DBED expands Baltimore’s Enterprise Zone 

Posted: 5:04 pm Wed, December 23, 2009
By Nicholas Sohr
Daily Record Business Writer

Property renovation and job creation tax credits were extended to several areas of Baltimore on Wednesday in hopes of spurring a range of development projects, from grocery stores to a downtown hotel.

The credits, announced by the Department of Business and Economic Development, come with an expansion of the city’s Enterprise Zone, which covers about 22,000 acres, including much of downtown, East Baltimore and stretches along major transportation arteries.

“The Enterprise Zone program is an important tool for fostering economic development in our established urban and suburban areas,” said Gov. Martin O’Malley in a written statement. “Expanding these zones will help sustain existing businesses and attract much-needed new businesses and help us achieve our most important goal of creating and retaining jobs.”

Businesses in the state’s 28 zones saw $26.3 million in property tax credits last year, according to DBED.

Baltimore’s zone will grow by 329 acres, encompassing Liberty Heights, the Upton neighborhood around Pennsylvania Avenue, the area between South Clifton Park and North Avenue, and a 45-acre swath of downtown bounded by Lombard, Baltimore, Paca and President streets.

According to DBED, the expanded zone will help bring grocery stores to Liberty Heights and Upton and reduce commercial vacancies on Pennsylvania Avenue. City officials also hope the tax benefits will renew efforts to renovate the Morris Mechanic Theater and build a Four Points by Sheraton hotel on South Calvert Street.

“These are projects that have been in the works for many years,” said Baltimore Deputy Mayor Andy Frank. “The grocery store project on Liberty Road has probably been in the planning stages for five years.”

Many of the projects have been hit hard by the economic recession, Frank said.

“In some small measure, the Enterprise Zone changes the economics,” he said. “It’s not a huge benefit, but it could be enough to make the difference for some projects. And it does it in a way that doesn’t break the bank for the city.”

Businesses expanding in or moving into zones are eligible for five years of credits worth 80 percent of their property tax increases based on capital improvements made to their properties. The credits then decrease by 10 points per year for the next five years. In addition, businesses are eligible for $1,000 tax credits for each full-time employee hired into a new position.

DBED also announced Wednesday the renewal of elevated benefits in the Carroll-Camden industrial area and the extension of those benefits to an area near Howard Street bounded by 28th Street, the Jones Falls Expressway, Charles Street and North Avenue. In those areas, the property tax credits stay at 80 percent for 10 years, and job creation tax credits rise to $1,500 per new position.

Enterprise Zones in Allegany and Prince George’s counties were also expanded by the department.