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Bethesda developers push for refunds after taxing snafu

By WTOP Staff

Solaire Bethesda, rendering via Washington Property Company

Some local developers want refunds from Montgomery County, claiming they were improperly charged a decades-old parking tax despite building projects that should’ve been exempt.

Last Thursday, the County Council’s Transportation Committee recommended approval by a 3-0 vote of a bill that would let the developers apply for the Parking Lot District tax exemption retroactively. The county executive’s office is urging the Council not to pass the bill, saying it was the property owners’ responsibility to apply for the exemption by April 1.

According to Bethesda-based land use attorneys Bob Dalrymple and Anne Mead, developers StonebridgeCarras, Washington Property Company, Home Properties, Southern Management Corp. and others were surprised to discover a few months ago that they weren’t receiving the exemptions from the PLD tax that they thought they were.

The PLD tax is charged to developers in the Parking Lot Districts of Bethesda, Silver Spring, Wheaton and Silver Spring that don’t include a certain amount of on-site parking in their projects. The PLD taxes go toward maintaining the county’s parking lots, curbside spaces and garages.

But in written testimony provided to the Council, Dalrymple, Mead and Washington Property Company President Charles Nulsen said developers couldn’t tell they were incorrectly being charged the tax because it was “embedded” in the property tax that appears in a lump sum on annual tax bills.

“We quickly learned that not only were the Named Clients unaware that they were not receiving the lawfully entitled exemptions (which is especially alarming since they all routinely have in place a detailed review of all property tax invoices by in-house and outside tax advisors), but also that the manner in which the PLD tax is levied and collected, and the lack of any clear direction to property owners advising of the possibility that exemption from the PLD tax might be legally entitled, combine to make the PLD taxation system and process an unmitigated disaster,” Dalrymple wrote.

In simpler terms: “In it’s worst light, it can be described as bureaucratic theft,” wrote Nulsen.

The new Lot 31 garage being built by Bethesda-based developer Stonebridge CarrasJoseph Beach, director of the county’s Department of Finance, disagreed and County Executive Isiah Leggett is against passage of the bill that would re-open the window for property owners to apply for the PLD tax exemption.

Besides the fact that it’s the responsibility of the property owners to apply for the exemption, Beach wrote that refunding PLD taxes could create worse financial issues for Bethesda’s already faltering Parking Lot District.

The Bethesda PLD has more than $47 million in outstanding revenue debt.

“Taking an action that calls in to question the County’s compliance with this covenant and that impedes this security for bond holders weakens market confidence in the existing debt and weakens the County’s overall credit profile in the municipal market,” Beach wrote it testimony to the Council.

Nulsen said he spent more than $4 million building parking above the PLD requirement at his Solaire Silver Spring project and the county acknowledged its compliance during Planning Department review.

Nulsen, whose company is building the Solaire Bethesda apartment project with a two-level underground garage, said the county taxed him for non-compliance for two years without his knowledge at a rate of about $240,000 a year.

“This inaccurate tax cost me not only $480,000 in cash, but impacted my permanent financing by millions of dollars,” Nulsen wrote. “It is impossible to see that you are being charged a PLD tax. This fact is highlighted by a thorough survey of tax payers in the PLD districts. The same taxpayers receive PLD credits on some properties, but incorrectly pay PLD taxes on other properties. It is simply not a conscious decision.”

Councilmember Nancy Floreen, who introduced the bill with co- sponsors Roger Berliner, Hans Riemer and George Leventhal, took the Council staff recommendation to approve the measure.

The Council, which is on recess until Nov. 25, is expected to vote on the bill in one of its three remaining regular sessions of the year.

On Thursday, Berliner said his Transportation Committee would be taking a separate look at how to improve the financial health of the Bethesda PLD.

“In my conversations, there is no opposition to increasing the PLD tax in order to ensure revenue going forward,” Berliner said.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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