IA Statewide Economic Development Agencies

IA Utilities

IA Regional Economic Development Agencies

IA County Economic Development Agencies

IA City Economic Development Agencies

Iowa State Incentives

The Grow Iowa Values Fund (GIVF) is the state’s premier financial assistance program designed to support innovation and job growth. A variety of business development programs are available as included below:

• DIRECT ASSISTANCE TO A COMPANY: Assistance is provided in the form of loans and/or forgivable loans, based in part on job creation, capital investment, the ability to meet certain regional/county wage standards, quality of employment, and economic benefits for the state and local community. Applications are filed by cities, counties or community colleges on behalf of eligible businesses.
• The GROW IOWA VALUES FINANCIAL ASSISTANCE PROGRAM serves as the funding source for projects that are focused on job creation or retention, value-added agriculture and entrepreneurial efforts. This program, combined with Iowa’s nationally recognized business climate, tax incentives and proactive state government make Iowa a great place to do business.
• The DEMONSTRATION FUND provides financial awards up to $150,000 to encourage commercialization activities by small and medium-sized Iowa companies in the advanced manufacturing, biosciences, and information technology industries. The fund is designed to encourage product refinements, market planning and market entry activities of unique products to foster competitive, profitable companies that create high paying jobs and wealth in Iowa.
• Infrastructure component: Designed to financially assist capital-intensive infrastructure projects that create unique opportunities for quality, high-wage jobs and demonstrate a statewide impact. Both Iowa communities and new or existing businesses are eligible for this innovative program. This program may also be used to remediate contaminated sites that have potential development opportunities contingent on the cleanup. Assistance is provided in the form of loans, forgivable loans and cost indemnification agreements.
• The Public Facilities Set-Aside (PFSA) program provides financial assistance to cities with less than 50,000 in population and to counties for public infrastructure improvements that enable businesses to create new job opportunities. Projects that will create manufacturing jobs, add value to Iowa resources and/or increase out-of-state exports will be given priority. Eligible projects include adding or improving sanitary sewer systems, water systems, streets, roads, and storm sewers.

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KS Statewide Economic Development Agencies

KS Utilities

KS Regional Economic Development Agencies

KS County Economic Development Agencies

KS City Economic Development Agencies

Kansas State Incentives

The PROMOTING EMPLOYMENT ACROSS KANSAS (PEAK) program offers qualified companies the ability to retain 95 percent of their payroll withholding tax for up to five to seven years. PEAK is available to new operations in Kansas as well as relocated operations to the state. In 2013, it will be available for qualifying business retention projects as well. Companies need to create at least 10 new jobs within two years in metropolitan areas or five new jobs within two years in all other counties of the state. High-impact projects that create 100 new jobs within two years can retain 95 percent of payroll withholding tax for up to seven to 10 years. The number of years that the withholding tax can be retained depends on how much the annual median or average wage of the jobs at the Kansas worksite will exceed the current county median wage and the discretion of the Secretary of the Kansas Department of Commerce.

The HIGH PERFORMANCE INCENTIVE PROGRAM (HPIP) provides a 10 percent corporate income tax credit on the qualified capital investment of an eligible company. Qualified capital investment can include such items as the purchase or lease of a facility or equipment, remodeling or build-out costs, fixtures, furniture and computers. Equipment transferred to Kansas from out-of-state is also credited at the original acquisition cost. The 10 percent tax credit is awarded to companies that operate an eligible business, pay above-average wages and invest in employee training. The credits can be used to significantly reduce a company’s corporate income tax liability in a given year. Credits must be used within a consecutive 16 year period. The minimum investment threshold to qualify for HPIP is $1.0M for urban counties of Douglas, Johnson, Sedgwick, Shawnee and Wyandotte. For all other counties, the minimum investment threshold is $50,000.

MACHINERY & EQUIPMENT EXPENSING DEDUCTION: Effective January 1, 2012, Kansas taxpayers will be allowed to claim an expense deduction for business machinery and equipment, placed in service in Kansas during the tax year. The one-time deduction is allowed for each qualified purchase of machinery and equipment in the year that it is placed in service. The expensing deduction is representative of the difference between the cost of the item and the present value of the stream of depreciation deductions allowed under normal federal depreciation rules. Any unused expense deduction may be carried forward until fully claimed in future years. If the property is relocated outside Kansas or disposed of before the end of its federal depreciable life, the amount of the tax liability relieved by the deduction may be subject to repayment.

MACHINERY & EQUIPMENT PROPERTY TAX EXEMPTION: Commercial and industrial machinery and equipment acquired by qualified purchase or lease or transferred into the state is exempt from state and local property tax. The exemption pertains to machinery and equipment used in the expansion of an existing facility or the establishment of a new facility. The exemption covers machinery and equipment used in manufacturing or warehousing/distribution, commercial equipment, computers, desks and chairs, copiers and fax machines.

PROPERTY TAX ABATEMENT: Cities or counties may exempt real property from ad valorem taxation. The tax abatement can include all or any portion of the appraised buildings, land and improvements. A total or partial tax abatement may be in effect for up to 10 years after the calendar year in which the business commences its operations. Any property tax abatement is the decision of the city or county.

The RURAL OPPORTUNITY ZONES PROGRAM (ROZ) is designed to reverse dramatic population declines over the past decade in rural areas of Kansas. The program is to spur economic development in and expand job growth in 50 counties around the state. The program has two main incentives:

• A state income tax exemption for up to five years to individuals who move to a ROZs county from outside the state. Individuals must not have lived in Kansas for the past five years, nor have Kansas source income of more than $10,000 per year over the past five years.
• Student loan forgiveness of up to $3,000 per year ($15,000 maximum benefit) for individuals who graduate from an accredited post-secondary institution and move to a ROZs county. The student loan forgiveness portion of the program is a county-state partnership, and counties must opt in to participate.

WIND AND SOLAR BOND FINANCING: This allows for up to $5 million in bond financing per project for eligible wind and solar energy manufacturers. The bonds are paid off from the payroll withholding tax of the new jobs. To qualify, a project must create at least 200 new jobs within five years, pay at least a $32,500 average salary and generate a minimum capital investment of $30 million.

