Putnam Development Authority has recently developed a series of innovative financial tools and incentives to assist companies that are considering locating or expanding in Eatonton and Putnam County. The State of Georgia also offers statutory Incentives to support your project.
Click on the map below to view location-based incentives available in the area.
HUB Zone Program
HUBZone is a United States Small Business Administration (SBA) program for small companies that operate and employ people in Historically Underutilized Business Zones.
The HUBZone Program stimulates economic development and creates jobs in urban and rural communities by providing Federal contracting preferences to small businesses. These preferences go to small businesses that obtain HUBZone certification in part by employing staff who live in a HUBZone. The company must also maintain a “principal office” in one of these specially designated areas.
Small businesses are designated as HUBZones certified by the following criteria:
- Company must be a small business by SBA standards.
- Be owned and controlled at least 51% by U.S. citizens, a Community Development Corporation, an agricultural cooperative or an Indian tribe;
- Have its principal office must located within a “Historically Underutilized Business Zone,” which includes lands considered qualified census tracts; qualified non-metropolitan counties; lands within the external boundaries of an Indian reservation; and military facilities closed by the Base Realignment and Closure Act.
- Have at least 35% of its employees residing in a HUBZone.
Opportunity Zone Program
Local governments which undertake redevelopment and revitalization efforts in certain older commercial and industrial areas can now qualify those areas for the State’s maximum job tax credit of $3,500 per job. The incentive, which is available for new or existing businesses that create two or more jobs, is a Job Tax Credit which can be taken against the business’s Georgia income tax liability and payroll withholding tax. The credit is available for areas designated by DCA as an “Opportunity Zone”. DCA will consider designations for areas that are within or adjacent to a census block group with 15% or greater poverty where an enterprise zone or urban redevelopment plan exists.
Opportunity Zone Tax Credit Incentives:
- the maximum Job Tax Credit allowed under law – $3,500 per job created
- the lowest job creation threshold of any job tax credit program – 2 jobs
- use of Job Tax Credits against 100 percent of Georgia income tax liability and withholding tax
- provides for businesses of any nature to qualify, not just a defined “business enterprise”
The EB-5 Visa for Immigrant Investors is a United States visa created by the Immigration Act of 1990. The EB-5 Visa provides a method of obtaining a Green Card (Permanent Residence) for foreign nationals who invest money in the United States which in turn creates or preserves US jobs.
Putnam County is a Targeted Employment Area (TEA) for EB-5 Visa purpose which allows $500,000 USD investment rather than the regular $1 Million USD to qualify for the program.
Corporate Tax Credits
GEORGIA JOBS TAX CREDIT
Georgia provides a statewide job tax credit for any business or headquarters of any such business creating net new jobs for Georgia and engaged in in strategic industries such as manufacturing, warehousing & distribution, processing, telecommunications, broadcasting, tourism, research and development industries, biomedical manufacturing, and services for the elderly and persons with disabilities. The amount of the per-job tax credit depends on the community’s designated tier.
Putnam County is a Tier 2 community and eligible full time jobs may qualify for a job tax credit of $3,000/job per year for 5 years. Putnam County also has two Less Developed Census Tracts (9602.01 & 9602.02) that qualify for a job tax credit of $3,500/job per year for 5 years.
SALES AND USE TAX EXEMPTIONS ON MACHINERY & EQUIPMENT
Sales tax and use tax exemptions significantly lower the cost for Georgia businesses to buy, upgrade and replace critical equipment. In most counties in Georgia, this incentive offers a savings of 7% (4% state sales tax + 3% local sales tax) of the purchase price of manufacturing, material handling, and pollution control equipment.
Here are some of the items exempt from state and local sales tax and use tax:
- Food Processing production machinery and equipment
- Components to upgrade or replace existing machinery
- Warehouse and distribution center machinery (if a company invests $5 million or more in a new or expanded facility)
The sales tax rate in Putnam County is 7 percent.
