Smart Incentives readers have asked for more articles on new incentives. Here are summaries of two new incentive programs in Virginia and Montgomery County, Maryland.
Incentives for distressed areas (Virginia)
Legislation passed earlier this year provides a tax exemption on the state’s corporate income tax for new companies locating in one of 50 distressed counties or cities in Virginia. Companies must invest at least $5 million and create 10 jobs paying 150% or more of the minimum wage OR create at least 50 jobs paying 150% or more of the minimum wage. Only companies that did not previously have either property or payroll in Virginia are eligible. The incentive term is seven years.
The bill also allows counties to provide grants and loans to qualifying companies. Qualifying investments must occur after January 1, 2018 but before January 1, 2025.
A unique feature is that companies may also be eligible for grants or loans up to $2,000 per job from the Commonwealth Opportunity Fund, half of which must be provided to local employees.
The approved legislation will provide substantial incentives to new companies and their employees willing to locate in some of Virginia’s most economically distressed localities. (Del. Will Morefield)
SBIR/STTR matching program (Montgomery County, MD)
The Montgomery County Council approved a new program for county-based businesses that will provide grants up to $25,000 for companies receiving a Phase 1 grant and up to $75,000 for companies receiving a Phase II Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) grant through the National Institutes of Health. $425,000 has been allocated to the program for FY 2019.
This is the first county-based SBIR/STTR matching program in the country. The stated goal of the bill is to encourage small businesses that receive federal grants to locate in Montgomery County.
To be eligible, companies must conduct at least 50% of their R&D operations in Montgomery County. The online application for the grant is now available. The County notes that all companies that meet the established criteria will be approved while funding is available.
The County’s biotech industry is critically important for our future. The additional seed money from this matching grant program will help small businesses that are focused on innovation and technology transfer hire additional employees and expand research opportunities. (Councilmember George Leventhal)