Maryland Housing Expansion and Affordability Act – The Basics 

Welcome to the first installment of our series dedicated to unraveling the complexities of recent and potential state-level urban and community planning policy. State regulations establish the framework for local planning activities and are constantly evolving. We believe that understanding these laws is crucial for anyone interested in the future of our cities and communities. So, whether you are a local government official, city planner, developer, community activist, or just a curious citizen, we hope this series will provide valuable insights. 

We first delve into the Maryland Housing Expansion and Affordability Act (HB538), a piece of legislation that the Maryland General Assembly approved on April 9th, 2024, and is expected to soon be signed into law by the Governor. The law aims to expand housing construction, particularly affordable housing, by lessening local zoning and permitting barriers. It requires all local jurisdictions in the state to ensure that their regulations follow three main components.  

1. Allow increased densities and uses in specified zoning areas for “qualified projects,” which include specified amounts of affordable housing.
2. Prohibit the imposition of unreasonable limitations or requirements on a qualified project or require a qualified project to be reviewed at more than a specified number of public hearings.
3. Allow new manufactured homes and modular dwellings in zones that allow single-family residential uses.

Why is this important?  

Maryland has an estimated housing shortage of 96,000 units, and over half of Maryland renters spend 30% or more of their salaries on housing.  Due to the urgent nature of this housing conundrum and the complexities of local housing development, addressing zoning and permitting barriers is increasingly becoming one of the pieces of the puzzle.  

What projects qualify and where? 

Residential projects qualify for increased densities if they are new construction or substantial renovations in one of the following locations:  

• Property within three-quarters of a mile of a rail station located in the state.
• Property formerly owned by the state.
• Land wholly owned by a nonprofit organization or includes improvements owned by an entity controlled by a nonprofit organization.

In each case, the project must contain a percentage of dwelling units affordable to households earning 60% or less than the area median income: 15% affordable near rail stations and 25% affordable for nonprofit and former state-owned land. These units must remain affordable for at least 40 years. 

What are the increased densities and uses?  

If a project meets the criteria above, local jurisdictions must allow a qualified project’s density to exceed that otherwise authorized in a district or zone as follows – A qualified project in an area zoned for:  

• Single-family residential use may include middle housing units (duplexes, triplexes, quadplexes, cottage clusters, or townhouses.) Please note, however, that a late amendment to the bill excluded single-family zoned properties upzoning from areas near rail stations.  
• Multifamily residential use receives a density bonus of 30% and may consist of mixed-use.
• Nonresidential use may consist of mixed-use, with density limits that do not exceed the highest allowable density in the local jurisdiction’s multifamily residential zones.
• Mixed-use may include 30% more housing units than are allowed in that zone.  

How does the law protect these projects from other local barriers? 

The bill outlines deviations from the following traditional planning regulations and procedures for qualified projects: 

1. No imposition of any unreasonable limitation or requirements concerning height, setback, bulk, parking, loading, or other similar requirements; and
2. A maximum of one public hearing may be required before each of the following:
   • The local governing body
   • The planning commission
   • A historic district commission or historic preservation commission
   • The board of appeals. 

Keep an eye out for subsequent pieces of the puzzle where decoding housing policies continues!

Contact Our Team

For more information on Maryland’s Housing Expansion and Affordability Act or expert support in planning your next urban and community planning project, Contact Our Team!