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Understanding and Marketing Arts & Entertainment District Property Tax Incentives

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Maryland State Arts Council: Good morning everyone Welcome to the webinar "Understanding and Marketing A & E District Property Tax Incentives

" My name is Steven Skerritt-Davis I'm the Deputy Director here at the Maryland State Arts Council and I am joined by Maryland State Arts Council: Arthur: My name's Arthur Brown and I am the Assistant to the Deputy Director here at MSAC

Steven: Also joining us today, as part of the presentation, are two district managers First, Jen Merritt Jen, would you like to say hello and quickly introduce yourself? Jennifer Merritt: Good morning everyone I am an Arts & Entertainment District Coordinator for Crisfield Maryland State Arts Council: Great

Thanks, Jen Maryland State Arts Council: And also, Stuart Eisenberg is here Stuart, would you like to say hello and quickly introduce yourself? Maryland State Arts Council: oh, Stuart, I have not unmuted you I am unmuting you now Hey, thanks

Maryland State Arts Council: Go ahead, Stuart Stuart Eisenberg: Hi Hi, Stuart Eisenberg with Hyattsville Community Development Corporation and I operate the Prince George's County Gateway Arts and Entertainment district Maryland State Arts Council: Okay Thanks, Stuart

Alright, I am going to turn off our video because Maryland State Arts Council: I will direct most of our attention to the PowerPoint this morning And, we will go ahead and get started Maryland State Arts Council: So just a few housekeeping items before we begin Maryland State Arts Council: There is a chat function available It should be to the right of the screen, and there should be a way to open your chat

Maryland State Arts Council: If you'd like to broadcast messages to the entire group, or ask questions within the chat, Arthur will be here monitoring the chat and we'll we'll break in with questions as needed Maryland State Arts Council: If at some point, you need to exit out of the webinar, you simply hit the "Leave Meeting" button on the lower right hand corner of your screen

Maryland State Arts Council: If you're having trouble automatically connecting to the computer audio, try clicking the "Join Audio" button on the lower left Maryland State Arts Council: corner of your screen Maryland State Arts Council: And if you have questions you can ask those questions in the Q & A panel Maryland State Arts Council: You can also ask questions by raising, or lowering, your hand Again, Arthur's here to monitor that And he will Maryland State Arts Council: let me know if a hand has been lowered or raised, and we can unmute you at that point, and can have you ask your question

Maryland State Arts Council: I just to be clear, we have muted everybody on the call today Just so everyone has the opportunity to hear the presentation

But, yes, you can raise or lower your hand; you can ask questions or talk with us through the chat function Maryland State Arts Council: Also you can zoom in and out of your screen So, on the upper right hand corner you can see the various options for Maryland State Arts Council: the size of your screen I would suggest Arthur would suggest using "Fit to Window" and adjusting the window to the size of your choosing

But you have plenty of options there Maryland State Arts Council: So let's go ahead and get started, I just want to be very clear from the beginning who and what this webinar Maryland State Arts Council: is meant for and what we'll cover because it is not general information that Maryland State Arts Council: Everybody might have an interest in So this is primarily for arts and entertainment district managers, we're covering Maryland State Arts Council: A general overview of property tax incentives and covering in particular, the process of setting up and implementing a tax incentive program in a locality So this can get a little technical and Maryland State Arts Council: Maybe will be a little bit dry and boring for people who are not arts and entertainment district managers It might even be a technical and boring for those who are arts and entertainment district managers, hopefully not too Maryland State Arts Council: Technical and boring, but I just want to be clear that this, we're not here to answer questions about particular tax incentives in particular districts, we're here to talk about the property tax incentives statewide and how to set up those processes in local districts Maryland State Arts Council: We'll go through a typical process in the interest of sort of showing what a typical process looks like

And we'll also hear from Jen and from Stuart about what they gone through in setting up their tax incentive processes and also some tips and tricks and Maryland State Arts Council: Things for discussion in implementing and marketing tax incentives locally and we are probably going to run really close to time and so we might be more on the Maryland State Arts Council: Implementing and understanding the incentives, than on the marketing of incentives We will try to briefly go over that and have a discussion about marketing Maryland State Arts Council: I would like to follow up with the district managers, probably at the manager meeting in June or on a subsequent webinar with more tips and tricks about marketing Maryland State Arts Council: So I'm going to pause right now and I'll pause periodically throughout my part of the presentation for questions Maryland State Arts Council: I'm going to check in with Arthur

Are there any questions so far? Maryland State Arts Council: Alrighty, so we will move forward Maryland State Arts Council: So the basic overview Maryland's Arts and Entertainment Districts designation program allows local governments to create property tax credits So what you'll see on your screen is the copy of the property tax credit or property tax article Maryland State Arts Council: That refers to arts and entertainment districts This is what allows the local governments to set up property tax credits Maryland State Arts Council: But the program does not create a process

