Baltimore City’s decades-old vacancy problem may soon face a formidable opponent. This week, the Baltimore City Council approved a plan to tax vacant and abandoned homes at a higher rate, sending the legislation to Mayor Brandon Scott for final approval.
The Council unanimously co-sponsored the legislation, which sets a tax rate three times higher than the standard property tax for the 2026-2027 tax year, increasing to four times the standard rate in subsequent years. Specifically, the rate will start at 6.744 percent per $100 of assessed value and rise to 8.992 percent per $100 afterward.
Council Member Odette Ramos, a leading proponent, noted that the proposal aims to increase liens on vacant properties to the point where they qualify for the judicial in rem foreclosure process. This legal mechanism would allow Baltimore to take possession of neglected properties, potentially transforming the landscape of over 10,000 abandoned structures.
“The potential of the City acquiring properties through in rem is game-changing, said Council Member Ramos. This tax isn’t about raising revenue but creating real momentum to transform vacant structures into thriving, mixed-income communities.”
Years in the Making, Legislative Hurdles Finally Overcome
This tax rate initiative marks a significant milestone after years of legislative hurdles. From 2010 to 2023, state lawmakers representing Baltimore City pushed for enabling legislation but faced setbacks. The breakthrough came in 2024 with HB 2, largely due to MACo’s persistent advocacy.
HB 2 authorizes all 23 Maryland counties and Baltimore to create a special property class for taxing vacant homes. What started as a Baltimore-only measure expanded statewide following MACo’s effective push in House Ways and Means Committee deliberations.
Securing this statutory authority was crucial, given Maryland’s constitutional uniformity clause mandating equal tax rates across property classes. Now, counties have a practical tool to reduce vacancies and promote housing solutions tailored to their needs.
Addressing Implementation Details and Protecting Active Investors
Baltimore City must still finalize several details for regulating and implementing the vacant property tax.
Notably, the goal isn’t to penalize those who are actively investing in the City—like developers working on major redevelopment projects or small-scale property owners rehabilitating a few homes at a time. However, since the state legislation does not specify exceptions to the tax, Baltimore’s local legislation currently has no way to grant exemptions.
One reason the tax won’t take effect until the 2026-2027 tax year is to give time for the Department of Housing and Community Development (DHCD), the Department of Finance, and the Mayor’s Office to develop effective programs. Potential measures include a robust lien release program that encourages proper use of building permits to remove vacant building notices after rehabilitation or a grant or rebate program to offer relief where appropriate.
Stay tuned to Conduit Street for more information.
