Maryland expands enterprise zones
The Maryland Commerce Department said Thursday it is expanding the tax breaks available to businesses that locate in certain parts of the state called enterprise zones, which aim to encourage targeted business investment.
The state said it approved Queen Anne’s County’s request to create a 1,300-acre enterprise zone on the U.S. 50/301 corridor, which aims to make business parks there more attractive. In Baltimore, the state approved the city’s bid to expand the credits available in a 140-acre area in West Baltimore through a “focus area” to spur investment around North and Pennsylvania avenues.
The state also renewed existing enterprise zones in Somerset and Worcester counties and expanded such zones in Harford and Wicomico counties.
Enterprise zones provide breaks on property taxes for 10 years, phasing down from 80 percent of the assessment in the first five years. Businesses also receive tax credits for hires made after locating in one of the designated areas.
The program started in 1982 and now covers more than 70,000 acres across the state. Critics have charged that its growth is costing state and local governments valuable revenue while diluting the program’s effectiveness. The state, which partially reimburses local jurisdictions for the credits, is facing a $400 million budget hole.
The Department of Commerce said businesses in enterprise zones have received about $32 million in property tax credits since the fiscal year started in July. Those firms made $2.8 billion in capital investments in the prior year, it said.
Companies and local jurisdictions like the program, said Commerce Department spokeswoman Karen Glenn Hood, adding that the department considers the costs worth it.
“Obviously we’re very mindful of the budget situation whenever we do any kind of incentives,” she said. “We feel like it’s benefit for our state, for our county partners. … We’ve gotten a lot out of it over the years.”