So in the application for designation local governments have to supply the local credits usually through a resolution This is required in designation applications Maryland State Arts Council: Those resolutions go over what the local jurisdiction is offering in terms of property tax credits Sometimes that's 100% of the Maryland State Arts Council: Difference between the pre-renovation or pre-construction value and the post construction value of a property, but in some cases there is a graduated schedule and Maryland State Arts Council: Either a decline in the amount of credit or the amount of time that a credit can be applied to a property Maryland State Arts Council: Local governments must create the process for applying for property tax credits, following designation

Maryland State Arts Council: We like to stress that this should be in collaboration with the districts, in reality, often the districts need to lead the process And so that's what we're going to go through Maryland State Arts Council: right now In conversations with district managers across the state, there are some districts in which the property tax credit application process was never set up And we also have some new districts coming online, that might need to get on this process sooner rather than later, Maryland State Arts Council: So that property owners within districts can benefit from the property tax incentives So that's what we'll go over in the rest of the presentation

Maryland State Arts Council: Before I go forward I'm going to pause for questions again Again, you can raise your hand or ask a question through the chat Arthur do we have anything? Maryland State Arts Council: Arthur: Yes, I just wanted to remind everyone that a copy of this recording will be sent out after today's webinar So if you have any questions or you would like a copy, I should be sending out an email soon after today

Maryland State Arts Council: Great, thank you Any other questions generally about the property tax incentive article? Maryland State Arts Council: Or about the resolutions that are included with applications or with the requirement that a local government create the process before we go into some more detail? Maryland State Arts Council: Yes, the slides Maryland State Arts Council: Alright, we'll move forward then Maryland State Arts Council: So where to start? Personal know your resolution So with the application came resolutions and depending on who the applicant was whether it was a municipality, or a county applicant and what jurisdictions were involved

Sometimes there are multiple municipal jurisdictions within Maryland State Arts Council: An A&E district and Stuart can speak to that And sometimes there's a city and a county Sometimes the city or the town will offer an incentive that The county will not Maryland State Arts Council: Build still need supportive, but they won't offer an incentive So knowing your resolutions and knowing what incentives were approved when your, your, does it when your designation went into effect

Maryland State Arts Council: Is the official first step If you do not have copies of those resolutions on file in your office, we have copies of those original applications or re designation applications in our office, Arthur and his predecessor Teara Maryland State Arts Council: Worked on digitizing those applications So we have them as PDFs that we can share with you so you can be in touch with Arthur after today's webinar If you have questions about your resolutions, but that's the first place to start Maryland State Arts Council: The next step is identifying the right people to talk with Maryland State Arts Council: I would recommend a meeting with the relevant people Maryland State Arts Council: If you are not as a management entity, the local Economic Development Office then finding the county or city Economic Development Office and particularly the person who would be in charge of incentives

Maryland State Arts Council: Is a great person to bring into the room Also, the Department of Finance, collections, whatever the agency is in the municipality or the county government that they have a job relevant to tax incentives, they should also be part of the conversation Maryland State Arts Council: A good place to start So a key rule of thumb is to look at the Enterprise zone process when you're setting up an A&E districts process Maryland State Arts Council: It's not an analogous incentive by any means, but in the process is often very similar and Maryland State Arts Council: It can often translates at least parts of the process or the application and can translate from the enterprise zone process

So rather than starting from scratch I'm starting with the enterpise zone process and modifying to the arts and entertainment district incentive Maryland State Arts Council: Is often a good place to start Maryland State Arts Council: So the typical process And this is boiled down that the typical process is a property owner would submit an application before a renovation project or a construction project starts Maryland State Arts Council: If it's if it's relevant to Maryland State Arts Council: An arts use So for use by a qualified residing residing artist or by an arts and entertainment enterprise

Maryland State Arts Council: Then the property owner submittes to the State Department of assessments and tests taxation, which will refer to as SDAT throughout the presentation Maryland State Arts Council: They submit that reassessment information So what was the change in value because of the renovation or the new construction and then the credit is calculated it's approved and administered So that's easy Right

Maryland State Arts Council: It's usually in practice, not so easy So we're going to break down each of these three steps Maryland State Arts Council: But before we get into that breakdown and you want to pause again for some questions I see some activity on the chat So I'm going to ask Arthur to clue me in

Arthur: So David has a question about where to begin Should we include county commissioners and EDC? Maryland State Arts Council: Yes, usually probably not the county commissioners because they have likely signed up off on the Maryland State Arts Council: Resolution that that is included in the designation application and they probably won't get into the nitty gritty of creating the process for applying for it or for a property tax credit, but by EDC You're talking about economic development commission or office Maryland State Arts Council: Finding the correct person there is usually a helpful person to have in the conversation Maryland State Arts Council: Stuart's question