KANSAS ECONOMIC OPPORTUNITY INITIATIVES FUND: The Department of Commerce can provide a zero-percent interest forgivable loan to qualified companies. This loan can offset costs associated with the establishment of a new facility or the expansion of an existing facility. Eligible costs include site improvements, construction, build-out and purchases and relocation of machinery and equipment. The loan is forgiven in 20 percent annual increments over a five-year period based on meeting the job and payroll targets. Approval of funding for this program is based on the number of new jobs created, the level of wages paid to the new employees and the economic impact of the project.

INDUSTRIAL REVENUE BONDS (IRBs): A method of financing up to 100 percent of a growing business’ land, building and equipment. They are securities issued by cities and counties to provide funds for creditworthy companies to acquire land, construct and equip new facilities or remodel and expand existing facilities. IRBs allow fixed-rate financing for the life of the bond for the project.

COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG): Eligible small city and county governments may apply for funds to make water, sewer, rail spur, roadway or other infrastructure improvements designed to assist companies in creating jobs. These funds may also be used by a business to acquire land or buildings, construct or renovate facilities, purchase machinery and equipment or for working capital. Companies can apply for up to $35,000 per job created with a maximum limit of $750,000. At least 51 percent of the jobs created with CDBG funding must be held by individuals who, at the time of hire, meet the low to moderate income guidelines for the county location. Infrastructure funding requires that half of the funding be paid back over a 10-year period at a rate of 2 percent. Financing for working capital, equipment and real property carries a fixed rate equal to four percent or 3 percent below prime, whichever is greater, set on the award date. The term of the loan depends on the type of assets being financed: working capital up to five years, equipment up to 10 years and real property up to 15 years.

PARTNERSHIP FUND: Low-interest state funds are provided to cities and counties for infrastructure improvements that support Kansas’ basic enterprises such as manufacturing and distribution. Eligible projects may include construction, rehabilitation or expansion of public facilities, including roads, streets, highways, water supply and treatment facilities, water distribution lines, wastewater collection lines and related improvements.

KANSAS BIOSCIENCE AUTHORITY (KBA): Commerce works in partnership with the Kansas Bioscience Authority to assist in the expansion and recruitment of bioscience companies. The KBA has direct financing programs and other resources that can be used to recruit new bioscience companies and world-class scholars, fund equipment and lab space for research and facilitate the commercialization of bioscience discoveries.

WORKFORCE DEVELOPMENT PROGRAMS: The Department of Commerce has two programs to offset a company’s training costs. Companies creating new jobs may qualify for KANSAS INDUSTRIAL TRAINING (KIT) assistance. Eligibility for either program depends on the number of jobs created and the corresponding wages. There is also the KANSAS INDUSTRIAL RETRAINING (KIR) PROGRAM to retrain a Kansas company’s existing workforce on new technology or production activities. Projects involving a Kansas Basic Industry—which includes manufacturing, distribution or regional/national service facilities—may qualify for these programs. Both programs offer direct financial assistance to pay a negotiated portion of the costs to train a company’s employees. Companies may apply the assistance toward items such as instructors’ salaries; meals, travel and lodging (including out-of-state or international travel); video development; textbooks and training manuals; supplies and materials; temporary training facilities and curriculum planning and development.

SALES TAX EXEMPTIONS: Those available include:

• Labor services related to original construction
• Remodeling costs, furnishings, furniture, machinery and equipment for qualified projects
• New machinery and equipment for manufacturing and distribution. This also includes pre- and post-production machinery and equipment, including raw material handling, waste storage, water purification and oil cleaning, as well as ancillary property such as gas pipes, electrical wiring and pollution control equipment
• Tangible personal property that becomes an ingredient or component part of a finished product
• Tangible personal property that is immediately consumed in the production process, including electric power, natural gas and water
• Incoming and outgoing interstate telephone or transmission services (WATTS)
• Real and personal property financed with an Industrial Revenue Bond (IRB)

INVENTORY TAX EXEMPTION: All merchant and manufacturers’ inventories are exempt from property taxes.

RESEARCH TAX CREDIT: An income tax credit equal to 6.5 percent of a company’s investment in research and development above an expenditure of the previous three-year period. 25 percent of the allowable annual credit may be claimed in any one year.

KANSAS RETAIL DEALERS INCENTIVE FUND: Created for the payment of incentives to Kansas retail dealers who sell and dispense renewable fuels or biodiesel through a motor fuel pump. This incentive is currently not funded for fiscal years 2011 and 2012, pursuant to the 2010 Senate Bill 527. The provisions of the Kansas Retail Dealers Incentive Fund shall expire on January 1, 2026.

EFFICIENCY KANSAS: A low-cost loan program that helps make energy-efficiency improvements to small businesses. It connects businesses to qualified energy auditors who will pinpoint the uses (and loses) of energy and give a custom plan to make it more energy efficient. It also provides access to low-cost financing through participating lenders or utilities.

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MN Statewide Economic Development Agencies

MN Utilities

MN Regional Economic Development Agencies

MN County Economic Development Agencies

MN City Economic Development Agencies

Minnesota State Incentives

DATA CENTER SALES TAX EXEMPTIONS: Enacted in July 2011, Minnesota created a major tax exemption for data center projects. Qualified data centers will receive a 20-year exemption from sales tax on equipment and energy used in the center (Minnesota state sales tax is 6.875 percent.). To be qualified, the data center must be at least 30,000 square feet of new or substantially renovated space, and represent at least $50 million in construction and equipment costs within 24 months. The incentive takes effect July 1, 2012. Minnesota is also blessed with no personal property or inventory tax. Other benefits in Minnesota are cooler climate to reduce cooling costs, low risk for earthquakes and other natural disasters, a robust fiber network, and reasonably priced and abundant energy.

