Child care operators in Annapolis just scored a new financial lifeline. On Monday, the Annapolis City Council unanimously approved a property tax credit that will give eligible child care providers up to $4,000 a year, a move sponsors say is aimed at helping centers hang on to staff, fix aging buildings, or simply keep their doors open as local demand keeps outpacing available slots.
The council signed off on the $4,000 credit and set it to kick in for fiscal year 2028, according to city records and local reporting. A fiscal impact report found 48 potentially eligible child care businesses in the city out of 85 total programs, with 37 categorized as religious or nonprofit and therefore not eligible. The fiscal note projected a maximum annual city tax hit of $192,000 if every qualifying center applied, and staff warned that an earlier $10,000 version of the credit could have cost the city more than $800,000 a year, as reported by The Banner.
How the credit will work
According to meeting materials from the City of Annapolis, the ordinance covers property used exclusively for state-licensed or registered child care centers, family child care homes, and large family child care homes. Property owners who host licensed programs can apply for the credit as well. The measure started out with a $10,000 cap before an amendment cut the maximum, and even then, not every proposed site qualifies. Diego Medina, who said he planned to open a center at Calvary United Methodist Church, told The Banner that a center operating inside a religious facility would not be eligible.
Why the cap dropped
The original $10,000 cap quickly raised red flags once city finance staff laid out the potential price tag, so sponsors scaled back the proposal to win support. Alderman Brooks Schandelmeier, who introduced the amendment cutting the cap to $4,000, wrote that his review of local property tax bills showed most would-be beneficiaries pay roughly $2,000 to $4,000 in city property taxes, which made a $4,000 ceiling both more realistic and less risky for the budget. He explained that reasoning on his campaign website, arguing that a smaller cap would still deliver meaningful relief while dialing back the projected hit to city finances (Brooks Schandelmeier campaign blog).
Costs, coverage and next steps
The ordinance packet includes a fiscal impact report and updated staff analysis that council members leaned on during debate. Those documents are listed among the O-1-26 attachments on the city agenda and will shape how the credit is rolled out. City staff and the finance office still need to lock in the application process and eligibility checks before the credit becomes available in FY2028, and upcoming budget and committee meetings are expected to surface more details. For the full packet and attachments, residents can dig through the council materials on the City of Annapolis meeting calendar and agenda pages.
What providers say
Child care providers who spoke up welcomed the tax break but stressed that it is a targeted, relatively modest tool rather than a sweeping fix for the city’s shortage of child care slots. City leaders have framed the move as one piece of a broader affordability strategy. The mayor’s newsletter and council materials highlight the credit as a way to get immediate, focused help to licensed operators while longer-term solutions to cost and capacity are worked out (Mayor Jared Littmann newsletter).