Maryland State Arts Council: So from Jim Maryland State Arts Council: We will talk a little bit more about the, the question is about the calculation of Maryland State Arts Council: The tax credit We will talk a little bit about it later, it is, it does vary by district and by buying localities So we'll talk a little bit about that But we won't get into specifics for particular districts Maryland State Arts Council: Alright, so going into this first step, the property under submits an application before work begins So when you're putting together what the process looks like

Maryland State Arts Council: Some questions to ask are To whom does the property owner submit an application Maryland State Arts Council: Does usually this goes to the department of finance or to the city or to the county governments but nailing down who which office that application goes to is crucial Maryland State Arts Council: Um what information is needed on the form So the forms differ by locality, Jen will talk a little bit about information needed on her form down in Crisfield but Maryland State Arts Council: That information, whatever information is needed will vary and so nailing that down is also crucial Maryland State Arts Council: What documentation is required so on the application does the property owner submit the current assessment often Maryland State Arts Council: I know in Baltimore City and in crisfield work permits are included

Usually the permit triggers some other steps in the process So the talking with a local officials about Maryland State Arts Council: About what's needed with the application in terms of work permits and how that affects the rest of the process is also very helpful and then Maryland State Arts Council: I see as a crucial part of this How is the A&E DISTRICT MANAGEMENT involved? So there's nothing in the property tax article that lays out the A&E DISTRICT MANAGEMENT entities involvement in this process Maryland State Arts Council: However, as the A&E district managers know we do ask on your annual reports for information about the property tax credits applied for within your jurisdiction and so Maryland State Arts Council: Having to include into what applications are coming in and what approvals are going through is crucial So nailing that down in these conversations about what the process looks like is is also very helpful not only in just keeping Maryland State Arts Council: The A&E DISTRICT MANAGEMENT informed, but also in your reporting requirements

Maryland State Arts Council: Any questions this point? Maryland State Arts Council: Don't see any Maryland State Arts Council: So next step in the process So after the work goes through the property owner has to submit a SDAT reassessment Maryland State Arts Council: So the property owner has to request a reassessment Maryland State Arts Council: I am still unclear in my conversations with SDAT about this, what triggers this But what I've heard is that the permitting process that the Maryland State Arts Council: When the permits are applied for and approved that the SDAT assessment is triggered And so it's important to also know about the hundred thousand dollar three year rule so Maryland State Arts Council: The State Department of assessments and taxation as any property owner in the state knows does their reassessments on a three year cycle Maryland State Arts Council: To request a risk assessment outside of that three year cycle in order to access credits, like this one

The project has to be over $100,000 Maryland State Arts Council: So small projects, a small renovation to gets gallery space ready for a gallery, so very small renovations under $100,000 would not trigger a reassessment and Jen will talk a little bit about how they navigated this Maryland State Arts Council: In crisfield we're still working on getting some clarity around this So if Maryland State Arts Council: If that becomes clearer We will send out an update to all of the all of the district managers Maryland State Arts Council: And then knowing the window to submit the reassessment value for the credit is crucial Maryland State Arts Council: The, this will be determined by the Department of budget or finance or collections and what their requirements are what we typically see is about a 90 day window

So from the date of assessment to submitting that for the credit that 90 days is typical Maryland State Arts Council: Any questions at this point Maryland State Arts Council: Alright Maryland State Arts Council: So then the credit is calculated approved and administered so documenting the who how and when is also important when setting up this process Maryland State Arts Council: And then understanding who certifies that the property is located in an arts and entertainment district end is Maryland State Arts Council: Referring back to the property tax article here wholly or partially constructed or renovated to be capable for use by a qualified residing artist or arts and entertainment enterprise so Maryland State Arts Council: Different localities

Look at this differently in some cases city official or Maryland State Arts Council: Somebody within the department of budget would make this determination Sometimes that is done in coordination with the arts and entertainment district management Sometimes it is Maryland State Arts Council: The responsibility of the arts and entertainment district manager to weigh in on whether it is located in the district and constructed or renovated for capable use Maryland State Arts Council: A quick note about capable us there is Maryland State Arts Council: Well, we've asked the question of our the attorney general's office for some clarity around this as well And we haven't we now have lawyers talking to lawyers in two different departments Maryland State Arts Council: To understand a little bit better about this capable for us and to get some clarity on this

We are in the process of Maryland State Arts Council: Looking at this program, we're looking at the grant program right now in our Maryland State Arts Council: revision process will be looking at the legislation and regulations in a process that will kick off in March and go into April And so this is likely going to be part of that discussion and any updates will come to the A&E district managers as we get more clarity about this Maryland State Arts Council: Some other questions, the credit is calculate, excuse me, who has approval authority, who is actually signing off and approving excuse me approving the tax of the tax incentive and the credits is Maryland State Arts Council: Is going to go through what is ongoing certification Here we're looking for clarity on from the, from the attorney general's office about Maryland State Arts Council: Ongoing certification So does the in several of the tax incentive processes around the state compliance with code is a requirement and so certification yearly that Maryland State Arts Council: The property is in compliance with code is sometimes a requirement

