HAGERSTOWN – City officials are preparing to forfeit a state grant awarded in 2021 for the acquisition and rehabilitation of tax-sale properties, with plans to reapply under updated program requirements once the city is better positioned to use the funds.
During the Dec. 9 work session, Chief Housing & Community Development Officer Amanda Gregg, accompanied by Community Development Manager Margi Joe, explained that the Maryland Department of Housing and Community Development advised the city to return the grant and submit a new application rather than seek another extension.
Grant awarded in 2021, but not yet utilized
The grant was meant to support the acquisition and rehabilitation of properties purchased at tax sales, but officials said the city is not yet prepared to fully implement the program. Housing and community development staff told the mayor and City Council that the decision follows months of discussions with DHCD.
While an extension was initially considered, state officials ultimately advised forfeiture and reapplication under revised terms and stipulations.
Legal process being tested on limited properties
City attorneys are currently testing the tax sale redemption process on a limited basis to ensure it is being carried out correctly and without unintended harm to property owners. Staff said the city has initiated the first rights of redemption on a small number of properties as test cases, including one on Clarkson Drive. At the same time, legal notices and service requirements are completed.
More than 20 properties tied to tax sale effort
Once those cases are resolved, officials plan to evaluate the remaining properties involved in the program. The city currently has more than 20 properties tied to the tax sale acquisition effort, and staff emphasized the need to confirm that all procedures comply with state law before proceeding. Officials said forfeiting the grant now does not preclude the city from pursuing similar funding in the future.
Reapplication planned in 2026
The city intends to reapply for the DHCD program in late spring or early summer 2026, when staff believes it will be better prepared to meet program requirements and advance rehabilitation efforts.
The matter will be brought back for formal consideration at a future City Council meeting.
