNCIL

NOTES TO THE AGENDA

APPENDIX A

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Wade Kach