And sometimes there's a requirement that the space retain an eligibility Jamie Heater: Will send all this stuff to us after so that we can talk about it I did do my giant spreadsheet This is the only thing I'm allowed to do besides Maryland State Arts Council: I think we have somebody waiting in a queue You can mute yourself, that would be great

Maryland State Arts Council: It's Maryland State Arts Council: So, Maryland State Arts Council: Getting back to the presentation Maryland State Arts Council: The requirement that the space retain an eligible use that it be capable for use by and Maryland State Arts Council: Qualified residing artists are an Arts and Entertainment enterprise, there are We are still waiting for the Attorney General to weigh in on this and Maryland State Arts Council: In some jurisdictions documentation of this is required I mean documentation of of occupancy by an arts organization or qualified residing artist is required So we're getting some clarity on that and and we will pass that along as we get clarity

Maryland State Arts Council: Another important thing What happens when applications are not approved So just as important as who approves and how the applicant is notified Maryland State Arts Council: What happens when they are not approved Is there's an appeals process, etc

And again, going back to the A&E DISTRICT MANAGEMENT involvement Maryland State Arts Council: How is the A&E DISTRICT MANAGEMENT notified that approval has happened or application has been denied so spelling, all of that out in those initial meetings about Maryland State Arts Council: How this process will work, what the application looks like all of that is very important And again, we will share this following the presentation Maryland State Arts Council: And we are available for questions But we'll pause for questions right now before I hand this over to our other presenters there

Any other questions? Maryland State Arts Council: All right, so see no hands and see no additional questions in the chat box I'm going to hand over the presentation to Jen Merritt Maryland State Arts Council: Who Maryland State Arts Council: Introduced yourself earlier as the coordinator for the Crisfield district Maryland State Arts Council: And where are you Jennifer Merritt: Hello everyone Maryland State Arts Council: So I'm going to move on to your slides and if you just want to let me know when to move to the next slide, I will do that Jennifer Merritt: Okay

Sounds good Next slide please Jennifer Merritt: So the Crisfield Arts & Entertainment district is relatively new We were designated July 1st of 2018 Jennifer Merritt: And we thought that we had created the process needed for the property tax incentive Jennifer Merritt: But I'm going to go over how that went

Jennifer Merritt: I had Jennifer Merritt: Taken it an application from another A&E District modified it to reflect crisfield regulations and run it by our attorney, the city's attorney and put it on the website Next slide please Jennifer Merritt: So we were very lucky that both the city and the county passed 100% tax credits for 10 years And as I said, I got the application posted online Jennifer Merritt: We were doing well about reminding the community that there were three types of tax incentives available and people were relatively aware of that

Jennifer Merritt: About a year after designation One of the community members who had already completed interior renovations asked us to hold a public meeting about how to go through the application process he was aware of another business owner, who was interested in renovations and thought we could Jennifer Merritt: convey this information to everyone at once Next slide please Jennifer Merritt: So, Jennifer Merritt: These are the steps that we had in place at the time of the meeting And I won't go through each one of them

Jennifer Merritt: There are approximately the steps that Steven described Jennifer Merritt: Notice that step six says provide evidence annually, that the buildings continues to meet the requirements as an arts and entertainment venue and Next slide please Jennifer Merritt: So, Jennifer Merritt: Just before the meeting the public meeting immediately before the public meeting Jennifer Merritt: We met with the county tax assessor and and thank you to Stuart Eisenberg for assisting and leading this meeting We met with the county tax assessor and the city treasurer and it became apparent that the documentation

We had online really wouldn't work Jennifer Merritt: One of the issues with it Jennifer Merritt: Was that I had assumed that we would be able to get reassessments Jennifer Merritt: In a timeline with construction, but there is that three year rule for anything under $100,000 Jennifer Merritt: And it turned out that the individual who was interested in holding this meeting the community member Jennifer Merritt: Probably will not have any increase in his assessment anyway because interior renovations don't usually trigger an assessment increase Jennifer Merritt: That was a good thing because we had not talked at all before he began his work about this process And Jennifer Merritt: So the important issues that were identified during this meeting where the hundred thousand dollar threshold for assessment Crisfield is a small community Most of our Jennifer Merritt: Renovations wouldn't be anywhere near that

And people were concerned that they would pay increase taxes Jennifer Merritt: Because they wouldn't meet that threshold Jennifer Merritt: And they were also concerned that they would be penalized if they had renovated their building for an arts and entertainment Jennifer Merritt: Enterprise and the enterprise had moved in and then had moved back out Jennifer Merritt: Next slide please

