Tax Breaks

The state's fledgling biotechnology companies need additional tax breaks if they are to flourish, two players in the state's biotechnology game said at a congressional hearing in Baltimore yesterday.Crop Genetics International has raised nearly $65 million but is still four to five years away from bringing any significant product to the market, said Dr. James H. Davis, vice president of research and development for the Hanover-based company.Like most other businesses that need to raise capital, his company would like to see tax breaks reinstated for long-term capital gains to help shake loose more money from venture capitalists.

WASHINGTON -- The Supreme Court seemed unlikely yesterday to second-guess a plan by Ohio legislators to offer lucrative tax incentives to companies that expand their investments in the state. In arguments before the justices, Ohio and Michigan taxpayers who object to the plan had a hard time on several fronts. The justices seemed skeptical that the taxpayers even had standing to challenge the plan in federal courts. Beyond that, the justices who spoke up during the hearing seemed to think that the dispute over such tax-incentive plans was political in nature, and best left to elected officials to settle.

Easing the way for construction of the Wyndham hotel to begin in the spring, the City Council set a March hearing date yesterday on a scaled-down tax relief bill for the project.The hearing will also give opponents of the controversial Inner Harbor East hotel one final time to persuade lawmakers to withdraw their support.But instead of preparing for an onslaught from outraged opponents of the hotel, developers and council members were patting each other on the back yesterday for forging the deal to build the $134 million project.

With Marriott International Inc. pushing for more financial enticements from the state government and Montgomery County to keep its corporate headquarters in Maryland, several lawmakers said yesterday that the company's demands go too far.Some lawmakers from Montgomery County even said the state should stop negotiating, and dared the giant hotel-management firm to follow through on its threat and move to Virginia."

Baltimore should consider subsidizing new downtown office buildings in much the same way it is assisting development of hotels such as the $134 million Wyndham International Inner Harbor East, according to a consultant's study conducted for the city.The study, by Bolan Smart Associates of Washington, contends that, because the downtown has "generally limited growth in net demand," subsidies or property tax breaks should be provided to spur construction of new Class A office space.Specifically, the city's economic development agency should consider "payment-in-lieu-of-taxes" programs to stimulate new development, or risk losing key businesses.

Upset with a plan by Gov. Parris N. Glendening to end a multimillion-dollar tax break for utility companies that provides grants to some counties, electric industry officials and county administrators found themselves allies in Annapolis yesterday. The two groups sought assurance from members of the House Ways and Means and Environmental Matters committees that the programs - devised in 1999 as part of the state's electricity deregulation package - will continue for at least another year.

Legislation giving lucrative tax breaks to developers of hotels and other major projects in downtown Baltimore cleared the General Assembly last night in the waning hours of the 90-day session.The measure, a priority of downtown development advocates, received overwhelming approval from the Senate and House of Delegates, despite complaints from some Baltimore community groups about the bill's favored treatment of politically connected developers, such as bakery magnate John Paterakis Sr.The bill passed the Senate by a vote of 46-1, with Baltimore Democrat Perry Sfikas the lone dissenter, and the House by 115-19.

A developer who has spent millions of dollars rehabilitating old Baltimore buildings, and has become one of downtown's largest housing providers, has stopped work on his latest project because a mix-up with the city is threatening his tax breaks. David Hillman, chairman of Southern Management Corp., said tax relief is essential for his $20 million project to convert the historic Stanbalt Building in the 500 block of St. Paul St. from offices to apartments. City leaders stressed their desire for the investment in the city and said the tax breaks are not in jeopardy.

With Maryland facing a $1.2 billion budget hole next year, the time has come to end tax breaks for ski mountains, country clubs and purchasers of bulk gold and platinum, says a group that has scoured the state tax code for loopholes. Progressive Maryland, an alliance of labor unions, faith-based organizations and community groups, said yesterday it has identified 52 tax exceptions that primarily benefit corporations and the wealthy. Their elimination would generate at least $421 million for the state budget, meaning vital services to children and seniors could be spared cuts, the report concludes.

Harford County wants to join other jurisdictions in the metropolitan area that offer property tax breaks for some senior citizens and others on fixed incomes, as local governments seek to offer relief to residents who face rising tax bills in homes that have appreciated rapidly in recent years. Baltimore, Carroll and Howard counties are among the jurisdictions that have approved property tax relief initiatives, and Baltimore City is considering one. Jurisdictions in dozens of other states have implemented similar programs.