Incentives and Savings
Ohio Enterprise Zone Program
The Enterprise Zone (EZ) program allows companies to locate a facility in certain municipalities or townships and receive a partial property tax exemption on new investments in new or significantly improved buildings. Most of Muskingum County is designated as an EZ. The term and percent of exemption are negotiated. The term and percent cannot exceed 75% for 10 years in municipalities or 60% for 10 years in townships without school board approval. Historically, Muskingum County has offered higher exemption percentages in exchange for payments in lieu of taxes directly to school districts. The EZ program requires completion of an application, which must be approved by local officials prior to beginning construction. Over the last 10 years, Muskingum County has provided exemptions for 30 projects that resulted in an investment of over $343 million, the creation of over 1,300 jobs and the retention of over 1,000 jobs.
Community Reinvestment Area
In portions of the City of Zanesville, the Community Reinvestment Area (CRA) program can provide up to 100% real property tax exemptions on new industrial or commercial properties or the increased value of building improvements. The CRA Program is a direct incentive tax exemption program benefiting property owners who renovate existing or construct new buildings. This program permits municipalities or counties to designate areas where investment has been discouraged as a CRA to encourage revitalization of the existing housing stock and the development of new structures.
Job Creation Tax Credit
The Job Creation Tax Credit is a refundable tax credit to companies generally creating at least 10 new jobs (within three years) with a minimum annual payroll of $660,000 that pay at least 150% of the federal minimum wage. The tax credit is measured as a percentage of the state income tax withholding’s for all new employees hired under the program, and is applied toward the company’s commercial activity tax liability. Should the amount of the credit exceed the company’s commercial activity tax liability for any given year, the difference is refunded. A business must apply for the credit before committing to the project. Applicants must be approved through the Ohio Tax Credit Authority before hiring begins.
Research and Development Investment Tax Credit
The Research and Development Investment Tax Credit is a non-refundable Ohio commercial activity tax credit for all investment in qualified research expenses incurred in Ohio. Qualified research expenses are based on Section 41 definitions in the United States Internal Revenue Code and include expenses for both in-house and contract research expenses. The amount of the credit is based on 7 percent of the amount of all qualified investment in a specific year. The credit can be carried forward for up to seven years.
166 Direct Loan Program
The 166 Direct Loan Program (166 Direct Loan) provides capital for expansion projects to companies that have limited access to capital and funding from conventional, private sources of financing. Priority may be given to eligible projects based on job creation and payroll commitments, fixed asset investment commitment, project return on investment, project location and other project factors. The program may finance allowable project costs with 166 Direct Loans typically ranging in size from $500,000 to $1,500,000. The amount of the 166 Direct Loan will take into account additional financing offered through other State loan programs; total financing from State programs should typically range from 20% to 40% of a project’s total investment. The program requires the creation of jobs within a three-year period, with typically one new job created for every $35,000 – $75,000 of proceeds from State loan programs.
Revolving Loan Funds
The Ohio Mid East Governments Association (OMEGA) has a Revolving Loan Fund (RLF) program that offers low-interest loans to businesses in conjunction with bank financing. RLF funds are used in the event that full financing cannot be obtained from a bank, or to fill the gap between the bank’s participation and the borrower’s cash contribution. The RLF program cannot provide 100% financing of a project. Eligible business must meet the following requirements: be private-for-profit, located in the OMEGA region, must have suitable bank financing, meet all government requirements and must show full financing cannot be obtained from any other source.
Innovation Ohio Loan Fund
The Innovation Ohio Loan Fund (IOF) promotes assistance to existing Ohio companies in developing next generation products and services within certain Targeted Industry Sectors.The IOF Loan addresses an identified need in the capital-funding continuum. The IOF Loan isintended to provide capital to Ohio companies with limited access to capital and funds from conventional financing sources due to technical and commercial risk factors associated with the development of new products or services. The IOF Loan may finance up to 75% of allowable project costs with loans typically ranging in size from $500,000 to $1,500,000. The program requires a commitment to create jobs in the State of Ohio through the IOF Loan program. The number of jobs committed, as well as the annual payroll will be considered when determining the funding amount.
The Revitalization Program is focused on helping revitalize sites in preparation for end-users that support future job creation opportunities for Ohioans. The program, comprised of both loans and grants, is available to public and private entities seeking to cleanup and redevelop sites across Ohio.
Ohio Enterprise Bond Fund
The Ohio Enterprise Bond Fund (OEBF Loan), rated AA+ by Standard & Poor’s, promotes economic development, business expansion and job creation by providing financial assistance for allowable costs of eligible projects in the State of Ohio.The Ohio Treasurer issues bonds, the proceeds of which are loaned to businesses for allowable costs of eligible projects. The OEBF Loan provides long-term, fixed-rate project financing for qualifying businesses that create or preserve employment opportunities in the State of Ohio. The OEBF Loan provides capital to developed companies with limited access to funding at costs comparable to those of rated multi-national corporations. Priority may be given to eligible projects based on job creation and payroll commitments, fixed asset investment commitment, project return on investment, project location and other project factors. The program may finance allowable project costs with OEBF loans typically ranging in size from $2,500,000 to $10,000,000. The amount of the OEBF Loan will take into account additional financing offered through other State loan programs; total financing from State programs should typically range from 20% to 40% of the project’s total investment. The program requires the creation of jobs within a three-year period, with typically one new job created for every $35,000 – $75,000 of proceeds from State loan programs.
Industrial Development Bonds
The Zanesville-Muskingum County Port Authority (ZMCPA) has the ability to issue industrial development bonds for credit-worthy companies undertaking a significant capital project. Bonds issued for manufacturing projects meeting certain guidelines have the ability to be tax-exempt, which lowers the interest rate of the bonds. Projects can be strict conduit financing, or the Port Authority can offer capital lease options. ZMCPA’s involvement can offer tax savings and/or work with larger port authorities or the Ohio Enterprise Bond Fund to enhance the credit of a deal. Up to 90% of a capital project can be financed. Companies must be able to demonstrate their financial strength through their financial statements. A debt reserve account and credit enhancement, typically in the form of a letter of credit, may be required. Prevailing wage rates must be paid on construction.
Grants & Subsidies
JobsOhio Workforce Grant
The JobsOhio Workforce Grant was created to promote economic development, business expansion, and job creation by providing funding for the improvement of worker skills and abilities in the State of Ohio. Grant decisions are based on a number of project factors, including but not limited to job creation, additional payroll, fixed‐asset investment commitment, project return on investment, and project location.
Economic Development Loan and Public Infrastructure Grant Program
The Economic Development Loan and Public Infrastructure Grant Program creates and retains permanent, private-sector jobs, principally for low- and moderate-income persons, through the expansion and retention of business and industry in Ohio communities. Funds are granted to local government applicants for both economic development loan and public infrastructure projects. Public off-site infrastructure funds are retained as a grant by the local government. In the case of a loan, the local government grantee loans the funds to the beneficiary business for fixed asset financing projects and the funds are repaid to the local government Revolving Loan Fund. Eligible activities include provision of financial assistance, through eligible units of general local government, for public off-site infrastructure improvements and fixed asset financing for land, building, machinery and site preparation directly and primarily related to the creation, expansion or retention of a particular business that results in job creation and retention for persons of low- and moderate-income.
The Zanesville-Muskingum County Port Authority owns four business parks, and has the ability to offer utility-served building sites at below market costs for companies that will be making significant investments and creating jobs.