Jennifer Merritt: So we met again after that public meeting and thank you to Steven for coming to join us and we were, we were very lucky that our tax assessor really wanted to work with us to make this process as manageable as possible Jennifer Merritt: So he said there's no flexibility in the assessment for renovations under $100,000 but Jennifer Merritt: People who have, say they do $50,000 of renovations, they're not going to end up paying an increased tax Jennifer Merritt: Because as long as they apply within 90 days of receiving that tax assessment that three year tax assessment They paid no increased taxes during that three years Jennifer Merritt: He agreed to come up with a formula to calculate the change Jennifer Merritt: Accounting for market value because the Tax assessor's concern was Jennifer Merritt: That it would be difficult to tell the difference between an increase in taxes due to increase in market value and an increase due to renovations and that's one of the reasons that it's important to Jennifer Merritt: To have a building permit and also to talk to people before they begin their renovations

And Jennifer Merritt: Another outcome of this meeting was the city will review the property for occupation or just Jennifer Merritt: To be sure that it's being marketed for occupation by an arts entertainment district enterprise Jennifer Merritt: So that people who have renovated their buildings had an arts entity that then moved out are not penalized for having an empty building as long as they are actively trying to recruit someone to to move in and that Jennifer Merritt: Review would take place every three years instead of annually, to place less of a burden on both the city and the property owner and I also wanted to mention that as far as reviewing the applications Jennifer Merritt: The city clerk wanted to have several people on a committee So as I said, we're a small town and she didn't want it, understandably, always on her whether people's people she would probably know whether their applications were accepted or rejected So the A&E coordinator Jennifer Merritt: As well as the Jennifer Merritt: Zoning director and member of the chamber of commerce will review those applications

Jennifer Merritt: Next slide please Jennifer Merritt: Okay, so that that is it Right Are there any questions? Maryland State Arts Council: I don't think we have any questions coming in or any hands raised at the moment And I do want to thank you, Jen

That's, that's a great illustration of the process and also some of the Maryland State Arts Council: hiccups that you've found along the way and some questions that you answered along the way as well So thank you for sharing Maryland State Arts Council: I do want to address a question that's come up now twice, the process for the calculation of the tax credit Maryland State Arts Council: And that is a locally determined It's different based on what is contained in your resolution

So in most resolutions there, the Maryland State Arts Council: Credit is the difference between the pre rent renovation assessment and the post renovation assessment So the gap there So usually, how much the property has increased value between when it was assessed before renovation and when it is assessed after That's the amount of the credit Maryland State Arts Council: In some places, that's 100% and so that full amount is the credit and in some places It's a percentage and in some places it declines over time or sunsets

At a certain point, so that calculation differs by locality Maryland State Arts Council: Hope that if there are clarifications needed Maryland State Arts Council: Is there a usual method regarding new construction? Maryland State Arts Council: That's a great question I think that pertaining to new construction, it's still the assessment, the difference in assessment Maryland State Arts Council: It would be a great question to ask in those meetings about setting up a process to get some clarity on that because if Maryland State Arts Council: A percentage of the property is not used for Arts use or if a percentage is considered just general construction and percentages for arts use Maryland State Arts Council: That would all have to be sorted out within creating the process in the locality, but the, and in reference to the local resolutions that were passed by the State, from the State view, the program opens up that property tax credits possibility and then the details are determined on the local level Maryland State Arts Council: And Stuart, you have your hand raised

Stuart Eisenberg: Yeah, so I was just gonna follow up and clarify a little bit with respect to what is eligible in an improvement in the interior because there are many insured improvements that might be eligible Stuart Eisenberg: For changing an assessment, but things like maintenance, your paint, a repair that is kind of an annual thing or a semi annual thing is going to not Stuart Eisenberg: Improve your assessment or increase in assessment or trigger that Stuart Eisenberg: But if the work is structural, if you're putting in new window glass You're changing a facade over your, you're putting a roof, where a roof Stuart Eisenberg: Hasn't been for a while If you're doing those sorts of things, then those will count for somebody's increased assessment and so it may be that your, your tax people your assessment office will want a more itemized Stuart Eisenberg: Accounting of construction and how they allocate for the percentage of improvement value because usually when you when you are putting in a building permit Most jurisdictions, ask for the estimated cost or value of the improvements that you're making And that is a basis

Stuart Eisenberg: With the assessment office for potentially changing the assessment on the property Stuart Eisenberg: Does that make sense to everyone Maryland State Arts Council: Thank you Stuart Yeah Maryland State Arts Council: And Ivy (Ivy Wells) yes similar to enterprise zones, but not completely one to one similar, but not the same

Maryland State Arts Council: Stuart do you want to go ahead and talk through your slides before we open up for general questions and discussion? Stuart Eisenberg: Sure, so we were looking at how to market the tax credits and when I did this Stuart Eisenberg: Presentation down in Crisfield, a more fundamental issue comes up, which is you need to manifest your arts district in order to Stuart Eisenberg: Market tax credits People have to be aware of your district And so some very basic things have to be in place, all the low hanging fruit in order for you to successfully induce Stuart Eisenberg: Investors or extant property owners to do something, where they haven't done it before And so, rolling back promoting your arts district to all the property owners within the district, getting everyone on board is critical, as well as targeting the properties So getting your, your Stuart Eisenberg: Your, your website up, making sure all the people who are within your district that are running businesses are subscribed to to these things and Stuart Eisenberg: Are registered within it

