Maryland taxpayers will provide Giant Food Inc. $2 million in grants, tax credits and other incentives to build its distribution center in the state, officials acknowledged yesterday.
The deal to retain Giant was announced last week, although officials declined then to reveal the details of the incentive plans.
The largest portion of the incentive package is a $1.25 million grant from the state's Sunny Day Fund, officials said. In addition, the state is offering a $250,000 training grant and $250,000 in job tax credits, a spokeswoman from the state Department of Business and Economic Development said.
Howard County is offering an additional $250,000 in road improvements for the distribution center, which will be constructed on a 72-acre site at U.S. 1 and Dorsey Run Road.
The incentive package is subject to approval by the state's Legislative Policy Committee, which is scheduled to consider the agreement June 11.
The grocery chain must create 250 new jobs in the county to qualify for the tax credit, the DBED spokeswoman said.
Barry F. Scher, vice president for public affairs for Giant, declined to say whether the company intends to hire more people. He said only that the company would transfer 550 warehouse and driving jobs from Prince George's County.
Giant announced last week it would build a 368,000-square- foot facility in Howard County to distribute produce, meat, deli products and seafood. The company had threatened to build elsewhere and said it considered sites in Delaware and Virginia as well as Anne Arundel and Prince George's counties.
The company has a distribution center three miles from where the new facility is to be built. Giant has 108 stores in Maryland, 62 in Virginia and 17 in Washington, Delaware and New Jersey.
As part of the incentive package offered by the state, the Maryland Economic Development Corp. will act as a project financier for Royal Ahold NV, Giant's Dutch parent company. MEDCO will build the facility using Ahold's credit and negotiate a long-term lease-back arrangement for the company.
Tax money will not be used in the transaction, which could cost between $35 million and $45 million, Hans F. Mayer, MEDCO's executive director, said.
Howard County will kick in $250,000 to help build a proposed section of Dorsey Run Road that would improve access to Giant's facility. The county also agreed to speed up the building-approval process. Giant hopes to break ground this summer and have the facility operational by next summer.
"The No. 1 incentive is fast-track permitting," said Richard W. Story, county economic development director. "Time is money."