JOB OPPORTUNITY BUILDING ZONE (JOBZ): Provides local and state tax exemptions to qualified companies that start up or expand in targeted areas of Greater Minnesota. There are 10 job zones comprising more than 29,000 acres in about 325 communities. Each zone includes acres for primarily manufacturing, value-added or high paying service businesses. Benefits are determined by the exact nature of the business expansion, as well as its effective date. JOBZ benefits accrue from the date businesses qualify and continue until December 31, 2015, when the JOBZ program is scheduled to expire. Businesses that startup or expand in a zone or relocate from other states or from elsewhere in Minnesota are eligible for the incentives if they meet certain job and wage goals:

• They must increase employment by a minimum of five jobs or 20 percent (whichever is greater) within the first full year of operations in the zone.

o  They must pay each employee (including benefits not mandated by law) at a level equal to at least 110 percent of the federal poverty level for a family of four.

ANGEL TAX CREDIT: Signed into law on April 1, 2010, it offers incentives to investors or investment funds that put money into startup and emerging companies focused on high technology or new proprietary technology. Funding for years 2012-2014 is set at $12 million per year. To qualify, businesses must meet these general criteria. At minimum they must:

• Be headquartered in Minnesota
• Have a minimum of 51 percent of employees and 51 percent of payroll in Minnesota
• Have fewer than 25 employees
• Pay employees annual wages of at least 175 percent of poverty level
• Pay interns 175 percent of federal minimum wage
• Not have been in operation for more than 10 years
• Not previously have received private equity investments of more than $4 million
• Not have been disqualified from investment under MN Stat. 80 A.50 (b)(3)
• Not have generated more than $4 million in investments that have received an Angel Tax Credit.
• Be certified by DEED before investment is made. The non-refundable certification filing fee is $150

In addition, qualifying businesses must also be engaged in—or committed to engage in—technological innovation in MN. Their primary business activities must include one or more of the following:

• Using proprietary technology to add value to a product, process or service in a qualified high-technology fiel
• Researching or developing a proprietary product, process, or service in a qualified high-technology field
• Researching, developing, or producing a new proprietary technology for use in the fields of: agriculture, tourism, forestry, mining, manufacturing or transportation

STATE SMALL BUSINESS CREDIT INITIATIVE (SSBCI): Uses federal funding to stimulate private-sector lending and improve access to capital for small businesses and manufacturers that are creditworthy but not getting loans they need to expand and create jobs. It allocates up to $15.4 million into four state programs: The Capital Access Program, Emerging Entrepreneurs Fund, Small Business Loan Guarantees and Early Stage Fun

RESEARCH & DEVELOPMENT TAX CREDIT: Individuals involved in partnerships, S-corporations and limited liability companies are allowed to claim the credit against their individual income taxes. This opens up the tax credit to more small and medium-sized businesses. The tax credit for R&D expenditures is10 percent, up to the first $2 million in eligible expenses and 2.5 percent for eligible expenses above $2 million.

MINNESOTA INVESTMENT FUND: Provides grants to help add new workers and retain high-quality jobs on a statewide basis. The focus is on industrial, manufacturing and technology-related industries to increase the local and state tax base and improve economic vitality statewide. Grants are awarded to local units of government (one grant per state fiscal year) who provide loans to assist expanding businesses. Cities, counties, townships and recognized Indian tribal governments are eligible for this fund. All projects must meet minimum criteria for private investment, number of jobs created or retained and wages paid. There is a maximum of $500,000 per grant. At least 50 percent of total project costs must be privately financed through owner equity and other lending sources. Grant terms are for a maximum of 20 years for real estate and a maximum of 10 years for machinery and equipment. Interest rates are negotiated.

SMALL BUSINESS DEVELOPMENT LOAN PROGRAM: Provides loans for business expansions that result in the creation of new jobs. Small business loans up to $5 million are made by the Minnesota Agricultural and Economic Development Board (MAEDB) through the issuance of industrial development bonds. Manufacturing and industrial companies located or intending to locate in Minnesota and meet the federal definition of a small business (generally those with 500 or fewer employees) are eligible.

URBAN INITIATIVE LOAN PROGRAM: Created to support the growth of minority owned and operated businesses and to create jobs in economically distressed areas of the Twin Cities. Grant funds are provided to a network of nonprofit lenders to use for loans to start-up and expanding businesses. Start-up and expansion costs, including normal expenses such as machinery and equipment, inventory and receivables, working capital, new construction, renovation and site acquisition are eligible for the program. Businesses eligible for loans include technologically innovative industries, value-added manufacturing and information industries. Project must demonstrate potential to create jobs for low-income people; be unable to obtain sufficient capital from traditional private lenders; and demonstrate the potential to succeed. Businesses must be located in Minneapolis, St. Paul, Bloomington, Brooklyn Center, Brooklyn Park, Burnsville, Columbia Heights, Coates, Coon Rapids, Fridley, Lauderdale, Lexington, Mendota, Miesville, New Germany, New Brighton, New Hope, Newport, Richfield, Spring Lake Park, South St. Paul and West St. Paul. Micro enterprises, including retail businesses, may apply for up to $25,000. Businesses that are seeking more than $25,000 will be required to find private financing to match the state’s investment. The maximum Urban Initiative investment in any one business is $150,000.

INDIAN BUSINESS LOAN PROGRAM: Supports the development of Indian-owned and operated businesses and promotes economic opportunities for Indian people throughout the state. The Minnesota Chippewa Tribe has authority to use IBLP funds to make loans to businesses owned and operated by an enrolled member of its six participating bands–Bois Forte, Fond du Lac, Grand Portage, Leech Lake, Mille Lacs and White Earth. Applicants must be enrolled members of a federally recognized Minnesota-based band or tribe. Businesses must be wholly owned by an enrolled member and can be located anywhere in the state, although the bulk of the loans are made to businesses on a reservation. Loan proceeds may cover start-up and expansion costs. Loans may not exceed 75 percent of the projects costs or the balance of the funds available to any one tribe. Owners must provide a portion of the financing needed to undertake the project. The amount varies between 5 percent and 10 percent, depending upon the requirements of each band or tribe.