So having a business directory as well as an artist directory and a way to communicate what is for lease in the way of your, your studios outside of the regular lease process with real estate agents Next slide Stuart Eisenberg: Okay, so there's variety of ways that we manifest economic development for Stuart Eisenberg: Inducing investment in our area and making sure that you're you're you're getting all of those avenues covered Stuart Eisenberg: Information about all the tax benefits, not just this one because it may be the case I know in Prince George's County, it's the case that you can't have overlapping tax credits apply So you have to pick one

So you might want to pick the best one Stuart Eisenberg: And and talk to the property owner about what their best option is as the district manager, it may make more sense to promote a revitalization tax credit, or an Enterprise zone tax credit if that is contemporaneous or within the same space as your arts and entertainment district Stuart Eisenberg: So making sure that all the options are on the table for folks who were considering investing in your community Stuart Eisenberg: It's important and optimizing their options as well So that's part, that's all part of marketing your district, so making sure that the local land use rules and market conditions are known and readily available to share Stuart Eisenberg: As well as taking interested parties on tours for the area that's a great way to promote the tax credit

Stuart Eisenberg: Okay, next slide Stuart Eisenberg: Some people like to, you know, like to do their own research And so what we like to do online Anyway, especially for entrepreneurs and Stuart Eisenberg: Creative folks is let them do their own analysis So we try to put as much information as possible

Stuart Eisenberg: Online and then folks can contact us after they've figured out what they want to figure out, or if they have questions and need more assistance So all of these subject areas Stuart Eisenberg: Land use information about what the marketplace looks like what the zoning and planning goals are real estate listings business and property databases other tools for small business and we have a real estate tax credit calculator and that's that's been helpful also So, next slide Stuart Eisenberg: In Prince George's County in our Arts and Entertainment District, the Gateway Arts District, we have four municipalities and each of them has a different Stuart Eisenberg: Tax rate and each of them has a different county tax rate as well

So when we're when we're calculating what the credit is we have to create formulas Stuart Eisenberg: That work for any one of the the district properties and and the county level tax credit So not only do we have to set this up with the municipalities, but we have to do this with the county as well So we have separate processes for each of those and all of that goes to the state Stuart Eisenberg: Assessment office within the county for for implementation So we have a formula based Stuart Eisenberg: Activity where you can enter your, your, the subject properties assessment before the renovation and after and you press a button and then this will calculate your property tax savings over a number of years So Stuart Eisenberg: We've, we've done this for a couple of jurisdictions for different types of tax credits

Next slide Stuart Eisenberg: And so we showed Crisfield what that might look like And I'll ask you to go back and forth our tax credit is progressively diminishing by 20% over, over five years so that the assessment Stuart Eisenberg: Increases by 20% Stuart Eisenberg: Every year in the differential whereas Crisfield has a 100% tax credit over over 10 years So the difference in the same investment or change in property Crisfield would generate $112,200 for an improvement like this whereas in our jurisdiction if you go back one

Stuart Eisenberg: The amount is $24,000 so it's a far more powerful Stuart Eisenberg: tax incentive in Crisfield and there are number of reasons why a jurisdiction might want to have a more powerful tax credit Stuart Eisenberg: But a tool like this gives folks instant information and they can make good determinations, or you can guide them Stuart Eisenberg: On the level of investment that's appropriate and how they can improve their business model for for deciding what level of improvements, they're going to Stuart Eisenberg: Pursue So these are all I think marketing our tax credit because we're making it clear how how how impactful This is and I hate that word, sorry

Stuart Eisenberg: What kind of impact this this generates in the locality, so you can compare this to other tax credits Also, in order to guide investors or interested business people Stuart Eisenberg: And I think that's my last slide, but we also talked in manifesting an arts district and manifesting Stuart Eisenberg: I mean in marketing your tax credit is actually going for the lowest hanging fruit in order to manifest your arts district's public art and public art programs that Stuart Eisenberg: don't require a lot of money to implement because not every district has a big budget for public art or property owners or investors that are putting $50,000 or $125,000 public sculptures up so ways Stuart Eisenberg: Programs that can bring public art at a low modest budget, but really make people aware of your arts district are really critical And part of the whole process So that's what I've got

And, you know, happy to answer any questions Maryland State Arts Council: Thank you, Stuart And, and as we pause and rates and see if there any questions for sure I want to thank Stuart for being so generous with his time with Crisfield and for Jen Maryland State Arts Council: To you're spearheading this effort down in Crisfield and my piggybacking Maryland State Arts Council: Thank you for letting me piggyback on all of your great efforts down there

