Commercial and Industrial Business Tax Credit

Mills Custom Wood Floors

jangardnerIn addition to cabinet appointments, Frederick County Executive Jan Gardner announced that she will propose legislation to the County Council for a Frederick County Commercial and Industrial Business Tax Credit to support and incentivize new and expanding businesses to invest in Frederick County and create jobs with a focus on
manufacturing, fabricating and assembly.

“This tax credit will help us to be more competitive with our surrounding jurisdictions in attracting new businesses and jobs, add another tool to our economic development tool box and allow us greater flexibility to negotiate an incentive package with new or expanding businesses. The end goal is to create more jobs in
Frederick County, support jobs that pay family supporting wages and to provide more local job opportunities so fewer of our residents need to commute out of the county to work,” said Executive Gardner.

Some of the criteria to qualify for the tax credit includes:

  • A substantial new investment of at least $5 million in the acquisition or expansion of a building, land or
    equipment resulting in developing and operating a facility within Frederick County.
  • Creation of at least 25 new jobs where the positions may not have been transferred from another location
    within the county – they must be new jobs to the county.
  • Qualifying facilities must be located in appropriately zoned areas, not in agriculture or resource conservation zones.
  • The facility must be in continual operation each tax year.

Tax credit agreements would be negotiated on a case-by-case basis and entered into between the county and the qualifying business. The legislation would provide for property tax credits up to 100 percent on the incremental property tax created by the investment for a period not longer than 10 years.

This tax credit program is modeled after a Howard County program which generally negotiated partial tax credits for three to five years. The county executive would negotiate the term and amount of each tax credit based on what was deemed to be in the county’s best interest.

This tax credit flexibility would help attract new businesses, support existing businesses that want to expand their operations and hire more employees and would provide long-term property tax and income tax benefits to the county, as well as ensure the community’s economic prosperity by supporting new jobs.

The council will consider the first reading or introduction of this bill at its meeting on July 21.

Executive Gardner has taken numerous steps over the past seven months since taking office that emphasize her support for economic development, including:

  • Elevating the Office of Economic Development (OED) and placing it directly under the county executive’s office.
  • Restoring the Small Business Revolving Loan Fund.
  • Initiating a Minority Business Outreach initiative.
  • Moving forward with the creation of a second business incubator in downtown Frederick with a focus on
    information technology businesses.
  • Supporting the Consortium for Research Excellence, Support and Training — the higher education center.
  • Adding an Agricultural Economic Development Specialist to OED.

For additional information, contact Director Helen Propheter, Office of Economic Development, at 301-
600-1058 or via e-mail at hpropheter@FrederickCountyMD.gov.

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