BORDER CITIES ENTERPRISE ZONE PROGRAM: Provides business tax credits (property tax credits, debt financing credit on new construction, sales tax credit on construction equipment and materials, and new or existing employee credits) to qualifying businesses that are the source of investment, development and job creation or retention in the Border-Cities Enterprise Zone cities of Breckenridge, Dilworth, East Grand Forks, Moorhead and Ortonville

SEED CAPITAL INVESTMENT CREDIT PROGRAM: Provides tax incentives for investing in innovative business located in the Minnesota border cities of Breckenridge, Dilworth, East Grand Forks, Moorhead and Ortonville. Investors may receive a 45 percent tax credit on their investment, up to $112,500 per year. The credit is non-refundable and may be carried forward up to four years.

TOURISM BUSINESS SEPTIC TANK REPLACEMENT: Makes low-interest financing available to existing tourism-related businesses that provide overnight lodging and need to replace a failed septic system. Participation loans in cooperation with financial institutions can be made for up to 50 percent of the total cost of the project.

SBIR PROGRAM: Provides federal grants for small companies in the critical startup and development stages, helping them to compete with larger, more established companies. Each year, 11 federal departments and agencies set aside a portion of their research and development funds for award to small business. To be eligible, companies must be at least 51-percent American-owned, independently operated and located in the United States. Other requirements include:

• Perform all work in the United States.
• Be for-profit.
• Be the primary employer of the lead researcher at the time of award. That researcher may not be employed full time by another institution or company.
• Perform the majority of work themselves, rather than through consultants or subcontractors.
• Have 500 employees or fewer.

SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM (STTR): Provides federal grants to encourage partnerships between businesses with ideas for new technologies and products and the nonprofit R&D institutions that can bring those products to market. Each year, five federal departments and agencies are required by STTR to reserve a portion of their R&D funds for award to small business/nonprofit research institution partnerships. Both small businesses and nonprofit research institutions must meet certain requirements. Small businesses must be American-owned and independently operated, be for-profit and have 500 employees or fewer. The principal researcher on the project need not be employed by small business.

Nonprofit research institutions must be located in the U.S. and must also be a nonprofit college or university, a domestic nonprofit research organization, or a federally funded research-and-development center (FFRDC). Unlike the restrictions placed on participating businesses, there are no limits on the numbers of employees a nonprofit research institution may have.

MINNESOTA JOBS SKILLS PARTERNSHIP PROGRAM: Grants of up to $400,000 are awarded to educational institutions that partner with businesses to develop new-job training or retraining for existing employees. All training projects pair at least one public or private accredited Minnesota educational institution and one business. Funds may be used for training-related costs or educational infrastructure improvements necessary to support businesses located or intending to locate in Minnesota. A cash or in-kind contribution from the contributing business must match program funds on at least a one-to-one ratio.

TAX INCREMENT FINANCING (TIF): Uses the increased property taxes that a new real estate development generates to finance up-front costs of the development. The city, county or development authority uses TIF to pay qualifying costs–land acquisition, site preparation and public infrastructure, for instance–incurred for the project.

TAX ABATEMENT: Cities, counties and school districts may use tax abatement to help finance certain economically beneficial projects. Property taxes are forgiven for a period of time to allow the project to cash flow. Or the taxes are captured for a period of time and an up-front payment is made by the political subdivision to help the project cover start up costs. At least 50 percent of the payroll of the operations of the business that qualify must be for employees engaged in one of the following lines of business or any combination of them: Manufacturing, Agricultural processing, Mining, R&D, Warehousing, Qualified high technology

LOCAL ENERGY IMPROVEMENTS FINANCING PROGRAM: Provides low-interest loans to building owners who want to make their properties more energy-efficient. Open to qualified residential, commercial and industrial property owners in Minnesota, the program is funded through revenue bonds issued by participating local governments. Building owners pay back the loans through a special tax assessment that may not exceed 20 years. The energy improvements can be any permanent change to a building that leads to a net reduction in energy consumption without altering the principal source of energy.

GROWTH ACCELERATION PROGRAM: Provides consulting services to help small manufacturers that employ up to 100 workers become more efficient, more competitive and more likely to thrive and grow.

GAP provides grants of up to $50,000, which are matched dollar-for-dollar by companies. The grants are typically used to analyze and improve business and manufacturing processes.

FOREIGN TRADE ZONES: Commerce sites (industrial sites, buildings) set up in or near U.S. Customs ports of entry where merchandise is considered legally outside U.S. Customs territory. The zones are operated as public utilities by states, port authorities, other political groups or corporations charted by the state. Companies can use foreign trade zones to reduce duty payments, streamline supply chain costs and improve competitive position in domestic and foreign markets.

FEDERAL RURAL DEVELOPMENT FINANCING

• RENEWABLE ENERGY PROGRAM: Loans, loan guarantees and grants are available to help agricultural producers and rural small business purchase renewable energy systems and make energy efficiency improvements. Rural is defined as an area of less than 50,000 in population or its immediately adjacent incorporated communities.

• VALUE-ADDED PRODUCER GRANTS: Help producers expand their customer base by entering into emerging markets for their products or commodities and ensure that a greater portion of the revenues derived from the value-added activity is available to the producer. The maximum allowable grant amount is $100,000 for planning grants and $150,000 for working capital. Grant recipients must provide 1-to-1 matching funds and projects must be completed within 1 year. Independent producers, farmer-owned cooperatives, agricultural producer groups and majority-controlled producer-based groups are eligible to apply. Four categories are considered value-added under this program.

o   Ventures in which agricultural producers add value to their products through changing the physical state or form of the product (processing wheat into flour, corn into ethanol, slaughtering livestock).

o   Producing products in a manner that enhances its value (organic).

o   Physical segregation of an agricultural commodity or product in a manner that results in the enhancement of the value of that product.

o   Any agricultural commodity or product that is used to produce renewable energy on a farm or ranch (methane digesters, wind turbines).

• BUSINESS & INDUSTRY LOAN GUARANTEE PROGRAM: Loan guarantees with an upper limit of $10 million. Some high-priority projects may be guaranteed up to $25 million by the administrator in Washington. Most business purposes are eligible, e.g. building and equipment purchase or development, working capital (no lines of credit); aquaculture; commercial nurseries; tourist and recreation facilities (except golf courses); hotels and motels; community facility-type projects; facilities for lease to private businesses; and housing development sites. Eligible borrowers may generally be an individual, cooperative, corporation, partnership, non-profit corporation, Indian tribes or public body. A minimum of 20 percent tangible balance sheet equity is required on a new business and 10 percent on an existing business.

