Do you own residential or commercial property within Laurel’s Downtown Development District? You really can’t afford not to invest in it, given all the incentives now on the table.

Sussex County Council this week voted to sweeten the pot for towns such as Laurel with Downtown Development District designations. The county will set up a local incentive program that will complement the state DDD initiative and its rebates of up to 20 percent of construction costs for qualifying projects.

The purpose of the DDD program is to redevelop Delaware’s distressed commercial business districts by providing incentives that will drive private investment in the core of towns and cities.

ddd_logoSussex County will join the effort, providing a 50 percent match, up to $10,000, to any state grant for eligible, approved projects in the designated Sussex districts. The County will set aside $100,000 in funding from realty transfer tax reserves for the grants.

“Economic development is everyone’s business: the State, the County, and the towns,” County Council President Mike Vincent said. “Sussex County needs to be at the table with our partners to help leverage those private dollars that invest in our communities and make them stronger.”

So what does that mean if you own property within Laurel’s Downtown Development District?

  • State rebates of up to 20 percent of qualified construction costs for small projects (under $250,000)
  • Now, a county match of up to 50 percent of the state grant (maximum $10,000)
  • No Town property taxes on improvements for five years from the date of the Certificate of Occupancy
  • Because the DDD is in Laurel’s Historic District, you can take Delaware’s Historic Tax Credit for preserving or rehabilitating a historic building.

The amount of the tax credit is equal to a percentage of the cost of the rehabilitation:

  • 20% for income-producing (depreciable) historic buildings
    [which increases to 30% when a project qualifies for the Delaware State Housing Authority’s low income tax credits]
  • 30 % for all other historic buildings [owner-occupied, residential buildings; non-profit-owned buildings and church-owned buildings]

Tax credits awarded to a project can be applied to against the applicant’s state income tax, or can be transferred, sold or assigned to any person or corporation with one with Delaware income tax liability, or to banks to be applied against their franchise tax liability. Applications for owner-occupied residential properties are limited to being awarded a maximum of $20,000 every 24 months.

For more information about Laurel’s Downtown Development District, visit this page.

Questions? Contact Lee Ann Walling, cedarcreekplanners@comcast.net