The City of Aberdeen is considering property tax credits for two new businesses — a grocery store and a restaurant — that are within the enterprise zone.
The council voted at its meeting Monday night to introduce two resolutions that would provide tax credits for Lidl U.S. Operations LLC and 102 N. Rogers Street to the Greater Aberdeen Havre de Grace Enterprise Zone for 10 years. The council will vote on the resolutions at the next council meeting, Nov. 26.
Lidl and 102 N. Rogers have applied for tax credits from Harford County as part of inclusion in the Enterprise Zone, according to Cindy Mumby, spokesperson for Harford County government. It must be approved by the Harford County Council, which does not meet again until after the members are sworn in for a new term Dec. 3.
“This is a Maryland state program that encourages capital investment in underserved or underprivileged areas. It’s precincts that are traditionally in lower income areas and most of Aberdeen is in an Enterprise Zone, which is good,” Aberdeen Mayor Patrick McGrady said. “It’s a good opportunity for capital to smooth into the taxes paid here in Aberdeen.”
A large portion of the city is already part of the zone, which was created in 1996, City Planning Director Phyllis Grover said. It includes Route 40, Route 22, Beards Hill Road and West Bel Air Avenue.
Businesses are eligible for real property tax credits and state income tax credits based on capital improvements and job creation, she said.
The Lidl grocery store, at 621 S. Philadelphia Blvd., would receive 80 percent credit on its property taxes in the first through fifth year — paying about $4,500 on an original tax bill of $22,757.
Grover said that is based on an assessment in its building permit application of a $3.5 million capital investment. That figure could change, she cautioned, saying the land was bought for $3 million, the building is costing $8.5 million and it is purchasing machinery and equipment valued at $1.5 million.
In each subsequent year through year 10, Lidl’s credit will decrease by 10 percentage points, so in Year 6, the credit will be 70 percent; Year 7, 60 percent; Year 8, 50 percent; Year 9, 40 percent; and Year 10, 30 percent.
The estimated taxes Lidl will have paid after 10 years, based on the $3.5 million assessment value, totals $79,650, Grover said. The tax credit expires after 10 years.
The German-based grocery store has not announced a grand opening date for the Aberdeen store, according to Chandler Ebeier, a spokesperson for Lidl US.
The other application for tax credits was from Arthur and Ann Helton, owners of 102 N. Rogers St., the former Moose Lodge, which is being renovated to become a new Prost restaurant, serving German food.
The estimated assessment value, according to its building permit, is $1 million, Grover said. She said no employees have been hired, but the parent restaurant in Port Deposit has 20 to 30 full- and part-time employees.
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In the first five years, the Heltons will pay $1,300 a year, Grover said. Over the 10 years of the credit, the Heltons will pay $22,757 in taxes before reverting to the full amount.