It has been an incredibly busy first half of 2017 for the Anne Arundel Economic Development Corp.
When I came on board as CEO in November of last year, we embarked on a staff-wide review of every program and service offered by the AAEDC to see if it met the needs of the business community. It was helpful to understand which services were the most beneficial to our companies and how to further incentivize businesses to locate in Anne Arundel County.
One of the sectors for which this exercise proved particularly helpful was the technology sector.
As home to Fort Meade and premier defense agencies such as the National Security Agency (NSA), Defense Information Systems Agency (DISA) and U.S. Cyber Command, Anne Arundel County is the nation’s most prominent government and cyber technology hub.
Over several months, we met with many tech entrepreneurs to understand their challenges. They provided valuable suggestions on what resources would be most helpful, particularly those who pursue business opportunities at Fort Meade, a prominent economic driver and job center in our county and in the state of Maryland. Their feedback is the foundation of our new Arundel Defense Tech Toolbox.
While the incubator model did not propel the growth of as many businesses as we had hoped, we learned important lessons that have been helpful in the development of the Arundel Defense Tech Toolbox. We understand that many Anne Arundel County technology businesses start in someone’s basement and are financed by personal savings. We know that, for these businesses, many of which have experienced initial success, cash and customers are the drivers of expansion. That is why we believe this initiative is a better strategy to impact growth.
The signature component of the Arundel Defense Tech Toolbox is the Next Stage Tech Fund. For companies with less than 100 employees and $5 million in revenue, this financing program offers 0% loans ranging from $50,000 to $250,000. Loans can be structured with flexible payment terms between one to five years to accommodate a company’s cash flow. Businesses also can access AAEDC’s current workforce training grant program which offers a reimbursable grant of up to $1,000 per employee. A new service within this initiative provides complimentary consultations with prominent experts in the fields of commercial technology marketing, federal contracting and intellectual property.
To connect businesses to the Toolbox, we hired Sarah Purdum in May to serve as a business development associate. Her past professional experience includes working as the cyber incubator manager for [email protected] Research Park, and within the Maryland Department of Commerce’s Cyber Division. As a business development associate, Purdum will be focused on attracting, retaining and growing technology-focused companies in Anne Arundel County.
Another priority has been to enhance the county’s community revitalization efforts. We advocated for legislation and received an extension of the community revitalization tax credits, which were set to expire in April. This county incentive is available to commercial projects in designated commercial revitalization areas. Property owners apply for the tax credit after making improvements that trigger $100,000 or more in new assessed value. Tax credits are granted for a period of five years and equal the full amount of the increase due to the improvements. Such properties also are eligible for the Arundel Community Reinvestment (ACR) Loan, an interest-free loan up to $50,000 for exterior improvements.
We also reassessed the list of community revitalization districts. By eliminating some districts that have shown marked improvement, adjusting boundaries and combining some areas, we went from 16 to eight districts. This change will allow us to better target resources and incentives to the most commercially challenged communities in the county.
Relatedly, in June, the Maryland Department of Commerce conferred the enterprise zone designation to 1,600 acres in Brooklyn Park in northern Anne Arundel County. Along with our county community revitalization program, this designation gives Brooklyn Park more tools to continue the momentum that started with last year’s implementation of the Greater Baybrook Vision and Action Plan. Enterprise zone property and income tax credits will incentivize more businesses to participate in the revitalization of this community by strengthening local commerce and creating jobs.
Another recent benefit of our partnership with the state of Maryland is the state’s approval of legislation that will allow Anne Arundel County to implement a Payment in Lieu of Taxes (PILOT) agreement for economic development projects of significant public benefit. Unlike TIF or loan financing, a PILOT will allow the county and the developer to agree on an annual fee to be paid instead of property taxes. By having options such as periodic re-evaluations and the ability to end the agreement when benefits to the county cease, a PILOT is a simpler approach that provides more control for local government.
AAEDC continues its commitment to put in place programs and services that are worthwhile and effective for businesses. By continually reviewing the effectiveness of programs, we can make changes to suit the market and move closer to realizing County Executive Steve Schuh’s vision for Anne Arundel County, which is to be the best place to live, work and start a business.
For more information on Anne Arundel Economic Development Corporation’s programs and services, visit its website at www.ArundelBiz.org.