# Economic Development (GEC)

## Title 6. Economic Development Tax Incentives

### Subtitle 10. Opportunity Zone Enhancement Program

#### Section 6-1001

(a) In this subtitle the following words have the meanings indicated.

(b) "Level 1 opportunity zone enhancement" means an enhanced tax credit under the Program for which a qualified opportunity zone business or qualified opportunity fund is eligible if:

  (1) the following information is provided to the Department:

    (i) the date of the qualified opportunity fund's investment in the qualified opportunity zone business and the amount of the investment;

    (ii) the total project or business investment, including any leverage;

    (iii) the address and census tract of the qualified opportunity zone business and the qualified opportunity fund;

    (iv) the North American Industrial Classification System Code for the qualified opportunity zone business;

    (v) an impact report, including both qualitative and quantitative data on the investment and, as applicable, its progress toward:

      (1) creating and retaining jobs;

      (2) promoting entrepreneurship, including among women- and minority-owned businesses;

      (3) providing affordable housing;

      (4) creating access to healthy food;

      (5) promoting environmental sustainability; and

      (6) benefiting the communities in the opportunity zone in a manner not otherwise specified in this item; and

    (vi) unless an applicant provides an affidavit to the Department along with the application that the qualified opportunity zone business property is unoccupied, will be demolished within 1 year of the date of the application, and will remain unoccupied until the demolition is complete, with respect to qualified opportunity zone business property that is an affected property required to be registered with the Department of the Environment under Sec. 6-811 of the Environment Article:

      (1) proof of registration with the Department of the Environment;

      (2) if the property contains at least one residential rental unit, proof of lead inspections conducted in accordance with Sec.Sec. 6-815 and 6-819 of the Environment Article;

      (3) if the property is an owner-occupied residential rental property:

      (A) proof that visual exterior or interior painted surfaces are free of chipping, flaking, or peeling lead-based paint; and

      (B) a copy of passing test results for lead-contaminated dust; and

      (4) verification that, for the substantial improvement of the property performed in accordance with Sec. 1400Z-2(d)(2)(D)(ii) of the Internal Revenue Code, replacement doors and windows are free of lead-based paint; and

    (vii) any other information requested by the Department that meets the transparency goals of the Program; and

  (2) for a qualified opportunity zone business located in an opportunity zone in a county with a minimum wage that exceeds the State minimum wage, the qualified opportunity zone business pays to each employee wages that exceed the greater of:

    (i) 120% of the State minimum wage; or

    (ii) 120% of the county minimum wage.

(c) "Level 2 opportunity zone enhancement" means an enhanced tax credit under the Program for which a qualified opportunity zone business or qualified opportunity fund is eligible if:

  (1) the requirements for a Level 1 opportunity zone enhancement are met;

  (2)

    (i) accountability to residents of the communities in the opportunity zone is maintained through their representation on any governing board or advisory board of the qualified opportunity zone business; or

    (ii) a community benefits agreement is negotiated and agreed to by community groups or strategic industry partnerships, as defined under Sec. 11-701 of the Labor and Employment Article, in the opportunity zone and the qualified opportunity fund that specifies a range of community benefits that the fund agrees to provide as part of the development project, including workforce development or local hiring requirements; and

  (3)

    (i) for a qualified opportunity zone business located entirely within an opportunity zone in a municipal corporation, the municipal corporation, by resolution or by letter, delivered to the Department by the municipal corporation's authorized designee, approves the provision of the enhanced tax credits under the Program within the municipal corporation; or

    (ii) for a qualified opportunity zone business in an opportunity zone that is not located entirely within a municipal corporation, the county, by resolution or by letter, delivered to the Department by the county's authorized designee, approves the provision of the enhanced tax credits under the Program within the county.

(d) "Opportunity zone" means an area that has been designated as a qualified opportunity zone in the State under Sec. 1400Z-1 of the Internal Revenue Code.

(e) "Program" means the Opportunity Zone Enhancement Program in the Department established under Sec. 6-1002 of this subtitle that allows enhanced tax credits under:

  (1) Sec. 6-304 of this title (Job Creation);

  (2) Sec. 6-403 of this title (One Maryland economic development);

  (3) Sec. 10-702 of the Tax - General Article (wages paid in an enterprise zone);

  (4) Sec. 10-725 of the Tax - General Article (biotechnology investment incentive);

  (5) Sec. 10-733 of the Tax - General Article (cybersecurity investment incentive); and

  (6) Sec. 10-741 of the Tax - General Article (More Jobs for Marylanders).