ELIMINATION OF SALES AND USE TAX ON ENERGY USED IN MANUFACTURING
On January 1, 2013, Georgia will begin to phase out the sales and use tax on energy used in manufacturing. This exemption would apply to energy used directly or indirectly in manufacturing or processing. However, this does not apply toward the generation of electricity. The sales and use tax will be phased out incrementally over the next few years and will be completely phased out by January 1, 2016. 1% will remain and be allocated toward the county’s education system. Putnam County has voted not to impose a local excise tax on energy after the exemption is phased out. The energy sales tax rates for electric and natural gas use will be as follows: 2014 = 4%, 2015 = 2.5%, 2016 = 1%.
INVENTORY TAX EXEMPTION
Georgia’s counties have the authority to enact Freeport Tax Exemption for local businesses through a referendum vote. The voters in Putnam County have elected to exempt commercial and industrial inventory at 100% in all three inventory classes:
• Class 1 – Raw materials and goods in process of manufacture – 100% exemption
• Class 2 – Finished goods produced in Georgia within the last 12 months – 100% exemption
• Class 3 – Finished goods stored in Georgia within the last 12 months and destined for shipment out-of- state – 100% exemption
In order to receive Freeport Tax Exemption, companies must file with the county Board of Tax Assessors each year by April 1st.
ONE-STOP ENVIRONMENTAL PERMITTING
Georgia is one of a handful of states whose environmental permitting program is consolidated with the U.S. Environmental Protection Agency (EPA) for the issuance of federal permits; a one-stop process that provides a faster turnaround than in most other states. The director of the Environmental Protection Division (EPD) of the Georgia Department of Natural Resources is authorized to grant all permits provided for by EPD-enforced laws. Major regulatory programs currently assigned to EPD include air quality control, water quality control and withdrawal, hazardous waste management, solid waste management and wastewater land application. The EPA allows the Georgia EPD to issue permits under the Federal Clean Water, Clean Air and Safe Drinking Water Acts. Georgia’s one-stop permitting reduces government red tape and enables companies to acquire required permits more quickly.
Hiring, Training and Education
Georgia’s Department of Labor (GDOL) assists companies in recruitment by posting job notices, collecting and screening applications and/or résumés, providing interview space, scheduling interviews and hosting job fairs. GDOL will work with private employment agencies that list jobs with the state.
QUICK START EMPLOYEE TRAINING
The number-one workforce training program in the country, Quick Start, develops and delivers fully customized, strategic workforce solutions for qualified companies investing in Georgia. Quick Start helps companies assess, select and train the right people at the right time for success. Services are provided free of charge as a discretionary incentive for job creation for clients opening or expanding manufacturing operations, distribution centers, headquarters operations and customer contact centers in a broad range of industries. Services include:
- Strategic workforce consultation – Quick Start’s training professionals work with company subject matter experts to guarantee training meets business goals.
- Pre-employment assessment – Helps companies assess candidates according to their own defined criteria and preview their skills.
- Customized post-employment and job-specific training – From fundamental knowledge to supervised on-the-job training on a company’s own technology and processes, Quick Start prepares employees for maximum effectiveness and efficiency.
- Leadership and productivity enhancement training – Businesses maintain competitiveness and emphasize continuous improvement for all team members with Quick Start’s guidance. www.GeorgiaQuickStart.org
GO BUILD GEORGIA
Go Build Georgia is designed to educate young people and the public at large about the wage, lifestyle and employment benefits in skilled labor trades, dispel misconceptions about the skilled trade industry and inspire them to consider building a career as a skilled tradesman. Through this public awareness effort, Go Build Georgia aims to provide better opportunities for craft tradesmen, more highly skilled employees for businesses and enhanced economic development for Georgia and the nation. www.gobuildgeorgia.com
RETRAINING TAX CREDIT
A company’s direct investment in training can be claimed as a tax credit, up to 50 percent of the employer’s direct cost up to $500 per approved training program.
