Matthew Santoni, The Examiner
2007-09-21 07:00:00.0
Current rank: Not ranked

Harford County -

Harford businesses around Aberdeen Proving Ground fear a competitive disadvantage when a tax-exempt, 2 million-square-foot office complex opens on APG land.

With BRAC expected to cause demand for office space to soar, business leaders say they’ll have trouble matching Bethesda-based Opus East’s tax-exempt status and location on the Army base.

Contractors building office space off-base will have to shoulder county and state property taxes, while on-base builders may pass their lower costs on to their tenants, said Joseph Oricchio, a consultant and member of Harford County’s Business BRAC Advisory Committee.

The on-base location, too, will weigh in favor of Opus tenants, he said: “You can’t say to a potential tenant, ‘I’ve got a great location just two miles from the base’ when the guy on base can say, ‘I’ve got an even better location.’ ”

Opus plans to lease commercial office space to defense contractors on 200 acres at APG for the Government and Technology Enterprise project.

Federal law exempts land on U.S. military bases from local and state property taxes.

In Anne Arundel County, a similar project at Fort Meade has drawn concern because developer Trammell Crow will pay no property taxes on 175 acres of the Meade property. If taxed, the Meade property could generate $260 million in annual revenue, officials said.

Harford’s accounting office did not provide how much the APG land could generate in property taxes.

To offset the possibility of lost tax revenue, the Army is considering “payments in lieu of taxes,” in which contractors would undertake municipal projects like expanded roads or infrastructure.

Aberdeen Mayor S. Fred Simmons praised Opus and its GATE project, saying the project reflected an early display of confidence in the base’s potential.

“Thirty months ago, when we began the lease process, no one considered we’d be the recipient of all these BRAC jobs,” Simmons said. “These people made a big investment in Aberdeen when people weren't believing in Aberdeen. The city remains grateful to Opus for their prophetic decision.”

BY THE NUMBERS

Base Realignment and Closure is expected to bring about 8,700 military jobs to Aberdeen and another 7,200 defense contractors.

msantoni@baltimoreexaminer.com