Jennifer Merritt: Well Jennifer Merritt: Well thank you and Stuart for taking the time to come to Crisfield and helping us out Stuart Eisenberg: It was great I loved it So thanks Maryland State Arts Council: So Stuart talked a little bit about how in Prince George's County and they will they market property tax incentives on the state level, we are currently starting to work with a graphic designer who's, one of their first tasks is to Maryland State Arts Council: Look at the A&E districts program and put together some branding for the statewide program, some branding materials that Maryland State Arts Council: The individual districts can use while still retaining their individual identities and also some materials for Maryland State Arts Council: Publicizing and marketing the various incentives, it's easier for the statewide incentives, then for the local incentives but we will talk with them about materials that can be adapted by districts Maryland State Arts Council: For

Maryland State Arts Council: Talking about the details of a property tax incentive, but we will be trying from our department and getting the word out about the A&E district incentives Maryland State Arts Council: More generally so that should be coming within the next six months to eight months and I will be asking for input from A&E district managers as we develop those materials so keep an eye out for those Maryland State Arts Council: But I'd like to open up to discussion and you're able, you should be able to unmute yourself, but if you're if you're not able to, you can raise your hand if you have a question or if you want to offer Maryland State Arts Council: Your experience in either setting up the process, frustrations with the process or Maryland State Arts Council: Questions for any of the presenters, or your ideas for marketing

I'd like to open up the floor to that right now Stuart Eisenberg: Yeah jim epstein: Hi, this is Jim Epstein over in the Wheaton area Wheaton A&E District and jim epstein: You guys have done a great job over in Hyattsville and the whole Gateway jim epstein: Arts District and we're hoping to do some of the same stuff, especially with new development, as well as a lot of vacant storefronts and things like that jim epstein: And so the question of how to market this to landholders and developers, especially developing new facilities jim epstein: You guys seem to have been pretty active and successful with that

Is there an opportunity, you can share some insights there or meet at another time about that? Stuart Eisenberg: Um, both I can, I can talk now a little bit about that Stuart Eisenberg: Principally, our organization is an economic development, small business assistance agency and we kind of inherited managing the A&E district here as a Stuart Eisenberg: oh, these guys will get it done So let's do that And as we did We also got more involved in the arts, public art and the artists

So we developed all the tools for the website Stuart Eisenberg: And then enhance them and and and took them further But a couple of things are important if you're if you're dealing with the business community Stuart Eisenberg: They want to see things in a Certain format You have to have a certain amount of gravity or gravitas

Stuart Eisenberg: You know you want to You want to have materials presented in a way that someone can walk away with something in their hand to think about Stuart Eisenberg: As well as linking them to information that they can go back to, giving them independence from you as well as your, your recruitment But the fundamental the fundamental thing is providing Stuart Eisenberg: A basis for sound investment, you have to make an argument So that is essentially what we're trying to do and not oversell your district Stuart Eisenberg: A lot of times people will come in and you know they're just so positive about things, but it doesn't work out one way or another

And so there's nothing worse than having someone invest and not realize their, their Stuart Eisenberg: Process So making sure you don't over deliver and having market data available as well so that you have an empirical argument to make Stuart Eisenberg: Whether it's their slack demand that needs to be filled and you and you have data on that or that new businesses Stuart Eisenberg: That have come to the district have been successful in a certain amount of time Sometimes testimonial is is the way to do that so Stuart Eisenberg: Networking and and and the more you can get other people involved in your effort, the better Stuart Eisenberg: Because you can't do everything by yourself

So deputized as many people as possible to be your emissary because it's in their interests Also, and because they haven't doozy ask them for your district Stuart Eisenberg: Does that address it on on the level you're looking for now? jim epstein: Yeah, that's great Thank you very much I'd love to follow up at some other point I'm we're also looking

And again, not talking about specific situations, but again, looking at incentives for developers along as a P3 project along with County and or state money Stuart Eisenberg: Well they Stuart Eisenberg: Private sector loves county and state money as long as the strings are minimized

jim epstein: Right jim epstein: That's always the balance Stuart Eisenberg: Right Maryland State Arts Council: Great, thank you Stuart and Thanks Jim for that question to piggyback on on Stuart's talk about deputising people to do the work with you

Maryland State Arts Council: I know that Baltimore City is working on some some incentive workshops and once those are fleshed out I hope that they'll be able to share it and we will share out through MSAC a Maryland State Arts Council: template for those and any materials that they're willing to share Maryland State Arts Council: And MSAC staff is also available to come out and talk about incentives and also to work with you through your processes, advise on your processes for developing the property at the local property tax Maryland State Arts Council: Incentive process So please be in touch with me and me and or Arthur as you as you work through those things Maryland State Arts Council: Any other questions

Maryland State Arts Council: Pause for a few moments, more just to see if anybody Chimes, then Kirby Spencer: Steven This is Kirby Spencer Maryland State Arts Council: Hi Kirby Kirby Spencer: How are you? In Catonsville a new, one of the newbies on board I'm enjoying listening to the experiences of others