• INTERMEDIARY RELENDING PROGRAM: Loan provided to an entity (intermediary) to establish a revolving loan fund to re-lend to eligible ultimate recipients (businesses) at reasonable rates and terms. Eligible intermediaries are private non-profit corporations, any state or local government, an Indian tribe or a cooperative. IRP funds can be used to finance business facilities and community development projects in rural areas, innovative projects, land, building construction or repair, equipment, working capital, interest, feasibility studies and fees for professional services. Ultimate recipients must be located in a rural area of fewer than 25,000 in population.

• RURAL ECONOMIC DEVELOPMENT LOAN & GRANT PROGRAM: Provides financing to develop projects that will result in a sustainable increase in economic productivity, job creation and incomes in rural areas. Eligible borrowers (or grantees) of this program are current or prepaid RUS electric and telephone borrowers. Funds are either a zero-interest loan or a grant to the utility, which in turn is re-lent as a zero-interest loan to the eligible business for a specific project. Grant funds must be matched 20 percent up-front by the borrower utility company. Projects may include business start-ups and expansion, community development, incubator projects, medical and training projects and feasibility studies.

• RURAL BUSINESS ENTERPRISE GRANT PROGRAM: Applicants are public bodies, non-profit associations and Indian tribes. The purpose is to assist in financing and developing small and emerging private businesses. The grant cannot be passed through to the business. Funds can be used for a revolving loan program to provide financing to businesses that meet all of the following requirements:

o  50 or fewer new employees
o  Less than $1 million in projected gross revenue
o  Uses new processes
o  Uses technological innovations and commercialization of new products that can be produced in rural areas

• RURAL BUSINESS OPPORTUNITY GRANT PROGRAM: May be used to assist in the economic development of rural areas by providing technical assistance for business development and economic development planning. Grants may be made to public bodies, nonprofit corporations, Indian tribes on federal or state reservations and other federally recognized tribal groups, and cooperatives with members that are primarily rural residents and that conduct activities for the mutual benefit of the members. Applicants must have sufficient financial strength and expertise in activities proposed in the application to ensure accomplishment of the described activities and objectives. Grant requests are limited to $50,000 per state and may be used to:

o  Identify and analyze business opportunities that will use local rural materials or human resources. This includes opportunities in export markets, as well as feasibility and business plan studies.
o  Identify, train and provide technical assistance to existing or prospective rural entrepreneurs and managers.
o  Establish business support centers and otherwise assist in the creation of new rural businesses.
o  Conduct local community or multi-county economic development planning.
o  Establish centers for training, technology and trade that will train rural businesses in the utilization of interactive communications technologies to develop international trade opportunities and markets.
o  Conduct leadership development training of existing or prospective rural entrepreneurs and managers.
o  Pay reasonable fees and charges for professional services necessary to conduct the technical assistance, training or planning functions.

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MO Statewide Economic Development Agencies

MO Utilities

MO Regional Economic Development Agencies

MO County Economic Development Agencies

MO City Economic Development Agencies

Missouri State Incentives

LOAN GUARANTEE FEE TAX CREDIT PROGRAM: Provides state tax credits to an eligible small business—defined in Section 44 of the IRS code, must (in the prior tax year) have gross receipts of less than $1 million; or if more than $1 million, less than 30 full time employees—for the amount of a guarantee fee paid to either the U.S. Small Business Administration or the U.S. Department of Agriculture for a small business loan. There is no limit on the amount per business or total amount distributed annually.

ENHANCED ENTERPRISE ZONE: Provides state tax credits to new or expanding businesses in a Missouri Enhanced Enterprise Zone. Can be applied to Ch. 143 Income tax, excluding withholding tax and can only be applied to tax liability for the year in which they were earned. Tax credits will be based on the state economic benefit, supported by the number of new jobs, wages and new capital investment that the project will create. Tax credits issued under this program are limited to $24,000,000 annually.

2010 AUTOMOTOVE MANUFACTURING JOBS ACT: Allows qualified manufacturing facilities or suppliers that bring next-generation production lines to Missouri to retain withholding taxes typically remitted to the state.

ACTION FUND LOAN: Provides a loan to certain types of for-profit companies that need funds for start-up or expansion and have exhausted other sources. Projects can only be in a “non-entitlement” area—a city under 50,000 in population or a county under 200,000 in population.

BROWNFIELD REDEVELOPMENT PROGRAM: Provides financial incentives for the redevelopment of commercial/industrial sites that are contaminated with hazardous substances and have been abandoned or underutilized for at least three years.

COMMUNITY DEVELOPMENT BLOCK GRANT: Offers grants to small MO communities to improve local facilities, address critical health and safety concerns and develop a greater capacity for growth. Projects can range from housing and street repairs to industrial loans and job training.

NEW JOBS TRAINING PROGRAM: Provides assistance in reducing the cost associated with expanding a workforce or locating a new facility in the state of Missouri through training services—training customized to the specific needs of the industry and general occupational skill training. Businesses with a sound credit rating currently located in or locating to MO that are creating a substantial number of new jobs in Missouri by locating a new facility or expanding an existing workforce in the state.

JOB RETENTION TRAINING PROGRAM: Provides assistance in reducing the cost associated with retraining an existing workforce for the purpose of retaining jobs in the state of Missouri through training services—training designed for the specific needs of the industry and general occupational skill training. Businesses with a sound credit rating currently located in Missouri that have retained at that site the level of employment for at least one year, and a minimum of 100 employees for two consecutive calendar years preceding the year in which the application for the program was made. In addition, the business must make a capital investment of at least one million dollars to acquire long-term assets.

