HB 977
Department of Legislative Services
Maryland General Assembly
2021 Session
FISCAL AND POLICY NOTE
Third Reader
House Bill 977 (Prince George's County Delegation)
Environment and Transportation Education, Health, and Environmental Affairs
Prince George's County - Public Safety and Behavioral Health Surcharges -
Behavioral Health Programs
PG 414-21
This bill replaces the public safety surcharge with the public safety and behavioral health
surcharge in Prince George’s County. The bill prohibits the surcharge from being imposed
on residential construction if a preliminary plan for the residential development was
approved on or before July 1, 2005. The bill also expands the authorized uses of the
revenues collected from the surcharge to include (1) the operation of behavioral health
programs offered by the county or (2) the construction or rehabilitation of behavioral health
program facilities in the county. The bill takes effect July 1, 2021.
Fiscal Summary
State Effect: None.
Local Effect: Prince George’s County surcharge revenues materially decrease beginning
in FY 2022, as discussed below. Prince George’s County public safety capital expenditures
may correspondingly decrease in FY 2022 to the extent surcharge revenues used to fund
these projects are reduced by the exemption under the bill and/or diverted to behavioral
health program expenditures. This bill imposes a mandate on a unit of local government.
Small Business Effect: Small businesses and developers who are exempt from the
surcharge may be meaningfully impacted by the bill.
Analysis
Current Law: Prince George’s County may impose, by resolution, a public safety
surcharge on new residential construction for which a building permit is issued by the
county. The surcharge must be paid by the seller at the time a building permit is issued for
the dwelling unit and may not be construed to be a settlement cost. The
Prince George’s County Executive must prepare an annual report on the surcharge on or
before March 1 of each year for the Prince George’s County Council, the
Prince George’s County Senate Delegation, and the Prince George’s County House
Delegation.
Surcharge Amount
Currently, the public safety surcharge imposed on a single-family detached dwelling,
town house, or other multi-unit dwelling is (1) $7,909; or (2) $2,638 for construction in the
developed tier as defined by the Maryland-National Capital Park and Planning Commission
or in an area included in a basic plan or conceptual site plan that abuts existing or planned
mass transit rail station operated by the Washington Metropolitan Area Transit Authority.
The surcharge amount is adjusted each year for inflation based on the Consumer Price
Index for All Urban Consumers. The county council may waive the surcharge on
residential construction that is eligible to receive the reduced surcharge amount.
Single-family detached dwellings built or subcontracted by an individual owner in a minor
subdivision and intended to be used as the owner’s personal residence are exempt from the
surcharge.
Authorized Uses of the Surcharge
Revenue collected under the surcharge must be distributed to police, fire, and emergency
medical services in the county. At least 25% of the revenue collected from a surcharge
imposed on construction that is located in a municipal corporation that maintains a police
department must be distributed to that municipal corporation’s police department. The
revenue collected from a surcharge on construction located in the City of Laurel must be
distributed (1) 50% to Prince George’s County fire and rescue services and (2) 50% to the
Laurel police department for the construction or rehabilitation of public safety facilities or
the purchase of equipment or communications devices used in connection with law
enforcement. The revenue collected from the surcharge may be used only for (1) the
construction or rehabilitation of public safety facilities or (2) the purchase of equipment or
communications devices used in connection with law enforcement, firefighting or certain
emergency services activities.
Local Revenues: Prince George’s County surcharge revenues decrease beginning in
fiscal 2022, to the extent that units are exempted from the surcharge under the bill.
HB 977/ Page 2
Prince George’s County indicates that 871 developments in the county received approval
prior to July 1, 2005, and new construction in those developments would be exempt from
the surcharge under the bill. For example, for every 1,000 units that are exempt from the
higher surcharge, the county would lose $7.9 million in revenue. In fiscal 2020, the county
received $16.1 million in public safety surcharge revenues.
Local Expenditures: Prince George’s County public safety capital expenditures may
decrease in fiscal 2022 to the extent surcharge revenues used to fund these expenditures
are reduced by the exemption under the bill.
The bill also expands the authorized uses for revenues received from the surcharge to
include behavioral health program expenditures and the construction or rehabilitation of
behavioral health program facilities. Therefore, Prince George’s County behavioral health
program expenditures may increase and public safety expenditures may correspondingly
decrease to the extent surcharge revenues are diverted to behavioral health programs under
the bill.
Additional Information
Prior Introductions: None.
Designated Cross File: None.
Information Source(s): Maryland Association of County Health Officers;
Prince George’s County; Maryland Department of Health; Department of Legislative
Services
Fiscal Note History: First Reader - March 15, 2021
rh/tso Third Reader - March 22, 2021
Analysis by: Arnold Adja Direct Inquiries to:
(410) 946-5510
(301) 970-5510
HB 977/ Page 3
Statutes affected: Text - First - Prince George's County - Public Safety and Behavioral Health Surcharges - Behavioral Health Programs PG 414-21: 10-192.11 []
Text - Third - Prince George's County - Public Safety and Behavioral Health Surcharges - Behavioral Health Programs PG 414-21: 10-192.11 []