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City joins county to seek renewal, expansion of enterprise zones

Additional 299 acres inside the city and 2,200 acres in the areas of Hopewell Valley and Hump Road being sought.

April 20, 2012|By C.J. LOVELACE | cj.lovelace@herald-mail.com
  • Hagerstown/Washington Co. Enterprise Zone
Hagerstown/Washington Co. Enterprise Zone

The Hagerstown City Council has approved a resolution to support a joint application with Washington County for the renewal and expansion of enterprise zones in and around Hagerstown.

The enterprise zones — which offer businesses property tax credits for new construction or rehabilitation investments — along with income-tax credits for job creation, will be renewed for 10 years, from Dec. 14, 2012, to Dec. 14, 2022.

Jill Estavillo, city economic development manager, first presented the proposal at the beginning of March, and city and county public hearings were held March 20.

“We think that the enterprise zone incentive would help to foster new investment,” Estavillo has said.

County officials have submitted the joint application to the Maryland Department of Business and Economic Development, Estavillo said this week.

Twenty-one of 25 properties currently receiving benefits are within city limits, but city and county officials want to expand opportunities for businesses.

First established locally in 1992 and renewed in 2002, about 1,402 acres are in the enterprise zone, and the proposed expansion would increase that area by almost 2,499 acres to 3,901 acres.

An additional 299 acres inside the city — including the entire Downtown-Mixed Use zoning areas, rail corridors, areas in the East End of the city negatively affected by the relocation of the hospital and additional land on the West End that was annexed in recent years — will be added.

The county proposes an expansion of approximately 2,200 acres in the areas of Hopewell Valley and Hump Road.

To be eligible for benefits, a business must be within the zone, and meet minimum requirements for construction or rehabilitation work or job creation. There are restrictions to certain types of businesses.

Reimbursed by the state, a 10-year credit against local property taxes is available for the value of improvements to offset increased value, starting at 80 percent in years one through five and tapering off to 30 percent by the 10th year.

A one- or three-year tax credit for wages paid to eligible new employees is also available. The one-time credit is $1,000 per new worker, while the three-year option pays $6,000 at the rate of $2,000 annually.

A “new job” is defined as a full-time, permanent position of 35 hours or more per week that previously did not exist in Washington County before the business moved into or expanded in the enterprise zone.

The worker must also earn 150 percent of the federal minimum wage and be employed for at least six months before credit can be claimed.

For eligibility within the City Center, businesses must undertake a construction or rehabilitation investment of at least $5,000 or create one new job.

Outside the City Center, a $50,000 construction or rehabilitation investment or five new jobs is required.

Eligible businesses include manufacturing, warehousing, research and development, corporate or regional offices, service industries and retail, if located within City Center.

Machinery and equipment purchases are not eligible for reimbursement.

There are 28 enterprise zones across Maryland, including 693 acres at Hagerstown Regional Airport and 1,850 acres in the town of Hancock.

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