And thank you so much for having this Kirby Spencer: Some of the things that I would love And again, I may have not perused all the options that you have provided for the A&E district managing groups, but how does one promote artist housing Kirby Spencer: And not be stepping over that delicate boundary of Kirby Spencer: You know of some of the Kirby Spencer: Classification only type housing, you know, you don't want to be in Kirby Spencer: In competition or not competition, but in you want to be in compliance with anybody is allowed, but yet if you're trying to encourage artists housing It's a very specific group Yeah

Maryland State Arts Council: I hate to call on you again Stuart, but I know that you dealt with this a lot in The Gateway District Stuart Eisenberg: Yeah, so there's a lot of information about this out there on the web You can't, if there are federal tax credits or any public money that's gone into a housing project, you can't Stuart Eisenberg: Artist isn't a class, you can discriminate for Stuart Eisenberg: So you can't reserve the housing for artists Stuart Eisenberg: But what you can do is structure and build the housing in such a way as it's attractive for artists that might not be attractive to Stuart Eisenberg: Other folks It just depends on who you're trying to bring into the district, private property owners and private developments that don't take federally subsidizing or state or county funds to make their housing more affordable have more options for being selective upfront

Stuart Eisenberg: By advertising things as working studios and developing those amenities and marketing those amenities, but Stuart Eisenberg: If you're taking tax credits in any shape or form You have to let folks in and get on the waiting list or income qualified, if this is income qualified housing Stuart Eisenberg: So you don't you don't really have a choice, unless you want to pay lawyers to to defend you Kirby Spencer: That's what I thought But I and I and certainly Kirby Spencer: Discrimination is not anything any of us want Stuart Eisenberg: But Kirby Spencer: When we are trying to attract a particular vibe that is that is helping the economy, the economics of an A&E district in its own way

I just didn't know if anyone else had experienced options that have proven to be successful Stuart Eisenberg: You can also do some other things Stuart Eisenberg: That enabled that live workspaces are very inconvenient for most people to live in, depending on how they're designed Stuart Eisenberg: And so you're going to attract through through design Stuart Eisenberg: Kirby: I See what you're saying Stuart Eisenberg: The people who you're you're seeking to market to and reach, especially if its income qualified artists, you know, the proverbial struggling artists

Stuart Eisenberg: I really think the better option is is ownership than rental, but that's not always available so Stuart Eisenberg: Yeah, there's different there there's different types of Stuart Eisenberg: Programs and I know people, you know, people do say this is artists housing, but there have been there have been legal cases over time Not everybody challenges Every designation Stuart Eisenberg: And if someone gets on your waiting list, you know, and comes in, you know, you can also structure your, your community within the facility to Stuart Eisenberg: You know, work with, you know, everyone in here has to work with the schools or do community service or something like that, you can Stuart Eisenberg: You can structure activities Stuart Eisenberg: Around your, your facility Maryland State Arts Council: And Kirby and anybody else on the call who is interested in this, Marion in the chat shared Maryland State Arts Council: An example in Baltimore city

The City Arts one and two, but becoming subsidized artists housing in the station North arts and entertainment districts and the 410 lofts in Bromo So those are examples Maryland State Arts Council: Income qualified artists housing I'd also point towards Hagerstown, which did an experiment with some housing in downtown and there is an entertainment district and I toured those and Maryland State Arts Council: As Stuart described the living would not be comfortable for everybody There is a big wash basin and then a big open lots of space, but not necessarily something that would be attractive to every, every renter or or home buyer so yeah addressing that by design is often what we see

Kirby Spencer: Terrific suggestions Thank you Maryland State Arts Council: Any other questions related to property tax we are right up on time but Stuart Eisenberg: We have one last question We can try to address it Maryland State Arts Council: Alright, well, I want to respect everybody's time and we will end on time

And a big thank you to Arthur who's been monitoring this for us Maryland State Arts Council: To Jen and Stuart for your expertise and your willingness to jump on as presenters to everybody for joining for your Maryland State Arts Council: Input questions attention And again, you can follow up with Arthur or myself our information is on the website at msacorg and on the site on arts and entertainment districts resources page, there is a list of Maryland State Arts Council: Contact information for district managers So, Stuart and Jen are both on that as well as all of the other district managers, so Maryland State Arts Council: Thank you again for your time and attention

Arthur: Steven we have one more question from Marian Steven: Would a market study be an eligible expense for the technical assistance grant from the State Arts Council? Um, let's talk about that offline Marian if you can shoot me a quick email Maryland State Arts Council: We can talk about that Maryland State Arts Council: My quick answer is probably, and what we'll look at, look at the way we frame that and what exactly you're you're you're looking to do and accomplish with that But I think so

So again, thank you everybody And we will end the webinar right now Stuart Eisenberg: Nice job Steven Thanks Maryland State Arts Council: Thank you, Stuart

Jennifer Merritt: Bye Thank you Maryland State Arts Council: Thank you, Jen Thanks

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