MD Incentives | Finance, Loans, IRB, Workforce Development

A comprehensive list of Maryland financial aid, loans, grants, abatements, workforce development, exemptions, funds & capital investment opportunities.


https://businessfacilities.com/2015/01/md-incentives-and-workforce-development-guide/
A comprehensive list of Maryland financial aid, loans, grants, abatements, workforce development, exemptions, funds & capital investment opportunities.
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Maryland Incentives and Workforce Development Guide

MD Incentives | Finance, Loans, IRB, Workforce Development

For a list of Maryland economic development agencies that can help with the site selection process, visit our Online Site Seekers’ Guide.

 

FINANCING & GRANTS

ADVANCE Maryland: In partnership with the National Center for Economic Gardening, this is a program for second-stage entrepreneurs that use a “grow from within” strategy targeting existing growth companies and offering them critical strategic information customized to their needs.

Community Development Block Grant Program: Provides funding to commercial and industrial economic development projects. Program funds are dispersed to a local jurisdiction in the form of a conditional grant and are then used for public improvements or loaned to a business.

Economic Development Opportunities Fund (Sunny Day): Supports extraordinary economic development opportunities that create and retain employment as well as create significant private capital investment.

Maryland E-Nnovation Initiative Fund (MEIF): Offers a state match to private funds raised in support of endowed chairs at Maryland’s nonprofit institutions of higher education. Under the fund, $8.5 million will be appropriated by the Governor annually from fiscal 2016 through 2021.

Maryland Economic Adjustment Fund (MEAF)Assists business entities in the state with modernization of manufacturing operations, development of commercial applications for technology, and exploring and entering new markets.

Maryland Economic Development Assistance Authority Fund: Also known as Advantage Maryland, this program provides grants, loans, and investments to support economic development initiatives across the state. To qualify for assistance, applicants are restricted to businesses located within a priority funding area and an eligible industry sector. With a few exceptions, assistance cannot exceed 70% of the total project costs.

Maryland Industrial Development Financing Authority (MIDFA): MIDFA encourages private sector investments through the use of insurance, and the issuance of tax-exempt and taxable revenue bonds. Insurance reduces the lender’s credit risk. All MIDFA projects must be in a Priority Funding Area.

Maryland Innovation Initiative (MII): Created as a partnership between the State of Maryland and five Maryland academic research institutions, the program is designed to promote commercialization of research conducted in the partnership universities and leverage each institution’s strengths. Qualifying Universities, faculty from Qualifying Universities, and other entrepreneurs interested in creating a University Start-up are eligible for funding.

Maryland Small Business Development Financing Authority (MSBDFA): Created to promote the viability and expansion of businesses owned by economically and socially disadvantaged entrepreneurs, MSBDFA clients include all small businesses unable to obtain adequate business financing on reasonable terms through normal financing channels. The program includes a guaranty fund, contract financing, a surety bond program, and an equity participation investment component. This State program is managed by Meridian Management Group.

Military Personnel and Veteran-Owned Small Business Loan Program: Provides no interest loans for businesses owned by military reservists, veterans, National Guard personnel, and for small businesses that employ or are owned by such persons.

Maryland Nonprofit Development Center Program and Fund – Nonprofit, Interest-Free, Micro Bridge Loan Account (NIMBL): Supports the operations of nonprofit entities. The program provides up to $25,000 in short-term financing support to qualifying nonprofits between the award date of a government contract and the actual receipt date of those awarded funds.

Partnership for Workforce Quality (PWQ): Provides matching training grants and support services targeted to improve the competitive position of small and mid-sized manufacturing and technology companies.

Small, Minority, and Women-Owned Business Account Video Lottery Terminal Fund (VLT): VLT provides for 1.5% of the proceeds from video lottery terminals (slots) to be distributed in targeted areas surrounding five Maryland casinos: Maryland Live in Anne Arundel County, Hollywood Casino Perryville in Cecil County, Rocky Gap in Allegany County, Ocean Downs in Worcester County, and Horseshoe Casino in Baltimore City. At least 50% of allocations will be deployed to small, minority and women-owned businesses located within targeted areas surrounding the six casinos. The other 50% will be available to small, minority and women-owned businesses located throughout Maryland.

State Small Business Credit Initiative (SSBCI): Passed as part of the Small Business Jobs Act of 2010, this initiative awarded Maryland with $23 million to strengthen existing financing programs that support lending to small businesses. The State is allocating the funds to programs that leverage private lending to help finance small businesses that are creditworthy, but are not getting the loans they need to expand and create jobs.

