Amazon due for tax break

The Baltimore Development Corp. plans to ask the City Council to approve a resolution so the state can create a special tax zone on the site of a planned Amazon fulfillment center in Southeast Baltimore.

The area where the Internet retailer plans to operate a 1 million-square-foot building is already part of an existing Enterprise Zone that gives tax credits for real property and income tax credits for hiring economically disadvantaged employees. The resolution, which is expected to be introduced to the council Monday, allows Maryland to give credits for personal property and boost the credits for hiring disadvantaged workers by enhancing the designation to make it an Enterprise Zone Focus Area.

“While the enterprise zone provides incentives, many industrial properties in East Baltimore remain underdeveloped and underutilized,” Mayor Stephanie Rawlings-Blake said in an emailed statement Tuesday evening. “Therefore, we hope that the focus areas will offer businesses tax credits, in an effort to increase interest and investment in these properties.

“This effort is critical to creating job opportunities for city residents, and reviving properties,” Mayor Rawlings-Blake said.

Councilman Carl Stokes, the chairman of the Taxation, Finance and Economic Development Committee, welcomed the designation also.

“I’m hoping that Amazon comes in and it generates some ancillary businesses around it, and so in this case it’s not the worst thing in the world,” Stokes said.

If the area is designated as an Enterprise Zone Focus Area, it would be the fourth such area in the city. The other three are located along the Jones Falls in and around Hampden, in the Westport community around I-295, and in the section of East Baltimore that includes East Baltimore Development Inc.

As part of the Enterprise Zone, Amazon would receive an 80 percent tax credit on real property improvements the first five years, which then would draw down by 10 percent annually until the credit was reduced to 30 percent in the 10th and final year.

The designation also provides a one-time $1,000 income tax credit per worker and a $6,000 tax credit over three years for each economically disadvantaged employee.

The additional focus area tax credits would provide an 80 percent tax credit on real property improvements for the next 10 years, create an 80 percent tax credit for personal property, provide a one-time $1,500 income tax credit for each worker and a $9,000 income tax credit over three years for economically disadvantaged workers.

A resolution passed by the City Council and signed by the mayor is required before the state can create a Focus Area.

Councilman Bob Curran, who fought in the late 1990s to give the council more control over designating Enterprise Zones, said that he didn’t see any issues with the city seeking to turn the area into a Focus Area.

“We need to use all the tools we can to spur economic growth, spur jobs and put cranes in the sky,” Curran said.

Neither the BDC nor Amazon returned calls for comment.