(f) "Qualified opportunity fund" has the meaning stated in Sec. 1400Z-2 of the Internal Revenue Code.

(g) "Qualified opportunity zone business" has the meaning stated in Sec. 1400Z-2 of the Internal Revenue Code.

(h) "Qualified opportunity zone business property" has the meaning stated in Sec. 1400Z-2 of the Internal Revenue Code.

(i) "Qualified opportunity zone property" has the meaning stated in Sec. 1400Z-2 of the Internal Revenue Code.

#### Section 6-1002

(a) There is an Opportunity Zone Enhancement Program in the Department.

(b)

  (1) The Department shall administer the tax credit enhancements offered under the Program.

  (2) The enhancements offered under the Program shall be applicable to all taxable years beginning after December 31, 2018, but before January 1, 2027.

(c)

  (1) The Department shall publish on its website information about the Program and information reported by a qualified opportunity fund receiving enhanced tax credits under the Program.

  (2) The information published on the website:

    (i) shall be itemized by qualified opportunity zone;

    (ii) shall be summarized in the aggregate; and

    (iii) may not include any proprietary or confidential information.

(d) The Department, in consultation with the Department of Housing and Community Development, shall adopt regulations to carry out this subtitle, including criteria and procedures for determining eligibility for a Level 1 or Level 2 opportunity zone enhancement.

#### Section 6-1003

(a) In this section, "revitalization area" has the meaning stated in Sec. 6-301 of this title.

(b) For a qualified opportunity zone business that qualifies for a job creation tax credit under Sec. 6-304 of this title:

  (1) the Level 1 opportunity zone enhancement is equal to:

    (i) $3,075 multiplied by the number of qualified employees working in a facility not located in a revitalization area; and

    (ii) $5,125 multiplied by the number of qualified employees working in a facility located in a revitalization area; and

  (2) the Level 2 opportunity zone enhancement is equal to:

    (i) $3,300 multiplied by the number of qualified employees working in a facility not located in a revitalization area; and

    (ii) $5,500 multiplied by the number of qualified employees working in a facility located in a revitalization area.

(c) The enhanced multiplier authorized under subsection (b) of this section is in substitution for and not in addition to the multiplier under Sec. 6-304(b)(1) of this title.

#### Section 6-1004

(a) In this section, "eligible economic development project", "eligible project cost", "project tax credit", and "qualified position" have the meanings stated in Sec. 6-401 of this title.

(b) For a qualified opportunity zone business that qualifies for the One Maryland project tax credit under Sec. 6-403 of this title and creates at least 50 qualified positions:

  (1) the Level 1 opportunity zone enhancement increases the maximum credit allowed under Sec. 6-403(b)(1)(ii)1 of this title to the lesser of  $5,125,000 or the total eligible project cost for the eligible economic development project, less the amount of the credit previously taken for the project in prior taxable years; and

  (2) the Level 2 opportunity zone enhancement increases the maximum credit allowed under Sec. 6-403(b)(1)(ii)1 of this title to the lesser of $5,500,000 or the total eligible project cost for the eligible economic development project, less the amount of the credit previously taken for the project in prior taxable years.

#### Section 6-1005

(a)

  (1) In this section the following words have the meanings indicated.

  (2) "Economically disadvantaged individual", "focus area employee", and "qualified employee" have the meanings stated in Sec. 10-702 of the Tax - General Article.

  (3) "Enterprise zone" and "focus area" have the meanings stated in Sec. 5-701 of this article.

(b) For a qualified  opportunity zone business that qualifies for an income tax credit for wages paid in an enterprise zone under Sec. 10-702(c) and (d) of the Tax - General Article:

  (1) the Level 1 opportunity zone enhancement is:

    (i) up to  $1,025 of the wages paid to each qualified employee; and

    (ii) for wages paid to each qualified employee who is an economically disadvantaged individual, the credit allowed under Sec. 10-702(c) and (d) is increased by 7.5% in each of the 3 taxable years in which the credit is claimed; and

  (2) the Level 2 opportunity zone enhancement is:

    (i) up to $1,200 of the wages paid to each qualified employee; and

    (ii) for wages paid to each qualified employee who is an economically disadvantaged individual, the credit allowed under Sec. 10-702(e) of the Tax - General Article is increased by 10% in each of the 3 taxable years in which the credit is claimed.

