B 26-0777

Statement of Introduction
    Revenue Stabilization and Land Value Assessment Amendment Act of 2026
  July 14, 2026
  This legislation advances two structural changes to D.C.’s property tax system that
would improve the long-term fiscal health of the District without changing rates or
increasing taxes.
  First, the bill changes the District’s property tax billing and payment cycle from
twice a year to quarterly. Chief Financial Officer Glen Lee has stressed to the Mayor and
Council that the misalignment between when the District receives revenue and when
major expenses must be paid constitutes a “cash flow” or liquidity imbalance. The CFO has
cited these issues as part of his insistence that a significant amount of the District’s
revenue be sequestered in the Fiscal Stabilization Reserve Account.
  While I agree with Chairman Mendelson and the Committee of the Whole’s
assessment that the CFO overstepped the Council’s appropriations authority during the
FY 2027 budget process, these long-term structural imbalances are something for Council
to take seriously.1
  One of the most significant improvements we could make for more consistent annual
cash flow would be to smooth out payments of property taxes. OCFO has indicated that
they are internally looking into what systems would need to be upgraded to allow for this
change; in the meantime, Council should consider enabling legislation, to allow for debate
and public discussion.
  The bill’s second set of provisions would direct future updates the District’s property
tax assessment methodology to ensure accuracy and consistency in land values. While this
would not impact tax rates, it would enable future consideration of a land value tax – where
property taxes are based only on the value of underlying land – or a “split rate” system,
1
 “Report and Recommendations of the Committee of the Whole on the Fiscal Year 2027 Budget and Corresponding
Budget Support Act”, May 22, 2026. Pages 15-16. Viewable at:
https://static1.squarespace.com/static/5bbd09f3d74562c7f0e4bb10/t/6a0f7519b50c144eecf1fa97/17793979156
82/COW+FY27+Committee+Recommendations.pdf
where land and improvements (buildings, other structures) are taxed at different rates. 2
This aligns with proceedings of the 1997, 2014, and 2024 Tax Revision Commissions,3 4 as
well as discussions that took place during the DMV Moves Task Force, focused on
identifying stable sources of regional transit funding.5
  A land-value or split-rate system would improve tax equity and affordability6 across
the District, and – because new construction would not be immediately penalized with a
higher tax burden – would incentivize growth and improvement to the District’s housing
stock, and help to stabilize downtown and commercial real estate recovery.7 8 Both
Maryland and Virginia have authorized a local land value tax at the state level; the District
should follow suit.
  As with Council’s recent directive to OCFO to pursue a feasibility assessment of a
Business Activity Tax,9 it is long past time to lay the groundwork for smart and sustainable
revenue proposals that have been recommended by experts, task forces, and commissions
time and again over several decades.
This is discussed in the 1997 Tax Revision Commission Report (citation below):
  “Under current District tax policy, land and structures are taxed at the same rate and thus it would make
  little sense for the District to put a great deal of effort into developing accurate measures of land values; for
  all practical purposes it makes no difference if we think of a $100,000 property as $25,000 of land and
  $75,000 of structures or $75,000 of land and $25,000 of structures. If the District did adopt a graded tax, it
  would need to determine land values much more carefully and it is quite possible that, as a consequence,
  our view of the distribution of the burden of the tax could change significantly. Nonetheless, we proceed as
  though the valuations of land and structures are accurate.”
3
  “Taxing Simply Taxing Fairly: District of Columbia Tax Revision Commission Full Report. 1997. Available at:
https://cfo.dc.gov/sites/default/files/dc/sites/ocfo/publication/attachments/ocfo_chptg_schwab.pdf
4
  While the 2024 TRC did not release a final set of recommendations, draft recommendations included a policy that
the District “move to [a] system of split-rate ‘land value’ taxation”
5
  “Recycling Transit-Created Land Values: A Proposal for Equity, Affordability, and Sustainability”, Nick. B. Allen,
February 2025. Viewable at:
https://static1.squarespace.com/static/5e2b1d985b55a47841a3cd48/t/67a3c43f40031d2ed14c6dba/1738785861
354/LVT+Report+%281%29.pdf
6
  Ibid.
7
   “Meeting the Washington Region’s Future Housing Needs” Urban Institute. September 2019. Available at:
https://www.urban.org/sites/default/files/publication/100946/meeting_the_washington_regions_future_housing_n
eeds_1.pdf
8
  “Our property tax system rewards neglect and punishes investment in struggling neighborhoods”. Daniel Herriges.
March 11, 2019. Available at: https://ggwash.org/view/71249/property-tax-rewards-neglect-and-punishes-
investment-in-struggling-neighborhoods
9
  Bill 26-0661, the Fiscal Year 2027 Budget Support Act of 2026. Title VII, Subtitle Y (Business Activity Tax Information
and Process Report Act of 2026).
  _____________________________
  Councilmember Brianne K. Nadeau
  A BILL
  _________________________
  IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
  _________________________
1 To amend Title 47 of the District of Columbia Official Code to establish real property tax
2payments on a quarterly basis, and to set forth criteria for the assessment of the market
3value of real property and the independent valuation of land and improvements.
4
5BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
6 act may be cited as the “Revenue Stabilization and Land Value Assessment Amendment Act of
7 2026”.
8Sec. 2. Subchapter II of Chapter 8 of Title 47 of the District of Columbia Official Code is
9 amended as follows:
10(a) Section 47-811 is amended by adding a new subsection (b-1) to read as follows:
11“(b-1)(1) For the tax year beginning July 1, 2028, and each tax year thereafter,
12 real property taxes shall be due and payable quarterly in four equal installments, except as
13 otherwise provided in a payment plan entered into pursuant to § 47-811.05.”.
14(b) Section 47-820(a)(3) is amended as follows:
15(1) The existing test is designated sub-paragraph (A).
16(2) A new sub-paragraph (B) is added to read as follows:
17“(B) For assessments and revaluations in the tax year beginning July 1,
1
18 2028, and each tax year thereafter, the land component of an assessment shall reflect the
19 estimated market value of the land as if vacant and available for its highest and best use and shall
20 not vary between similarly situated and zoned parcels based on the presence, absence, or value of
21 improvements thereon.”.
22(c) Section 477-823(c) is amended to read as follows:
23“(c) The Mayor shall undertake, publish, and otherwise publicize the results of
24 assessment-sales ratio studies for different types of real property for the entire District and for
25 different types of real property within each of the districts utilized in making assessments. Such
26 ratio studies shall include a separate land value component tested against the same accuracy
27 standards as the total assessment. If, for a given year, adequate sales data are lacking for
28 particular studies, the Mayor shall so indicate.”.
29Sec. 3. Fiscal impact statement.
30The Council adopts the fiscal impact statement in the committee report as the fiscal
31 impact statement required by section 4a of the General Legislative Procedures Act of 1975,
32 approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a).
33Sec. 4. Effective date.
34This act shall take effect after approval by the Mayor (or in the event of veto by the
35 Mayor, action by the Council to override the veto), a 30-day period of congressional review as
36 provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December
37 24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)), and publication in the District of
38 Columbia Register.
2