Maryland Department of Housing and Community Development: Programs and Administration

The Maryland Department of Housing and Community Development (DHCD) administers the state's primary housing finance, community revitalization, and neighborhood investment programs. Operating under the authority of the Maryland Code, Housing and Community Development Article, the department functions as both a direct lender and a grant-making agency, channeling federal allocations and state bond proceeds into affordable housing production, homeownership assistance, and community development finance. Understanding DHCD's structure is essential for developers, local governments, nonprofit organizations, and households seeking access to state-administered housing resources.

Definition and scope

DHCD is a principal department of the Maryland executive branch, established under Maryland Code, Housing and Community Development Article. Its statutory mandate covers four broad operational domains: affordable rental housing financing, homeownership programs, community development lending, and neighborhood revitalization grants.

The department administers federal resources allocated to Maryland through the U.S. Department of Housing and Urban Development (HUD) and the U.S. Treasury, including Low-Income Housing Tax Credit (LIHTC) allocations, HOME Investment Partnerships Program funds, Community Development Block Grant (CDBG) funds, and the National Housing Trust Fund. These federal streams are layered with Maryland-issued mortgage revenue bonds and general obligation bond proceeds appropriated through the Maryland state budget process.

DHCD's geographic scope covers all 23 counties and Baltimore City. However, CDBG formula entitlement funds flow directly from HUD to jurisdictions meeting the population threshold — Montgomery County, Prince George's County, Baltimore County, Anne Arundel County, and Baltimore City each receive direct HUD entitlement allocations independent of DHCD administration. DHCD administers the CDBG Non-Entitlement program for the remaining counties.

Scope limitations: DHCD does not regulate private landlord-tenant relationships, enforce building codes, license real estate professionals, or administer public housing authorities. Public housing authority operations fall under locally governed entities and HUD's direct oversight. Landlord-tenant law is governed by the Maryland Code, Real Property Article, and enforced through the circuit and district courts.

How it works

DHCD operates through three primary divisions:

  1. Division of Credit Assurance — Administers the Maryland Mortgage Program (MMP), the state's flagship first-mortgage homeownership product. MMP offers below-market fixed interest rates financed through tax-exempt mortgage revenue bonds issued by DHCD. Borrowers must meet income and purchase price limits that vary by county. The division also administers the Maryland HomeCredit program, a Mortgage Credit Certificate (MCC) that provides a federal income tax credit of up to 25% of annual mortgage interest paid (DHCD Maryland Mortgage Program).

  2. Division of Neighborhood Revitalization — Manages the Community Development Block Grant Non-Entitlement program, the Community Legacy program, the Strategic Demolition Fund, and the Seed Community Development Anchor Institution Fund. These programs direct capital to local governments and nonprofit organizations for physical revitalization projects in designated priority funding areas.

  3. Division of Development Finance — Allocates Low-Income Housing Tax Credits and administers the Rental Housing Works program and the Rental Housing Production Program. Tax credit allocations are governed by the Qualified Allocation Plan (QAP), which DHCD publishes annually and which sets scoring criteria, set-asides, and geographic preferences for LIHTC applications.

Applications for DHCD financing programs are submitted through the department's online portal. Rental housing finance applications follow a competitive cycle governed by the QAP. Homeownership program access runs through a network of approximately 80 participating lenders statewide.

Common scenarios

Affordable rental housing development: A nonprofit developer seeking to build 60 units of affordable housing in Frederick County would apply to DHCD's Division of Development Finance for a LIHTC reservation. The application is scored under QAP criteria including market need, financial feasibility, readiness to proceed, and location in a Priority Funding Area as defined under the Smart Growth Areas Act (Maryland Code, State Finance and Procurement Article, §5-7B-02).

First-time homebuyer assistance: A household in Harford County with income below the applicable limit accesses the Maryland Mortgage Program through a participating lender. The loan is originated by the private lender, purchased by DHCD, and funded through bond proceeds. Eligible borrowers may combine MMP with the Maryland SmartBuy program if they carry qualifying student debt.

Community revitalization grant: A municipality in Washington County applies for Community Legacy funding to rehabilitate a vacant commercial anchor property in a designated Sustainable Community. Grant awards under this program require a local match and are administered through a reimbursement draw process.

Rural county CDBG allocation: A small county outside the HUD entitlement threshold applies to DHCD's Non-Entitlement CDBG program for infrastructure improvements in a low-to-moderate income service area. DHCD reviews the application against HUD national objectives and federal regulatory requirements at 24 CFR Part 570.

Decision boundaries

The distinction between DHCD-administered programs and locally administered programs is the primary decision boundary for applicants. Entitlement jurisdictions — those receiving direct HUD allocations — operate their own CDBG, HOME, and related programs through their planning or housing departments. For a comprehensive overview of how DHCD fits within the broader Maryland state agency structure, see the Maryland Government Authority index, which maps executive departments to their functional domains.

A secondary boundary separates DHCD from the Maryland Community Development Administration (CDA), which is legally the financing arm within DHCD rather than a separate department. CDA issues bonds and holds mortgage portfolios; DHCD's programmatic divisions administer eligibility and underwriting. Applicants interact with DHCD program staff, not CDA directly.

DHCD programs also do not apply to federally recognized tribal lands, federal enclaves, or military installations within Maryland. Properties subject to historic preservation easements held by the Maryland Historical Trust — a separate agency within the Department of Planning — may face additional review requirements that fall outside DHCD's authority.

Income and purchase price limits for homeownership programs are reset periodically based on HUD Area Median Income (AMI) determinations, which means program eligibility thresholds are not fixed year-to-year. Developers and lenders must consult the current program term sheets published by DHCD rather than relying on prior-cycle figures.

References

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