Maryland overrides municipal zoning on transit development

Maryland’s legislative and executive branches are about to tell cities and counties what they can – and cannot – do with parcels of land sitting next to their rail stations.

Gov. Wes Moore is expected to sign the Maryland Transit and Housing Opportunity Act, a bill that overrides local zoning rules near rail transit.

It eliminates parking minimums and unlocks state-owned land for housing. His administration says unlocking 300 acres of state-owned land will lead to the development of more than 7,000 new housing units and nearly $1.4 billion in new tax revenue.

The bill reflects a broader override of local zoning impediments to new housing production – and a series of retaliatory skirmishes among local jurisdictions – playing out in statehouses across the country.

California Gov. Gavin Newsom signed legislation last October requiring higher densities near transit in the state’s densest urban counties. Colorado, Montana and Florida have passed similar zoning preemption measures in recent years. Policymakers in both parties increasingly blame local zoning restrictions for the national housing shortage.

Moore introduced the bill in January, along with two other zoning reform measures, as part of a broad housing package. His administration has pegged Maryland’s housing shortage at a “conservative” 96,000 units.

It overcame a challenge from a competing bill introduced by the Maryland Association of Counties – dubbed BAMBY, for Build Affordably in My Backyard.

The other two bills met with mixed outcomes. The Starter and Silver Homes Act died in committee – a quiet but significant win for local resistance. It would have legalized smaller single-family homes on smaller lots and permitted townhouses statewide.

Moore’s Housing Certainty Act also awaits his signature.

This bill locks in zoning rules in effect when a complete development application is submitted, shielding approved projects from later rule changes. It also defers the collection of impact fees until a certificate of occupancy is issued, giving would-be residential developers the regulatory certainty that developer- and investor-side backers say will lower costs and attract investment.

Unlocking transit land

Moore’s transit-oriented development bill takes effect Oct. 1, 2026. It bans local governments from imposing minimum off-street parking requirements on residential or mixed-use projects within a quarter-mile of a qualifying rail transit station – one that provides at least hourly service Monday through Friday between 8 a.m. and 6 p.m. Within a half-mile, local zoning must permit mixed-use development on land designated for residential or appropriate commercial use.

The bill auto-designates qualifying transit-oriented development areas as enterprise zones, unlocking a 10-year local property tax credit. Developers pay local development impact fees only after receiving a certificate of occupancy.

A Maryland Department of Transportation analysis found that restrictive zoning on state-owned, transit-adjacent land in the Baltimore region alone effectively blocks the construction of thousands of housing units.

Moore made Baltimore a centerpiece of his TOD push. He held a joint press conference in April with Mayor Brandon Scott to unveil a Baltimore Region Transit-Oriented Development Strategy. They also announced the first step toward finding a development partner for nine acres near a transit station currently used as a parking lot.

“We have said from the beginning that if this is going to be Maryland’s Decade, it has to be Baltimore’s Time,” Moore said. “Part of making that real means making sure our investments in Baltimore’s Metro and Light Rail System lead to opportunity — opportunity to live near transit, opportunity to strengthen communities near transit, and opportunity to create work, wages, and wealth near transit.”

Scott said the effort is a deliberate reversal of decades of disinvestment.

“For generations, restrictive housing and transportation policies were intentionally used to limit opportunity and investment in so many of our neighborhoods,” he said. “Today, the opposite is true.”

Counties push back – then pull back

The Maryland Municipal League supported the goal of transit-oriented development and the growth of rail-adjacent housing. But it warned that automatic enterprise zone designation forces a 10-year property tax break on municipalities without their consent.

“We also expressed concern that delaying impact fee collection shifts infrastructure financing risk to local governments,” MML wrote.

It submitted amendments for consideration.

The Maryland Association of Counties pushed its own alternative. BAMBY would have preserved significant local zoning control while still boosting production. The association framed the legislation as a middle path between “not-in-my-backyard” resistance and full state preemption. It proposed bundling tax tools along with land-use changes and landlord-tenant rules that kept counties in the driver’s seat.

A standoff never fully materialized. By late March, counties had narrowed BAMBY to two provisions. It would create a registry for landlords and an accelerated approval process for routine permits in jurisdictions that have identified a housing shortage. It passed the Senate overwhelmingly but stalled in a House committee.

MACo also pushed for clarifying amendments to the transit bill “to ensure proper implementation and recognize on-the-ground realities of infrastructure capacity, local planning consistency, and predictable administration.”

Next year’s legislative session could bring changes. Other states have revised similar laws as implementation realities emerge – or local resistance resurfaces.