 

TAX INCENTIVES

Biotechnology Investment Incentive Tax Credit (BIITC): Provides a refundable income tax credit to a Qualified Investor, which is any individual or entity that invests at least $25,000 into a Qualified Maryland Biotechnology Company (QMBC). The credit is equal to 50% of an eligible investment. A single QMBC may not receive benefit of credits exceeding 15% of the total program appropriation for each fiscal year. The program supports investment in early-stage biotech companies to promote and grow the biotech industry in Maryland. If the QMBC is located in Allegany, Dorchester, Garrett, or Somerset counties, the BIITC increases the amount of the credit provided for an investment to 75% (not to exceed $500,000).

Brownfields Revitalization Incentive Program (BRIP): A site that qualifies for this incentive program may qualify for real property tax credits as well. The site must be located in a jurisdiction that participates in the BRIP, and owned by an inculpable person. For five years after cleanup, a site may qualify for a real property tax credit between 50% and 70% of the increased value of the site. (In an Enterprise Zone, the tax credit may last for up to 10 years). This credit, combined with other real property tax credits, may not exceed 100% of the tax on the increased value of the site.

Buy Maryland Cybersecurity (BMC): Maryland also now provides the opportunity for qualified buyers to apply for a tax credit for the purchase of Maryland cybersecurity technologies and services from Qualified Maryland cybersecurity sellers. A qualified buyer that purchases from a qualified seller may claim a credit against the state income tax in an amount equal to 50% of the cost incurred during the taxable year of the purchase. This may not exceed $50,000 for each qualified buyer. Aggregate claims in any taxable year for purchases from a single seller may not exceed $200,000.

Cybersecurity Investor Incentive Tax Credit (CIITC): Provides a refundable income tax credit to a Qualified Investor, which is any individual or entity that invests at least $25,000 into a Qualified Maryland Cybersecurity Company (QMCC). The credit is equal to 33% of an eligible investment. A single QMBC may not receive benefit of credits exceeding 15% of the total program appropriation for each fiscal year. An investor may receive 50% of the investment up to $500,000 if the QMCC is located in Allegany, Dorchester, Garrett, or Somerset Counties.

Enterprise Zone Tax Credit (EZ): The EZ program provides real property and state income tax credits for businesses located in a Maryland enterprise zone in return for job creation and investments. Businesses located in Focus Areas may be also qualified for personal property tax credits on new investment in personal property and enhanced income tax credit for creating new jobs.

Employer Security Clearance Costs (ESCC) Tax Credit: The ESCC Tax Credit provides income tax credits for expenses related to federal security clearance costs, construction of Sensitive Compartmented Information Facilities (SCIFs) and first-year leasing costs for small businesses doing security-based contract work.

Hire Our Veterans Tax Credit: Small businesses with 50 or fewer employees may qualify for income tax credits in return for hiring veterans who have been honorably discharged or released under honorable circumstances. The income tax credit may not exceed 30% of up to the first $6,000 wages paid (i.e. a maximum of $1,800 per qualified veteran employee), and a small business may not claim the credit for more than 5 qualified veteran employees for each taxable year.

Job Creation Tax Credit (JCTC): Businesses that create a minimum number of new full-time positions may be entitled to state income tax credits of up to $3,000 per year or up to $5,000 per job in a revitalization area. Businesses engaged in an eligible activity must create at least 60 new full-time jobs in a 24-month period; this is reduced to 25 new jobs in a JCTC Priority Funding Area, and reduced to 10 new full-time jobs if they are located in a county with average employment of less than 75,000, or a median household income that is less than two-thirds of the statewide median. Commerce cannot certify more than $4 million in tax credits in a calendar year.

Maryland Opportunity Zones Enhanced Tax Credits: Businesses and investors participating in the Federal Opportunity Zone program may qualify for enhanced tax credits under one of the following Maryland tax credit programs: More Jobs for Marylanders, Job Creation, One Maryland, Enterprise Zone, Biotechnology Investor Incentive and Cybersecurity Investor Incentive Tax Credits.  The business can apply for a Level 1 or Level 2 Enhancement credit.  The enhanced value of the credit is dependent on the program.  Businesses must meet the federal definition of a Qualified Opportunity Zone Business with an investment from a Qualified Opportunity Zone Fund and meet the underlying requirements of the More Jobs for Marylanders, Job Creation, One Maryland or Enterprise Zone tax credits.  For the Biotechnology and Cybersecurity Investment Incentives, in addition to meeting the requirements of the program, the investor must meet the definition of a Qualified Opportunity Zone Fund and the business it is investing in must be located in the Opportunity Zone.

