A group of state legislators has proposed new ground rent rules that would prevent owners from collecting payments if they don't register properties with the state, an attempt to deal with an appeals court ruling that left an earlier registration law in limbo.
Ground rent is a quirk in Maryland's property system that gives owners of the leases an interest in the land under tens of thousands of homes, largely in Baltimore. Homeowners must pay the ground rent, typically a modest amount — sometimes less than $25 a year.
A Baltimore Sun investigation that showed some homeowners were being evicted over small unpaid ground rent bills prompted overhauls in 2007.
But the Maryland Court of Appeals ruled in October that a law extinguishing ground rents if their owners didn't register the properties with the state by 2010 was an unconstitutional taking of property, a move that left the registry intact but with no penalties attached. People with small handfuls of ground rents had protested that they didn't know they had to register until it was too late.
House Bill 177, filed Wednesday and sponsored by Del. Maggie McIntosh of Baltimore and 13 other delegates, specifies that ground lease owners must register in order to collect rent, sue for past-due amounts or file a lien against the home. It removes language setting a deadline to sign up as well as the extinguishment penalty that the court struck down.
The registry gives homeowners a point of contact for the owner of their ground rent. Thousands of the leases are thought to be essentially defunct, with no living owner.