HB 149
Department of Legislative Services
Maryland General Assembly
2020 Session
FISCAL AND POLICY NOTE
Third Reader
House Bill 149 (Chair, Environment and Transportation Committee)(By
Request - Departmental - Assessments and Taxation)
Environment and Transportation Judicial Proceedings
Real Property - Ground Leases - Required Notifications - Private Transaction
Redemptions
This departmental bill repeals a requirement for a ground lease holder to promptly notify
the State Department of Assessments and Taxation (SDAT) of a change in the name or
address of a leasehold tenant. The bill also authorizes a leasehold tenant or an interested
party to submit documentation of the redemption of a ground lease to SDAT if specified
conditions are met.
Fiscal Summary
State Effect: The bill does not materially impact State finances or operations.
Local Effect: The bill does not materially impact local government finances or operations.
Small Business Effect: SDAT has determined that this bill has minimal or no impact on
small business (attached). The Department of Legislative Services concurs with this
assessment.
Analysis
Bill Summary: A leasehold tenant or an interested party may submit documentation
satisfactory to SDAT of the redemption of a ground lease if (1) the ground lease is
redeemed in a private transaction between the ground lease holder and the leasehold tenant
and (2) the ground lease holder has failed to notify SDAT of the redemption, as required
under current law. The documentation submitted to SDAT must include a certified copy of
the ground lease redemption deed that has been filed in the land records of the appropriate
county. After accepting documentation, SDAT must update the online registry to indicate
that a ground lease has been redeemed.
Current Law: After a ground lease is registered, the ground lease holder must promptly
notify SDAT of (1) a change in the name or address of the ground lease holder, leasehold
tenant, or person to whom the ground rent payment is sent; (2) a redemption of the ground
lease; and (3) any other information SDAT requires.
SDAT must maintain an online registry of properties subject to ground leases.
Background: SDAT advises that it is already notified of changes to ground rent
registrations pursuant to other statutory provisions. Accordingly, repealing the requirement
for ground lease holders to notify SDAT of changes in the name or address of leasehold
tenants eliminates redundancy. In addition, statutory provisions currently only require a
ground lease holder to notify SDAT of changes to the registration. SDAT advises that
occasionally the ground rent is purchased from a lease holder who fails to notify SDAT
and cannot be reached. Allowing a leasehold tenant or an interested party to provide
appropriate documentation relieves the purchaser of the burden of locating the seller of the
ground rent.
Ground Leases – Generally
Ground leases have been a form of property holding in Maryland since colonial times. A
ground lease creates a leasehold estate in the grantee that is personal – not real – property.
The grantor retains a reversion in the ground lease property and fee simple title to the land.
Ground leases generally have a 99-year term and are renewable perpetually. Ground rent
is paid to the grantor (the ground lease holder) for the use of the property for the term of
the lease in annual or semiannual installments. Under a typical ground lease contract, the
tenant agrees to pay all fees, taxes, and other costs associated with ownership of the
property.
Registration of a Ground Lease
Chapter 290 of 2007 established the registry of ground leases maintained by SDAT. The
registration fee is $10 for the first ground lease and $5 for each additional ground lease,
per ground lease holder.
Remaining Ground Leases in Maryland
As of January 2020, there are 92,419 ground rents registered with SDAT. According to the
registry, ground rents are concentrated mostly in Baltimore City (62,223), with other
ground rents located in Anne Arundel (3,795), Baltimore (25,939), Carroll (11),
HB 149/ Page 2
Cecil (1), Charles (1), Harford (174), Howard (59), Montgomery (5), Prince George’s
(45), and Worcester (166) counties.
Additional Information
Prior Introductions: None.
Designated Cross File: None.
Information Source(s): Baltimore County; Judiciary (Administrative Office of the
Courts); State Department of Assessments and Taxation; Department of Legislative
Services
Fiscal Note History: First Reader - January 31, 2020
md/jkb Third Reader - March 14, 2020
Analysis by: Donavan A. Ham Direct Inquiries to:
(410) 946-5510
(301) 970-5510
HB 149/ Page 3
 ANALYSIS OF ECONOMIC IMPACT ON SMALL BUSINESSES
TITLE OF BILL: Ground Leases – Notifications
BILL NUMBER: HB 149
PREPARED BY: Jason Davidson, 410-767-5754, Jason.davidson2@maryland.gov
PART A. ECONOMIC IMPACT RATING
This agency estimates that the proposed bill:
__X_ WILL HAVE MINIMAL OR NO ECONOMIC IMPACT ON MARYLAND SMALL
BUSINESS
OR
WILL HAVE MEANINGFUL ECONOMIC IMPACT ON MARYLAND SMALL
BUSINESSES
PART B. ECONOMIC IMPACT ANALYSIS
The proposed legislation will not have an economic impact.
HB 149/ Page 4


Statutes affected:
Text - First - Real Property - Ground Leases - Required Notifications - Private Transaction Redemptions: 8-706 Real Property, 8-707.1 Real Property
Text - Third - Real Property - Ground Leases - Required Notifications - Private Transaction Redemptions: 8-706 Real Property, 8-707.1 Real Property