Level 1 Enhancements require the business or investor to provide Commerce with specific information on the investment in the Opportunity Zone.  Level 2 Enhancements require, in addition to the information required for Level 1, specific engagement of the business or investor with the residents in the Opportunity Zone (for example, a Community Benefits Agreement) and a resolution approving the business for the credit from the local government.

More Jobs for Marylanders Tax Credit: Incentivizes new and existing manufacturers to locate and expand in Maryland and non-manufacturers to locate and expand in Maryland Opportunity Zones. Businesses in Tier 1 Areas and Opportunity Zones must create at least 5 new jobs and businesses in Tier 2 Areas must create at least 10 new jobs. All businesses must provide ongoing job training and meet other requirements.  The following benefits are available for a 10 year period.

  • TIER 1 NEW MANUFACTURING BUSINESS: (a) a refundable credit against the State’s income tax of 5.75% of wages for each qualified position; (b) a credit against the State’s portion of the property tax; (c) a refund of sales and use tax; and (d) a waiver of fees charged by SDAT.
  • OPPORTUNITY ZONE NEW NON-MANUFACTURING BUSINESS: (a) a refundable credit against the State’s income tax of 5.75% of wages for each qualified position; (b) a credit against the State’s portion of the property tax that is the lesser of 100% of state property tax OR $250 per qualified position; (c) a refund of sales and use tax; and (d) a waiver of fees charged by SDAT.
  • TIER 1 OR TIER 2 EXISTING MANUFACTURING BUSINESS and OPPORTUNITY ZONE EXISTING NON-MANUFACTURING BUSINESS: A refundable credit against the State’s income tax of 5.75% of wages for each qualified position.

One Maryland Tax Credit: Businesses in an eligible industry sector that invest in an economic development project in a Tier 1 county may qualify for up to $5 million in income tax credits. The amount of income tax credit that a business will qualify for depends on the amount of eligible project costs it incurs and the number of new qualified jobs it creates in a 24-month period. Eligible project costs include qualifying costs incurred in connection with the acquisition, construction, rehabilitation, and installation of a project. The credit can be carried forward 10 years and is refundable starting in the fourth year following the credit year, subject to certain limitations.

Research and Development (R&D) Tax CreditFor Maryland businesses that incur Maryland qualified research and development expenses, the Basic R&D tax credit is the lesser of 3% of eligible R&D expenses or 3% of the Maryland Base Amount. The Growth R&D tax credit is 10% of eligible R&D expenses in excess of the Maryland Base Amount. The Basic credit is capped at $5.5 million annually, and the Growth credit is capped at $6.5 million. If the amount of credits all businesses apply for exceeds the cap, each business receives its pro rata share.

Businesses must submit an application to Commerce by November 15 for expenses incurred in the previous tax year and will be certified by February 15. The credit is refundable for “small businesses.” The business may file an amended tax return for the year it is certified or it may claim the credit on an income tax return filed for any of the following 7 tax years.

Regional Institution Strategic Enterprise (RISE) Zone Program: A RISE Zone is a geographic area that has nexus (a strong connection) with a qualified institution and is targeted for increased economic and community development. Qualified institutions include institutions of higher education, regional higher education centers or non-profits affiliated with a federal agency.

The purpose of the RISE Zone program is to access institutional assets that have a strong and demonstrated history of commitment to economic development and revitalization in the communities in which they are located. Qualified institutions and local governments develop a targeted strategy to use the institutional assets and financial incentives to attract businesses and create jobs within the zone.

Businesses locating in a RISE Zone or an existing business doing a significant expansion within the Zone, may qualify for real property tax credits and income tax credits related to capital investment and job creation.

A RISE Zone designation will be in effect for 5 years, with a possible additional 5-year renewal. Counties and municipalities are limited to a maximum of three RISE Zones.

Small Business Relief Tax Credit: A refundable tax credit available to small businesses that provide their employees with paid sick and safe leave. To qualify for the tax credit, a small business must employ 14 or fewer employees and provide its employees with paid sick and safe leave in accordance with the Maryland Healthy Working Families Act. An employee must make less than the 250% of the annual federal poverty guideline for a single-person household (currently $30,350/$14.59 per hour). The amount of the tax credit is up to $500 per employee and $7,000 per small business every year it qualifies for the credit.

Wineries and Vineyards Tax Credit (WVTC)A Maryland Winery/Vineyard may be qualified for an income tax credit equal to 25% of qualified capital expenses. Total credits granted may not exceed $500,000 in a year. If the total amount of credits applied for exceeds $500,000, the credit will be prorated among the certified applicants.

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