Good afternoon, everyone.

Welcome to the state legislative work session for the Montgomery County Council and Happy International's Women's Day.

That was yesterday, but we celebrate all month long.

In the whole year, too.

With that, I'm gonna, if I can have council staff to please kick us off on the packet, that will be great.

Thank you.

Okay.

All right.

We'll just uh dig right in, and we've got a couple of um environmental protection bills that I'm gonna ask Garrett to go over.

All right, thanks very much uh for the record.

I'm Garrett Fitzgerald here working for Department of Environmental Protection in collaboration with OIR.

Uh so the first bill that we're gonna talk about briefly is House Bill 1595, Senate Bill 427, property taxes, authority of counties to establish a subclass and set a special rate for personal property of data centers.

So this is a bill that we discussed briefly uh at our meeting two weeks ago.

This is enabling legislation.

This bill would enable the county to establish by law a subclass of personal property consisting of all the personal property of qualified data centers.

It would also authorize the county to set a single special personal property tax rate for all of the personal property of qualified data centers.

So this would enable the county to tax personal property of data centers differently from other uses, should you ever wish to do so.

While municipalities have more flexibility, counties do not currently have broad authority to establish different subclasses of personal property for taxation purposes.

Some precedent has been established over the last couple of years.

There was a bill in 2024 that enabled Baltimore City and County governments to establish by law a subclass of real property consisting of vacant lots or improved property cited as vacant and unfit for habitation and to set a special property tax rate for those properties.

So this is essentially very similar bill, but would apply to data centers.

I'll note that the county can already reduce uh property tax rate on data centers.

There was a bill in 2020 that created a sales and use tax exemption, which allows local governments to reduce or eliminate the percentage of the assessment of any data center personal property used in a qualified data center.

So we do already have a tool to reduce the tax rate on data centers if we wanted to use that.

This bill would do something new, which is giving us a tool that would also allow us to increase that tax rate if we wished to do so.

Um County Executive is in support.

Thank you.

Thank you for that explanation.

I think this bill makes sense.

Well, would you not take the authority of increasing if we want to?

So I will suggest for everybody to say yes to this one.

Okay, without objection, we're gonna go ahead and support this bill.

Thank you.

Thank you.

Uh the other bill from me is Senate Bill 992, public utilities, large load customers registration and demand response program.

Um so this is a bill that was filed late, just came out of rules and is has a hearing on Thursday of this week in triple E in the Senate.

Uh does not have a cross file.

Uh this bill does a few different things.

This might be the bill that moves related to data centers this session.

So it does a few different things, and I'll just tell you about them briefly.

Um the bill directs the public service commission to create a registration process for data centers, requires a financial commitment, as well as the disclosure of plans for other potential development sites they're looking at, including we're thinking about maybe maybe Maryland, maybe also in Ohio or in West Virginia, and would that change our plans for Maryland if we did?

Uh also requires disclosure of planned energy use, backup power systems, water use, do they have control of the site?

Um it's just a registry.

So this portion of the bill does not trigger an action based on the information that that is um disclosed.

However, the information might be helpful for state and local entities to better plan for the energy demands of data centers and other impacts.

The financial commitment that's there might help to make sure um help us to make sure that these are serious projects that we are including in the energy forecast for Maryland.

There's a lot of speculative development in this industry, so give us a little better sense of uh whether a project is really likely to move forward.

Uh the bill also creates a voluntary demand response program, enables participating data centers to qualify for a sales and use tax exemption.

Um, but maybe the most impactful part of the bill, um, it does a couple of interesting things.

So the bill creates some additional financial protections for other kinds of ratepayers, which is something that we hear a desire for frequently.

Um for example, if a utility which which serves a territory, including at least one uh large load customer, essentially a data center, uh, receives an order from PJM to curtail energy use.

Uh the other piece is any financial obligation that is assigned to an electric company as a result of a new data center, a new large load customer connecting to the grid must be passed on to that large load customer, not to everybody else.

So these are a couple of steps that would be uh potentially significant protections for existing ratepayers.

Um and the county executive is in support of that bill.

Yeah, thank you so much for uh for describing this bill.

I also think it's common sense just as the previous one.

Um and I think before I turn it to Council Vice President Marilyn Balcombe.

I think this is an example, this past dual bills, an example of how we have the state delegation, because I see many of our state delegates us sponsors of these bills, they're proactive in ensuring that we're getting information and they're working um together towards uh positive solutions regarding data centers.

So that's a positive thing.

Uh with that, Council Vice President.