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SB 235

An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in city revitalization and improvement zones, further providing for approval.

2025-2026 Regular Session Introduced by Dave Argall and 5 co-sponsors

SB 235 creates the Project Restore Program in DHCD to fund subgrants that help nonprofits and local governments activate vacant commercial spaces in sustainable communities.

Referred to Community, Economic & Recreational Development
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Bill Summary · SB 235

SB 235 — Housing and Community Development — Project Restore Program (Maryland)

Status: Introduced Jan 8, 2025 (Dept. of Housing & Community Development request). Effective date: July 1, 2025.

Purpose / Intent

SB 235 codifies and formalizes the "Project Restore" program within the Maryland Department of Housing and Community Development (DHCD). The program’s stated goal is to assist place‑based community organizations and local governments to activate and revitalize vacant commercial and retail properties in sustainable communities, supporting small businesses and local economic or historic preservation efforts.

Key provisions

  • Establishes a new Subtitle 14 (Project Restore Program) in the Article — defines program terms (place‑based community development organization, qualified applicant, qualified entity, subject property, sustainable community, vacant property).
  • Creates the Project Restore Program in DHCD and authorizes DHCD to distribute program funds to:
    • Qualified applicants: place‑based nonprofit development organizations and units of local government that serve in designated sustainable communities and apply for funds.
    • Each qualified applicant that receives funds must distribute subgrants to qualified entities (businesses or nonprofits located in a sustainable community that plan to improve a vacant property and be operational within the subgrant term).
  • Eligible uses of subgrants (examples):
    • Rental payments toward leasing a subject (vacant) property
    • Renovation/repair of interior and exterior of subject property
    • Purchase of furniture, fixtures, and equipment
    • Purchase of the subject property by a qualified entity
  • Administrative allowance: DHCD may permit a qualified applicant to use up to 15% of awarded program funds for salaries and other operating costs.
  • Regulatory authority: DHCD may adopt regulations to implement the program.

Who is affected

  • Nonprofit, place‑based community development organizations (grant intermediaries)
  • Units of local government in sustainable communities
  • Small businesses and nonprofits seeking to occupy and improve vacant commercial properties (subgrant recipients)
  • DHCD (administration and rulemaking)
  • State budget (see fiscal impact below)

Fiscal impact / timeline

  • Fiscal note: General fund expenditures increase by $10.0 million annually beginning in FY 2026 (Department of Legislative Services estimate). No direct revenue impact.
  • The bill takes effect July 1, 2025.

Context / background

Project Restore was launched by the Hogan administration in 2021 using federal American Rescue Plan Act funds (initial $25 million). The program previously awarded rental grants and business operations grants to incent commercial occupancy of vacant storefronts. SB 235 codifies the program structure and authorizes DHCD to administer future funding and subgranting according to the statutory framework above.

Potential impacts

  • Positive: Direct financial support to activate vacant commercial spaces; support for small businesses; local economic and historic district revitalization; possible leveraging of private investment.
  • State budget: requires ongoing general fund appropriations (estimated $10M/year starting FY 2026 in the fiscal note).
  • Local governments and community organizations may see increased grant flows and administrative responsibilities.

Compiled from official sources — confirm details with the bill’s official record.

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