The Baltimore County Council on Monday unanimously approved a 30-year property tax credit that aims to incentivize the development of Anduril Industries’ proposed submarine manufacturing shipyard in Sparrows Point.

But while county officials say the project could bring more than 3,100 permanent jobs to the region, the legislation does not explicitly require Anduril to create a minimum number of jobs, pay specified wages or hire Baltimore County residents to receive the tax break. It also does not establish penalties if the company’s employment projections fall short.

The deal, valued at $210 million over 30 years, will create a 100% personal property tax credit for eligible maritime manufacturing property — machinery, cranes and other equipment — used at the proposed Arsenal-2 facility. The credit would not apply to real property taxes.

The county tax credit is part of a broader package of state and local public incentives estimated at as much as $481 million. The state portion includes existing economic development incentives and proposed funding for the facility and workforce training, some of which still requires approval from Maryland lawmakers.

Under the legislation, Anduril would have to apply for the credit and enter into a reporting agreement with the county before claiming it. The two sides would be required to begin negotiating that agreement within six months of the application’s approval.

Richard Clinch, director of the Jacob France Institute at the University of Baltimore, said the absence of clawback provisions, which can allow governments to recover incentives if companies fail to meet certain conditions, is not unusual at the county level.

“Property tax abatements at the county level typically don’t have clawbacks. The state level [incentive contract] probably will,” Clinch said.

Clifford Rossi, a professor of the practice at the University of Maryland’s Robert H. Smith School of Business, agreed that such arrangements are common, but raised concerns about the county’s ability to hold companies accountable for promised economic benefits.

Rossi said “that is a standard practice for counties and other municipalities. The federal government has a pay for performance on this. It’s harder for Baltimore County to do that verification.”

Approval of the tax break comes less than a month after Anduril announced its plans to invest $3.7 billion into the facility, which would produce submarine components for Virginia-class attack submarines.

County officials say the shipyard would create more than 3,100 permanent jobs and estimate it could generate more than $2 billion annually in regional economic output, a measure of economic activity rather than tax revenue collected by Baltimore County.

Maryland officials estimate that the facility could generate about $312 million in annual wages once fully operational.

Clinch estimated that the project could eventually generate about $30 million annually in state and local tax revenue, including roughly $16 million for Baltimore County.

Concessions more certain

Rossi cautioned that the county’s tax concessions are more certain than the employment projections accompanying them.

“Anduril gets this guaranteed tax relief on day one and the county gets this unguaranteed promise of jobs.”

Clinch, however, viewed the incentives as proportionate to the scale of the project.

“It’s transformative and needed,” Clinch said of the project.

“Maryland doesn’t have a lot of manufacturing left in this space to make these pieces. But given the size of the facility. It’s on the high end of reasonable but [the incentives are] not unreasonable. Baltimore County is not giving away the store here. These are all standard tax abatements.”

A need for the project

The project comes as the Navy struggles to meet its submarine production goals. Although the service aims to produce roughly two Virginia-class submarines annually, production has remained below that level, averaging about 1.1 to 1.2 submarines a year in recent years, according to a January 2026 Congressional Research Service report.

A February 2025 Government Accountability Office report found that workforce and infrastructure challenges had prevented the nation’s shipbuilders from meeting Navy production goals. The report also found that the Defense Department had not fully determined the effectiveness of billions of dollars invested in the shipbuilding industrial base.

An Anduril spokesperson told The Sun on Tuesday that the company is continuing to prepare the Sparrows Point site for construction.

“We’re excited to be building with Baltimore County and look forward to being part of this community. Permitting and land preparation are still actively underway, and we intend to break ground in the next couple of months,” the spokesperson said.

Anduril plans to build the facility at the sprawling Tradepoint Atlantic complex, the former Bethlehem Steel site. In December 2025, the council approved a separate 50-year tax credit for the $1 billion privately operated Sparrows Point Container Terminal at the same complex.

Rossi said competition among jurisdictions to attract major industrial developments can influence the terms of such incentives.

“It becomes a competition of who can give the easiest terms to these companies. It’s sort of a race to the bottom.”

“I think Baltimore County’s responsibility, like any level of government, is to lay the foundation for growth, and I think that’s what we’re doing today,” said Councilman David Marks, a Republican from Upper Falls. “I think this is the right decision and look forward to seeing what the next few years will bring us.”

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