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Incentives
We’re business friendly! Allegany County offers many incentive programs that can make locating here a savvy business decision. Real property tax credits, job creation tax credits, low interest loans, grants, start-up cost abatements – all can be found in Allegany County. Our office is ready to help you find all the cost advantages possible.
The State of Maryland offers assistance in containing the cost of doing business on a number of levels. In Allegany County, the Department of Economic Development and Communication works closely with both existing companies and companies looking to locate in our community in finding the program – or programs – best suited to helping your company reach its goals.
HubZone & Maryland ENTERPRISE ZOne
Allegany County is home to two federal HUBZones, one located in South Cumberland and one in Frostburg. The HUBZones Empowerment Contracting Program provides Federal contracting preferences to small businesses that obtain HUBZone Certification.
There are three Maryland Enterprise Zones designated in Allegany County. Businesses locating in a Maryland Enterprise Zone may be eligible for income tax credits and real property tax credits in return for job creation and investments made in the zone. Allegany County's Enterprise Zones are located in Cumberland, Frostburg and Rt. 220 South, giving businesses several tax saving options.
For further information on incentives, call the Maryland Department of Commerce click here.
Explore Additional Featured Incentives
Allegany County is an active participant in the state of Maryland's Enterprise Zone program. Within Allegany County, companies hoping to tap the tax credits available through the program have no problem finding a location well suited to their business needs. Allegany County has three zones,the Gateway Zone, which was designated June 15, 2012, and expires on June 14, 2022, includes most of the City of Cumberland, as well as the North Branch Industrial Park, riverside Industrial Park, Commerce Center and the Upper Potomac Industrial Park. The Frostburg Zone includes the Frostburg Business Park, most of Main Street and the Allegany Business Center at Frostburg State University. The third zone is the Route 220 South Zone which encompasses the Barton Business Park. The designation date for the Route 220 Zone is December 23, 2009. The expiration date is December 22, 2019.
Whether your company wishes to locate in one of the county's business parks or within the county's primary business district, it is relatively easy to qualify. Tax credits are provided for job creation and may include real property improvements.
Under the program, income tax credits are provided for a period of one to three years for wages paid to new employees. In general, a $1,000, one time credit is given for each new worker. However, for economically disadvantaged employees, the credit increases to a total of $6,000 per employee provided over a three year period.
The real property tax credits provide a 10 year credit against local real property taxes on a portion of real property improvements. The credit is provided at 80% for the first five years, with annual decreases of 10% to a low of 30% in the tenth and final year of the credit program.
EZ Application
While the Enterprise Zone program can be very beneficial in certain situations, local standards and your specific business may limit your use of the program. A discussion about what the program means to your business can be held with Matthew W. Diaz, Allegany County Department of Economic & Community Development at 301 777-5967.
This state program does just what it says – it provides businesses locating in Allegany County with tax credits for creating new jobs. It applies to businesses relocating to Maryland, as well as businesses located here that expand.
Generally speaking, the credit usually is applied at two-and-one-half percent of the aggregate annual wages paid in all newly created, full time jobs. This is subject to $1,000 multiplied by the number of jobs created, and may not exceed $1 million per credit year.
However, in an Enterprise Zone, or a Department of Housing and Urban Development designated neighborhood, that credit increases to five percent of the annual wages for all new, full time positions. This credit is limited to $1,500 multiplied by the number of jobs created, and also may not exceed $1 million per credit year.
In addition, unused credits may be carried over for up to five years following the year in which the credit could first be used to reduce the tax liability. In order to qualify for the program, the business must create a minimum of 60 new, full time jobs over a 24 month period. For those businesses choosing to locate in an Enterprise Zone or an incorporated municipality, only 25 new, full time positions must be created.
Businesses that invest in an economic development project in a “qualified distressed county” may qualify for project tax credits of up to $5 million and start-up tax credits of up to $500,000.
Project Tax Credit
Up to $5 million based on qualifying costs and expenses incurred with the acquisition, construction, rehabilitation, installation, and equipping of an eligible project. Eligible costs include land acquisition, performance and contract bonds, insurance, architectural and engineering services, environmental mitigation, and utility installation. Eligible costs must be at least $500,000. Project costs exceeding $5 million are not eligible.
Start-up Tax Credit
Expense of moving a business from outside Maryland and for the costs of furnishing and equipping a new location. Eligible costs include the cost of fixed telecommunications, office equipment, and office furnishings. Credit cannot exceed the lesser of $500,000 of eligible costs or $10,000 times the number of new, positions created.
Qualifying
Business must meet the following requirements:
Location – “Priority Funding Area” in a “qualified distressed county.” Baltimore City, Allegany, Caroline, Dorchester, Garrett, Somerset and Worcester counties. Subject to change.
Declaration of Intent – The business must notify DBED of its intent to seek certification prior to creating jobs or incurring expenses.
Certification – The business must apply to and be certified by DBED as an eligible business entity.
Job Creation Minimums – The business must create at least 25 new, full-time positions at the project within 24 months, and the positions must be filled for 12 months.
The project must be engaged in an eligible activity.
Claiming Credits
A qualified business entity may claim both the project and start-up tax credits. The business has up to 14 years after the tax-year in which the project is placed in service to take the credits.
In years one through five, the business may apply the start-up credits against its Maryland income tax liability. In years six through 15, it may apply the start-up credits against its Maryland income tax liability and in addition, claim a refund subject to the payroll withholding of the qualified employees.
In years one through five, the business may apply the project income tax credit against the income tax arising from the project. In years six through 15, it may apply the project credits against the income arising from the project and in addition, apply the project credits against its non-project income and claim a refund, both of which are limited to the payroll withholding of the qualified employees. For further information on the One Maryland Tax Incentive click here
A state program available through the Maryland Department of Commerce that aims to reclaim former industrial sites, the Brownfields Tax Incentive Program provides businesses tax credits for simply locating in a targeted brownfield area.
At Allegany County's North Branch Industrial Complex, businesses qualify for real property tax credits at 50% to 70% of the increased value of the property for up to 10 years.
The only caveat: the credit may not exceed 100% of the tax on the increased value of the property.