URBAN ENTERPRISE LOAN: The Missouri Department of Economic Development (DED) contracts for the administration of a micro-lending program to assist Missouri’s small business owners with the creation, expansion and retention of their business enterprise, located in the St. Louis and Kansas City urban areas. The loan amount cannot exceed 50 percent of the borrower’s total financial need. Loans range from a minimum of $10,000 to a maximum of $100,000 per business. Funds may be used to:

• Start a new business
• Purchase business equipment, inventory, working capital, acquisition of business assets or other expansion purposes of an existing small business
• Provide an equity match for leveraging a commercial loan
• Secure lines of credit or gap financing from a conventional commercial lender

SMALL BUSINESS INCUBATOR TAX CREDIT: Generates private funds to be used to establish a “protective business environment” (incubator) in which a number of small businesses can collectively operate, fostering growth and development during a business’ start-up period. The overall maximum amount of tax credits that can be authorized under this program in any one calendar year is $500,000. This 50 percent tax credit can be applied to:

• Ch. 143 – Income tax, excluding withholding tax
• Ch. 147 – Corporate franchise tax
• Ch. 148 – Bank Tax, Insurance Premium Tax, Other Financial Institution Tax

NEW MARKETS TAX CREDIT PROGRAM (NMTC): Provides state and federal tax credits to investors that make investments into approved funds, which will make investments in eligible projects located in low income census tracks in Missouri. This program does not provide tax credits directly to businesses. Eligible businesses interested in obtaining funding should contact the approved “Community Development Entities.”

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NE Statewide Economic Development Agencies

NE Utilities

NE Regional Economic Development Agencies

NE County Economic Development Agencies

NE City Economic Development Agencies

Nebraska State Incentives

The four-part TALENT & INNOVATION INITIATIVE (TI2) was developed to enhance momentum in Nebraska’s fastest growing industries and others positioned to integrate new technologies:

• Nebraska Internship Program is a partnership with Nebraska businesses to create new, paid internship opportunities for college and university students. The program will create opportunities for 500 to 750 juniors and seniors studying at four-year institutions or students in their second year at a Nebraska community college to gain job experience. Awards will be made on a first-come, first-serve basis to companies creating new internship opportunities, which are capped at 10 per business. Internships will pay at least minimum wage and range from 12 week to year-long programs. Grant amounts are lesser of 40 percent of reimbursable costs or up to $3,500 in non-distressed areas, and lesser of 60 percent of reimbursable costs or up to $5,000 in distressed areas. Nebraska Internship took effect on June 1.
• Business Innovation Act is intended to help businesses develop new technologies to enhance quality job opportunities in the state. It will provide competitive grants for research at Nebraska institutions, new product development and testing, and help expand small business and entrepreneur outreach efforts. It will expand grant opportunities within targeted industries to help businesses providing matching funds with prototype development, commercialization and applied research in the state, and provide assistance for microenterprise projects. The Business Innovation Act takes effect Oct. 1.
• Site & Building Development Fund is intended to help increase industrial and commercial sites available and ready for business development. Communities will provide matching funds toward projects that can involve demolition, new construction and rehabilitation. State funding will be focused on land and infrastructure costs with 40 percent of funding available to non-metro areas.
• Angel Investment Tax Credit encourages investment in high-tech and other startup enterprises in Nebraska by providing refundable state income tax credits to qualified investors investing in qualified early-stage companies. Capped at $3 million annually, the program requires a minimum investment of $25,000 for individuals and $50,000 for investment funds. Eligible small businesses must have fewer than 25 employees, with the majority based in the state.

The NEBRASKA PROGRESS LOAN FUND (NPLF) will be available for permanent loans to qualifying small businesses, generally, representing existing and startup businesses. The minimum loan to any one business will be $50,000, with a maximum of $2 million. NPLF can also be provided for interim loans to qualifying small businesses for a term not to exceed three years. An interim loan maximum amount is $5 million. Loan terms will be negotiated on a case-by-case basis with a typical loan interest rate ranging from 0 percent to 4 percent. More favorable terms for the business will be a consideration for businesses located in census tracts or counties considered severely distressed. Principal and interest payments may be deferred for three years, with periodic interest payments due until loan maturity.

The NEBRASKA PROGRESS SEED FUND (NPSF) is designed to accelerate private investment in Nebraska-based start-up companies and increase overall investment impact. Through NPSF, Invest Nebraska Corporation will award seed capital funds that match private angel fund investments. The seed capital may be used by the start-up company for advanced intellectual property development and evaluation, including in-depth analysis of market potential, conducting competitive analysis, advanced proof of concept work for scientific discovery, advanced prototype design and development, research and development needed to attract venture capital financing, hiring key personnel, and related activities.

The NEBRASKA ADVANTAGE ACT contains five tiers of benefits:

•  Tier 1: Nebraska Small Business Advantage—Businesses that invest $1 million and create 10 new jobs are eligible for a refund of half of the sales tax paid for qualified property purchases at the project, the full sliding scale wage credit of 3 percent to 6 percent depending on wage level, and a 3 percent investment tax credit. This tier is available to manufacturers, research and development or testing businesses, and listed technology related services where at least 75 percent of the sales and licensing are to out-of-state customers or to the federal government.

• Tier 2: Businesses that invest $3 million and create 30 new jobs qualify for sales tax refunds for capital purchases at the project, the sliding scale wage credit, and a 10 percent investment credit.

• Tier 3: Jobs-only tier—Businesses that create 30 new jobs can receive the sliding scale wage credit. No capital investment is required to qualify.

• Tier 4: Businesses that invest $10 million and create 100 new jobs receive a personal property tax exemption for turbine-powered aircraft, mainframe computers, agricultural product processing machinery, and personal property used in a distribution facility for up to 10 years. This is in addition to qualifying for the sales tax refund, jobs credit, and the investment credit.

• Tier 5: Investment-only tier. This requires $30 million in new investment. Companies receive a refund of sales taxes paid on eligible property with the project.

NEBRASKA SUPER ADVANTAGE: Specifically rewards all non-retail companies that create higher-paying jobs. To qualify, the new jobs must pay at least 150 percent of the state average wage, or 200 percent of the county average, whichever is greater. Companies that create 75 new jobs and make a $10-million capital investment—or 50 new jobs and a $100-million investment—can receive a sales and use tax refund on capital purchases; a 10 percent wage credit on new employee compensation; a 15 percent investment tax credit; and a 10-year exemption on all personal property.

