$1,000 a Day in Fines: A Seaside Town Countersues a Church Over the Shelter in Its Hall

• St Paul’s by-the-Sea, an Episcopal church in Ocean City, Maryland, moved homeless people from an outdoor tent into its church hall in late March 2026.
• The church sits in an R-3 residential district, directly across from City Hall.
• The town began fines of $1,000 a day on June 8, 2026, later suspended during litigation.
• The town’s countersuit says the shelter is not a permitted use and seeks a permanent injunction.

A church shelter in a Maryland resort town is now the subject of lawsuits on both sides. The Ocean City Today and Dispatch reported that the Town of Ocean City has filed a countersuit against St Paul’s by-the-Sea, claiming its homeless shelter violates the zoning code.

The Episcopal church stands at the corner of Third Street and Baltimore Avenue, in an R-3 residential district directly across from City Hall. In late March 2026 it moved homeless people from an outdoor tent shelter into its church hall, setting up a barracks-style indoor shelter with bunk beds and paid staff.

After a 30-day notice period, the town began issuing fines of $1,000 a day on June 8, 2026. It has voluntarily suspended the citations while the case is in court. The church’s lawsuit alleges violations of its First and Fourteenth Amendment rights and of the Religious Land Use and Institutionalized Persons Act. Its statement said: “Housing homeless persons on Church premises exemplifies and is commanded by the religious doctrine of the Episcopal Church of America.” The town’s counterclaim says the shelter “has not been a permitted use under the Ocean City Code at any relevant time” and asks the court to order it closed permanently.

City solicitor Heather Stansbury is handling the case for the town.

The dispute shows how fast the costs can mount when a church building is used in a way its zoning does not allow. At $1,000 a day, fines can add up quickly. Jamaican churches in residential areas that want to host people overnight, run feeding programmes or house families after a disaster should know their building’s approved use and talk to the local authority first. Doing so costs little; a legal fight costs a great deal. Neighbours and councils, for their part, are more likely to accept a plan they were consulted on.

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