The Tax Break That Built Leonard's Grant Just Ran Out

A buyer walked me through the numbers on two houses last month. One was a five-bedroom colonial in Leonard's Grant, resale, built sometime in the community's original run, listed in the high $600s. The other was new construction a few minutes away, similar square footage, similar finishes, priced noticeably higher once she added up the closing costs her lender had flagged. She wanted to know why two houses that looked so similar on paper didn't behave the same way at the settlement table.

The honest answer has nothing to do with granite countertops or lot size. It has to do with a fight that played out at the Chesapeake Building in Leonardtown between February and March of this year, one that quietly ended a cost advantage Leonard's Grant and its annexed neighbors had held for years.

How Leonard's Grant Got Its Shape

Leonard's Grant did not spring up on raw county land the way a lot of Southern Maryland subdivisions did. It exists because a landowner petitioned to annex the property into the Town of Leonardtown, which rezoned it under the town's Planned Urban Development designation. That zoning category is what allowed the higher-density, amenity-bundled layout you see when you drive through today: the village green, the pool and clubhouse that opened in 2011, the tennis and basketball courts, the sidewalks that let a kid bike from Leonard's Grant Parkway to the community's gazebo without crossing a state highway. Clark's Rest and Meadows at Town Run followed the same path.

Annexation is also why the state eventually put a traffic signal in at the neighborhood's entrance on Hollywood Road. That kind of infrastructure response usually shows up years after a community fills in, once the state notices the traffic Leonard's Grant itself generated.

None of that history shows up on a listing sheet. But it explains why the neighborhood's homeowners association dues sit around $75 a month, low for a community with this much shared amenity space. The heavy lifting on infrastructure, water, sewer, roads inside the development, was never the HOA's job. It was the town's, funded through a separate mechanism that has almost nothing to do with monthly dues.

The Fee Nobody Puts On The Listing Sheet

New construction inside Leonardtown's limits, including the annexed neighborhoods, has long carried its own charge: a local impact fee for water and sewer infrastructure that currently runs about $24,000 per dwelling unit. This is the fee the town uses to make sure new rooftops don't strain a system existing residents already paid to build. It is separate from property taxes, separate from HOA dues, and it applies at the point of new construction, not resale.

For years, that $24,000 fee was the only development-related charge a new home inside Leonardtown paid that a new home elsewhere in St. Mary's County didn't also pay in some form. Everywhere else in the county, new construction was also subject to the county's building excise tax. Inside Leonardtown, it wasn't, and not because anyone had decided the town should get a pass. The original 2021 legislation authorizing the tax, and the 2023 ordinance that implemented it, simply weren't written to reach inside municipal boundaries. Leonardtown built through the gap for two straight years.

The Gap That Just Closed

That gap became the subject of an increasingly public argument at the county level starting in February 2026. Commissioner Mike Hewitt raised the issue first, arguing the county stood to lose real revenue as Leonardtown annexations kept adding rooftops that never contributed to the county-wide excise tax, revenue that funds schools, roads, and public safety facilities tied to new growth. Commissioner Scott Ostrow put it in terms he clearly meant to sting a little, telling the board he couldn't defend charging the fee to a family building in Lexington Park or California while letting people building houses in the $600,000 to $700,000 range in Leonardtown skip it.

Leonardtown's mayor, Dan Burris, pushed back publicly. He argued the comparison ignored what town residents already pay on top of county taxes.

Leonardtown residents should not be required to pay twice for infrastructure services that the Town already provides.

At a public hearing on March 10, 2026, a Southern Maryland realtor named Chris Hill testified that Leonardtown buyers were already absorbing roughly $24,000 in local impact fees and that stacking the full county excise tax on top would mean paying twice for the same category of infrastructure. Seven residents spoke against the change that night. It didn't matter. On March 24, 2026, the commissioners voted 3-2, Guy, Hewitt, and Ostrow in favor, Alderson and Colvin opposed, to amend the ordinance and extend the county's building excise tax inside Leonardtown town limits going forward. For a standard single-family detached home, that tax is set at $6,697 in fiscal 2026.

Here's what that stack looks like now for anyone building new inside the town's annexed neighborhoods:

What This Means If You're Buying Now

If you're looking at a resale in Leonard's Grant, this new tax doesn't touch your closing costs directly. The homes there were built years before this fight started, and the excise tax attaches to new construction, not existing housing stock changing hands. Your HOA dues stay what they've always been, a comparatively light $75 a month for a pool, a clubhouse, tennis and basketball courts, and a walkable village green.

But the story still matters to you for two reasons. First, it explains part of why a brand-new build a few streets over, in Tudor Hall Farms or another annexed pocket of town, is going to price in a way that a Leonard's Grant resale of similar size won't. That gap used to be smaller. As of this year, it got a little wider, because new construction inside town limits now absorbs a cost that resale buyers in Leonard's Grant never will.

Second, it tells you something about how this part of the county thinks about growth. The same annexation and Planned Urban Development mechanism that gave Leonard's Grant its village green and its low dues is the same mechanism at work in whatever gets built next in town. Knowing that the excise tax question got resolved earlier this year, and how, is the kind of context that helps you read a new listing correctly instead of assuming every $650,000 house in the zip code was built under identical cost pressure.

A Few Questions Before You Write An Offer

Does the new county excise tax apply to a resale purchase in Leonard's Grant? No. The tax attaches to new building construction and is collected at the certificate of occupancy stage. A resale changing hands doesn't trigger it.

Will my HOA dues change because of this? Not directly. The excise tax and the town's water and sewer impact fee are municipal and county charges, separate from what the Leonard's Grant HOA collects and spends on its own amenities.

Does this affect future development near Leonard's Grant? It should. Any new construction inside Leonardtown's limits, including in annexed neighborhoods still building out, now carries the county excise tax on top of the town's existing impact fee, a combination that didn't exist together before March 2026.

If you're weighing a resale in Leonard's Grant against something newer nearby, or you're relocating from out of state or off base at Patuxent River and need someone to walk you through what these numbers actually mean at your specific closing, Diana Washabaugh can pull the comparison together and get you a clear read on the property you're looking at. Start with a free instant home valuation to see where your search should begin.