City of Hopewell, VirginiaThe
Virginia Enterprise Zone Program, administered by the
Virginia Department of Housing and Community Development (DHCD),
assists with business development and expansion in specially
targeted areas throughout the state called Enterprise Zones.
The 2005 Virginia General Assembly adopted a new Enterprise program
that is based upon cash grants for new job creation and investment.
There are no longer state income tax credits associated with
the Enterprise program. In addition to the state incentives,
local Enterprise Zone incentives are available as well.
Enterprise Zone Job Creation Grants
For companies creating at least four net new qualifying jobs with health
benefits and paying at least twice the federal minimum wage rate ($5.15 x
2 = $10.30 per hour), a job grant amount of $4,000 is available for each
job over the four threshold jobs. Companies paying 1.75 times the federal
minimum wage rate ($5.15 x 1.75 = $9.01 per hour) are eligible for $2,500
per qualifying job over the threshold amount. Companies with pay rates below
$9.01 per hour are not eligible for the job grant. The grant is paid out
in annual installments of either $500 or $800 per job and is available for
qualifying jobs over the threshold for five years. Qualifying companies may
claim the grant on up to a maximum of 350 jobs.
Please note: Once a job attains the minimum qualifying
wage level (currently $9.01 per hour), the grant is available for that job.
For jobs in the payroll less than one calendar year, a pro-rated amount will
be given to that company for that year, and then the full amount will be
given for that job for each of the remaining years in the company's five-year
period.
Real
Property Investment Grant
Qualified businesses investing in qualifying real property investments**
may receive a cash grant in an amount equal to 30 percent of depreciable
real property improvements for the calendar year the property is placed in
service in a zone. For companies investing $2,000,000 or less in real property
investments, the maximum grant is $125,000. For companies investing over
$2,000,000, the maximum grant is $250,000. Total grant awards may not exceed
the maximums specified above within a five-year period for a specific building
or facility. Investment in rehabilitation/expansion projects must equal $50,000.
New construction projects must invest at least $250,000 in qualified improvements.
**Qualified real property investments include expenditures associated with
(a) any exterior, interior, structural, mechanical or electrical improvements
necessary to construct, expand or rehabilitate a building for commercial,
industrial or mixed use; (b) excavations; (c) grading and paving; (d) installing
driveways; and (e) landscaping or land improvements. Qualified real property
investments shall include, but not be limited to, costs associated with demolition,
carpentry,
sheetrock, plaster, painting,
ceilings, fixtures, doors, windows, fire suppression systems, roofing, flashing,
exterior repair, cleaning and cleanup. Qualified real property investment
shall not include: (a) The cost of acquiring any real property or building;
(b) Other
acquisition costs including: (i)
the cost of furnishings; (ii) any expenditure associated with appraisal,
architectural, engineering, surveying, and interior design fees; (iii) loan
fees, points, or capitalized interest; (iv) legal, accounting, realtor, sales
and marketing, or other professional fees; (v) closing costs, permits, user
fees, zoning fees, impact fees, and inspection fees; (vi) bids, insurance,
signage, utilities, bonding, copying, rent loss, or temporary facilities
incurred during construction; (vii) utility connection or access fees; (viii)
outbuildings; (ix) the cost of any well or septic or sewer system; and (x)
roads.