The INVEST NEBRASKA ACT allows companies to qualify for wage benefit credits. These credits may be used against withholding tax liability, for funding employee programs and for offsetting a company’s income taxes. A company has up to seven years to earn these credits. Upon attainment, the company has up to 10 years to earn and use the credits. After that period, unused credits can be carried over and used for an additional eight years.

The CUSTOMIZED JOB TRAINING PROGRAM provides training assistance on projects that offer an opportunity for economic development in Nebraska. Use of the funds is limited to eligible companies and eligible training projects.

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ND Statewide Economic Development Agencies

ND Utilities

ND Regional Economic Development Agencies

ND County Economic Development Agencies

ND City Economic Development Agencies

North Dakota State Incentives

PROPERTY TAX EXEMPTION: Any new or expanding business project may be granted a property tax exemption for up to five years. All buildings, structures or improvements used in, or necessary to, the operation of the project qualify. The structure might be the project’s buildings or the project’s quarters within a larger building. Land does not qualify for an exemption. Two extensions are available:

• Agricultural processors may be granted a partial or full exemption for up to five additional years.
• A project located on property leased from a government entity qualifies for an exemption for up to five additional years upon annual application by the project operator.

In addition to, or instead of, an exemption, local governments and any project operator may negotiate payments in lieu of property tax for a period of up to 20 years from the date project operations begin.

WIND TURBINE ELECTRIC GENERATION PROPERTY TAX REDUCTION: A property tax reduction applies to a centrally assessed wind turbine electric generation unit—a unit that produces electric power for public use—with a nameplate generation capacity of 100 kilowatts or more. For an eligible wind turbine on which construction is completed before January 1, 2015, the taxable value is calculated at 3 percent of assessed value instead of at 10 percent which applies to other centrally assessed property. The taxable value is calculated at 1.5 percent of assessed value if:

• construction of the wind turbine is completed after June 30, 2006, and before January 1, 2015, or
• a purchased power agreement was executed after April 30, 2005, and before January 1, 2006, and the construction of the wind turbine was completed after April 30, 2005, and before July 1, 2006.

SALES TAX EXEMPTIONS

• AGRICULTURAL COMMODITY PROCESSING PLANT CONSTRUCTION MATERIALS: Construction materials used to construct an agricultural commodity processing facility are exempt from sales and use taxes.COAL MINE MACHINERY OR EQUIPMENT: A sales and use tax exemption may be granted for machinery or equipment used to produce coal from a new mine in North Dakota. The exemption for each new mine is limited to the first $5 million of sales and use tax paid. The exemption extends to replacement machinery or equipment if the capitalized investment in the new mine exceeds $20 million.
• COMPUTER & TELECOMMUNICATIONS EQUIPMENT: For primary sector businesses other than manufacturers and recyclers, a sales and use tax exemption is allowed for purchases of computer and telecommunications equipment. To qualify, the equipment must be an integral part of a new primary sector business or create an economic expansion of an existing business, and the primary sector business must be certified by the Department of Commerce Division of Economic Development and Finance. The exemption does not extend to the purchase of replacement equipment.
• ELECTRICAL GENERATING FACILITIES—COAL-POWERED: An exemption may be granted for purchasing building materials, production equipment and other tangible personal property used in the construction or expansion of coal-powered electrical generating facilities. To qualify, the facility must convert beneficiated coal or coal from its natural form into electrical power and have at least one single electrical generation unit with a capacity of 50,000 kilowatts or more.
• ELECTRICAL GENERATING FACILITIES—WIND-POWERED: An exemption is allowed for purchasing building materials, production equipment, and other tangible personal property used in the construction or expansion of wind-powered electrical generating facilities between July 2001 and January 2015. To be eligible, a facility must have at least one single electrical energy generation unit with a nameplate capacity of 100 kilowatts or more.
• ELECTRICAL GENERATING FACILITIES—OTHER: An exemption may be granted for purchasing building materials, production equipment and other tangible personal property used in the construction or expansion of an electrical generating facility other than a coal- or wind-powered facility. To qualify, the facility must produce electricity for resale or for consumption in a business activity and have at least one single electrical generation unit with a capacity of 100 kilowatts or more.
• GAS PROCESSING FACILITIES: An exemption may be granted for purchasing building materials, equipment and other tangible personal property used in the expansion or construction of a gas processing facility. Also, tangible personal property used to construct or expand a system to compress, process or gather gas recovered from an oil or gas well in ND may qualify for an exemption. In addition, purchases of machinery, equipment and related facilities for environmental upgrades that exceed $100,000 and that reduce emissions, increase efficiency or enhance reliability of equipment may also qualify for an exemption.
• MANUFACTURING, AGRICULTURAL OR RECYCLING EQUIPMENT: A new or expanding plant may exempt machinery or equipment from sales and use taxes if it is used primarily for manufacturing or agricultural processing, or used solely for recycling. The expansion must increase production volume, employment or the types of products that can be manufactured or processed.
• OIL REFINERIES: An exemption may be granted for building materials, equipment and other tangible personal property used to expand or construct an oil refinery in North Dakota. To qualify, the facility must have a nameplate capacity of processing at least 5,000 barrels of oil per day. In addition, purchases for environmental upgrades that exceed $100,000 and that reduce emissions, increase efficiency or enhance reliability of equipment may also qualify for an exemption.
• TELECOMMUNICATIONS INFRASTRUCTURE: An exemption may be granted through December 31, 2012 for purchasing tangible personal property used to construct or expand telecommunications service infrastructure within the state. To qualify, the property must be incorporated into a telecommunications service infrastructure owned by a telecommunications company.
• BIODIESEL EQUIPMENT: The sale of equipment not installed by the seller to a facility licensed under N.D.C.C. § 57-43.2-05 to enable the facility to sell diesel fuel containing at least 2 percent biodiesel fuel or green diesel fuel by volume is exempt from sales tax.
• CARBON DIOXIDE FOR ENHANCED OIL & GAS RECOVERY: The sale of carbon dioxide to be used for enhanced recovery of oil or natural gas is exempt from sales and use tax.
• HYDROGEN GENERATION FACILITY: Sales of hydrogen used to power an internal combustion engine or fuel cell are exempt from sales tax. Equipment used directly and exclusively in the production and storage of this hydrogen by a hydrogen generation facility is also exempt from sales tax.

