2026 will likely be remembered as the first session of affordability, with cost-of-living issues at the very top of the General Assembly’s legislative agenda.
The two main focus areas were energy and housing policy, as costs in both areas have been growing faster than inflation and taking up an increasingly larger share of household budgets. On the housing front, the central bill passed by legislators was the Housing Certainty Act or HCA (HB548/SB325), which made a series of process and regulatory reforms intended to lower the cost of development.
The Housing Certainty Act is primarily divided into two distinct parts. Part I focuses on local regulatory and review procedures for housing development applications, while Part II places new restrictions on when and how counties assess impact fees and excise taxes.
Part I: Local Regulatory Procedures
New Standardized Definitions
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Traditionally, local governments in Maryland have had the authority to establish terms, definitions, timelines, and related procedures consistent with the development review process created by the local government. The HCA creates six new definitions that will become standard for all county residential development after October 1, 2026.
- “Complete Application” means a housing development project application that includes all materials and information required for processing and substantive review as determined by the commission or the local regulatory authority, but may contain nonsubstantive errors, omissions, or similar inconsequential deficiencies.
- “Housing Construction Permit” means a building permit required by a local regulatory authority or the commission to commence or continue the construction, substantial renovation, or improvement of residential real estate.
- “Housing Development Project” means the new construction or substantial renovation of a residential real estate project.
- “Housing Development Project Application” means an application for a building permit, certification, authorization, site plan approval, subdivision approval, conceptual plan, or any other determination by a local regulatory authority or the commission relating to a housing development project that has been submitted to a local regulatory authority or the commission in compliance with applicable requirements
- “Phase” means a discrete, planned portion of a larger housing development project that:
- Is constructed independently of and sequentially with other portions of the project;
- Includes 25 or more housing units; and
- Includes any improvements necessary
- “Phased Development Plan” means a subdivision or site plan in which the applicant proposes to develop a property in 2 or more individual phases over a period of time.
Regulatory Certainty
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One of the most significant sections of the bill mandates that counties may only evaluate applications for residential development based on the standards in place at the time of complete application submission. Prior to enactment of the HCA, counties could change development regulations even after a project had been submitted. That authority allowed for flexibility, particularly when conditions on the ground changed substantially due to local infrastructure, planning, environmental, or community factors.
Developers argued, however, that this flexibility created uncertainty, making financing harder to secure when lengthy regulatory reviews and shifting standards made projects more difficult to advance. After October 1, 2026, projects may only be evaluated based on the standards in place at the time of complete application submission, regardless of subsequent changes in local law. State laws are exempted from this provision.
Completeness Reviews
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Because completeness is critical to the regulatory certainty provisions outlined above, counties are now required to review applications within 30 days after receipt to determine whether the application is complete. Counties must then notify the applicant of that determination, and, if necessary, provide a list of deficiencies within 35 days. If a county fails to notify an applicant within 35 days, the application will be deemed complete.
Vested Rights
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Once an application has received all required approvals, the proponent of the project has a new vested right to the authorized uses for a minimum of five years, unless a longer approval period is granted by the county. Compliance with this section may require significant reconfiguration of county-level review and regulatory regimes, as some jurisdictions currently provide approvals for periods shorter than this threshold based on shorter-term capacity calculations.
Part II: Impact Fees & Excise Taxes
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Prior to enactment of the Housing Certainty Act, counties had broad discretion to set impact fee and excise tax payment schedules based on what best suited the needs of their communities. After October 1, 2026, counties may not assess these fees or taxes until construction of a residential real estate project is complete and the project meets all requirements to receive a certificate of use and occupancy permit or local equivalent.
Counties may require payment of all applicable fees as a precondition of issuing a use and occupancy permit, provided that the inspection is conducted within 30 days.
This article is part of MACo’s Policy Deep Dive series, where expert policy analysts explore and explain the top county policy issues of the day. A new article is added each week – read all of MACo’s Policy Deep Dives.