(c) For a qualified opportunity zone business that qualifies for an income tax credit for wages paid in a focus area under Sec. 10-702(e) of the Tax - General Article:

  (1) the Level 1 opportunity zone enhancement is:

    (i) up to  $1,540 of the wages paid to each focus area employee; and

    (ii) for wages paid to each focus area employee who is an economically disadvantaged individual, the credit allowed under Sec. 10-702(e) of the Tax - General Article is increased by 7.5% in each of the 3 taxable years in which the credit is claimed; and

  (2) the  Level 2 opportunity zone enhancement is:

    (i) up to $1,750 of the wages paid to each focus area employee; and

    (ii) for wages paid to each focus area employee who is an economically disadvantaged individual, the credit allowed under Sec. 10-702(e) of the Tax - General Article is increased by 10% in each of the 3 taxable years in which the credit is claimed.

(d) The enhanced multipliers authorized under subsections (b)(1)(i) and (2)(i) and (c)(1)(i) and (2)(i) of this section are in substitution for and not in addition to the multipliers under Sec. 10-702(e) of the Tax - General Article.

#### Section 6-1006

(a) In this section, "investment", "qualified investor", and "qualified Maryland biotechnology company" have the meanings stated in Sec. 10-725 of the Tax - General Article.

(b) For a qualified opportunity fund that is a qualified investor in a qualified Maryland biotechnology company under Sec. 10-725 of the Tax - General Article, if the qualified Maryland biotechnology company, on or after March 1, 2018, is newly established in or expands into an opportunity zone:

  (1) the Level 1 opportunity zone enhancement is 65% of the investment in a qualified Maryland biotechnology company in any county, not to exceed $575,000; and

  (2) the Level 2 opportunity zone enhancement is 75% of the investment in the qualified Maryland biotechnology company in any county, not to exceed $750,000.

(c) The enhanced tax credit percentages and maximums authorized under subsection (b) of this section are in substitution for and not in addition to the percentages and maximums under Sec. 10-725(d) of the Tax - General Article.

#### Section 6-1007

(a) In this section, "investment", "qualified investor", and "qualified Maryland technology company" have the meanings stated in Sec. 10-733 of the Tax - General Article.

(b) For a qualified opportunity fund that is a qualified investor in a qualified Maryland technology company under Sec. 10-733 of the Tax - General Article, if the qualified Maryland technology company, on or after March 1, 2018, is newly established in or expands into an opportunity zone in a county other than Allegany County, Dorchester County, Garrett County, or Somerset County:

  (1) the Level 1 opportunity zone enhancement is 33% of the investment in a qualified Maryland technology company, not to exceed $300,000; and

  (2) the Level 2 opportunity zone enhancement is 50% of the investment in the qualified Maryland technology company, not to exceed $500,000.

(c) The enhanced tax credit percentages and maximums authorized under subsection (b) of this section are in substitution for and not in addition to the percentages and maximums under Sec. 10-733(d) of the Tax - General Article.

#### Section 6-1008

(a) In this section, "eligible project" and "qualified position" have the meanings stated in Sec. 6-801 of this title.

(b) For a qualified opportunity zone business that qualifies for a More Jobs for Marylanders Program tax credit under Sec. 10-741(b) of the Tax - General Article:

  (1) the Level 1 opportunity zone enhancement is equal to 6% of the total amount of wages paid for each qualified position at an eligible project; and

  (2) the Level 2 opportunity zone enhancement is equal to 6.25% of the total amount of wages paid for each qualified position at an eligible project.

(c) The enhanced tax credit percentages authorized under subsection (b) of this section are in substitution for and not in addition to the State employer withholding amount under Sec. 10-741(b) of the Tax - General Article.

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Md. Code Ann., Econ. Dev. (as displayed at mgaleg.maryland.gov, October 16, 2026)