INCOME TAX EXEMPTION: A primary sector or tourism business may qualify for an income tax exemption for up to five years. “Primary sector” refers to a business that adds value to a product, process or service that produces new wealth in ND. Eligibility is limited to a new business or existing business that expands its operations in the state. A business is not eligible for the exemption if it has received a property tax exemption under tax increment financing; there is an outstanding recorded lien for delinquent property, income, sales or use taxes against the business; or the exemption fosters unfair competition or endangers existing business.

AGRICULTURAL COMMODITY PROCESSING FACILITY INVESTMENT CREDIT: An income tax credit may be allowed for investing in an agricultural commodity processing facility—a livestock feeding, handling, milking or holding operation that uses as part of its operation a by-product produced at a biofuels production facility—in ND certified by the Dept. of Commerce Division of Economic Development and Finance (EDF). An investment may consist of a direct cash payment, a transfer of a fee simple interest in ND real property or a direct transfer of cash from a retirement plan for which the investor controls where the plan’s assets are invested. The credit is equal to 30 percent of the investment. No more than $50,000 of the credit may be used in any year. An unused credit may be carried forward up to ten years. A taxpayer is allowed no more than $250,000 in credits for all years.

ANGEL FUND INVESTMENT CREDIT: An income tax credit is allowed for investing in an angel fund in ND certified by the Department of Commerce EDF. The credit is equal to 45 percent of the investment, up to a maximum credit of $45,000 per year. An unused credit may be carried forward up to seven tax years. For credits based on investments made on or after January 1, 2011, a taxpayer is allowed no more than $150,000.

AUTOMATION CREDIT: Allowed only for the 2013, 2014 and 2015 tax years, it is an income tax credit for purchasing machinery and equipment for the purposes of automating a manufacturing process in ND. The credit is equal to 20 percent of the cost of the machinery and equipment approved by the Department of Commerce EDF. The business must be certified by EDF as a primary sector business to be eligible for the credit. An unused credit may be carried forward up to five tax years. In the case of a passthrough entity, such as a partnership or S corporation, the credit is passed through to its owners in proportion to their ownership interests. Total credits are limited to $2 million in any calendar year.

RESEARCH EXPENSE CREDIT: An income tax credit for conducting research in North Dakota. The credit is equal to a percentage of the excess of qualified research expenses in ND over the base amount in North Dakota.

The applicable percentage is 25 percent for the first $100,000 of excess expenses in a tax year. For excess expenses over $100,000 in a year, the applicable percentage for tax years 2007 through 2016 is:

• 20 percent, if qualified research in North Dakota first begins in 2007 through 2010, or
• 7.5 percent for 2007, 11 percent for 2008, 14.5 percent for 2009, and 18 percent for 2010 through 2016, if qualified research in North Dakota began before 2007, or
• 8%, if qualified research in North Dakota first begins after 2010.

For tax years after 2016, the applicable percentage for excess expenses over $100,000 in a year is 8 percent for all taxpayers, regardless of when qualified research first begins.

SEED CAPITAL INVESTMENT CREDIT: An income tax credit for investing in a business certified by the Department of Commerce EDF. The credit is equal to 45 percent of the investment. No more than $112,500 of the credit may be used in any year. An unused credit may be carried forward up to four tax years. Only the first $500,000 of eligible investments in the business are eligible for the tax credit. The total amount of tax credits allowed for investments made in all certified businesses in any calendar year is limited to $3.5 million.

WAGE & SALARY CREDIT: A corporation doing business in North Dakota for the first time is allowed an income tax credit if it did not receive a property or income tax exemption under N.D.C.C. ch. 40-57.1; was not created from a reorganization or acquisition of an existing ND business; and is engaged in assembling, fabricating, manufacturing, mixing or processing of an agricultural, mineral or manufactured product. The credit is equal to:

• 1 percent of wages and salaries paid during the tax year for each of the first three tax years of operation, and
• ½ percent of wages and salaries paid during the tax year for the fourth and fifth tax years.

WORKFORCE RECRUITMENT CREDIT: If extraordinary recruitment methods are used to hire employees for hard-to-fill positions in ND, an income tax credit equal to 5 percent of the compensation paid during the first 12 consecutive months to the employee hired is allowed in the first tax year following the tax year in which the employee completes the 12 consecutive month employment period. Unused credit may be carried forward up to four tax years. To qualify, an employer must pay an annual salary that is at least 125 percent of North Dakota’s average wage and must have employed all of the following recruitment methods for at least six months to fill a position for which the credit is claimed:

1. Contracted with a professional recruiter for a fee;
2. Advertised in a professional trade journal, magazine or publication directed at the trade or profession;
3. Provided employment information on a web site for a fee; and
4. Paid a signing bonus, moving expenses or atypical fringe benefits.

In addition, if an employer claims the credit, the employee hired in the hard-to-fill position is allowed a deduction for the signing bonus, moving expenses, or atypical fringe benefits paid by the employer that are included in the employee’s federal taxable income.

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SD Statewide Economic Development Agencies

SD Utilities

SD Regional Economic Development Agencies

SD County Economic Development Agencies

SD City Economic Development Agencies

South Dakota State Incentives

The ETHANOL INCENTIVE BILL (SB196) passed during the 2011 legislative session. Through a partnership with the ethanol industry, this legislation repurposes funding to secure additional capital for the Revolving Economic Development Initiative (REDI) Fund. The REDI Fund is one of South Dakota’s primary economic development financing tools. In addition, through an incentive program created by SB196, $3.5 million in funding will be provided to encourage additional ethanol consumption and blender pump installation.

AGRICULTURAL PROCESSING AND EXPORT (APEX): In 2011, the legislature reduced the interest rate on the APEX loan program to 3percent.

MICROLOAN EXPRESS PROGRAM: The GOED recently introduced the MicroLOAN express program which streamlines the MicroLOAN application and approval process.

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