- The total amount of credit cannot exceed $1,250 per employee per year.
- Training programs must be approved by the Technical College System of Georgia.
- This tax credit can be used to offset up to 50 percent of a company’s state income tax liability.
- Unused credits can be carried forward 10 years. These credits can be combined with other tax credits.
- The credit is available to all Georgia businesses that file a Georgia income tax return.
- The retraining program must be for quality and productivity enhancements and certain software technologies.
Retraining Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.5. For a detailed guide on these credits, visit www.georgiaquickstart.org/econdev/retrain.html.
HOPE SCHOLARSHIP AND GRANT
HOPE — Helping Outstanding Pupils Educationally — is Georgia’s unique scholarship and grant program that rewards students with financial assistance in degree, diploma, and certificate programs at eligible Georgia public and private colleges and universities, and public technical colleges. The HOPE Grant provides tuition assistance to Georgia residents seeking a technical degree or certificate at one of Georgia’s technical colleges, regardless of the student’s high school grade point average or graduation date. These programs can be advantageous to relocating families with children, and for companies training employees through local technical colleges.
UNIVERSITY SYSTEM OF GEORGIA ECONOMIC DEVELOPMENT
The Board of Regents of the University System of Georgia created an Office of Economic Development in 1995. The System’s Economic Development staff, working with a team of economic development leaders from each campus, bridges the intellectual resources of Georgia’s 31 public college and universities to the Georgia Department of Economic Development and the state’s business community in innovative ways. Georgia businesses can connect with college-educated talent, the latest research and business and operations advice. www.usg.edu/economic_development
Assistance for Small Businesses and Entrepreneurs
Small businesses can qualify for many of the programs outlined in this brochure. In addition, Georgia offers several programs specifically designed to meet the needs of small businesses and entrepreneurs.
ANGEL INVESTOR TAX CREDIT
Georgia now offers an income tax credit for qualified investors who invest in certain qualified businesses in Georgia in calendar years 2011, 2012 and 2013. The credit is claimed two years later, in 2013, 2014 and 2015, respectively. The credit is 35 percent of the investment with an individual investor cap of $50,000 per year. The aggregate annual cap for this program is $10 million. The qualified investor must get approval from the Georgia Department of Revenue before claiming the credit. Angel Investor Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.30 and rules published by the Georgia Department of Revenue in regulation 560-7-8-.52.
SMALL BUSINESS TAX RELIEF
Georgia allows for faster depreciation on equipment deduction, in which businesses can choose to claim the expense in year one as opposed to over several years’
ENTREPRENEUR AND SMALL BUSINESS LOAN (ESB) GUARANTEE PROGRAM
In partnership with the OneGeorgia Authority, the state can provide loan guarantees to spur entrepreneurial growth in specified rural communities throughout Georgia. The guarantee amounts can range between $35,000 and $250,000, can be used for hard assets or for start-up and working capital, and require a 10 percent cash equity injection by the borrower. www.onegeorgia.org/programs/esb
Assistance For Georgia’s Existing Industries
INVESTMENT TAX CREDIT PROGRAMS (after 3 years)
Taxpayers must choose either the investment tax credit or the job tax credit. Investment tax credits are available to an existing manufacturing or telecommunications business that has operated a facility in Georgia for three years prior to the investment and invests $50,000 or more. Investment tax credits generally range from 1% to 8% of qualified capital investment. The exact credit depends on the tier level of the county where the investment occurs. (The tier status is re-evaluated annually). The taxpayer must submit an application to the Georgia Department of Revenue to apply and qualify for the Investment Tax Credit. Higher level credits for investment in recycled equipment and pollution control equipment.
Example – Putnam County is currently Tier 3. Taxpayer in Putnam County invests $5 million in a manufacturing plant plus $1 million in recycling equipment. Taxpayer is eligible for an $80,000 tax credit to reduce or eliminate Georgia income tax. [$5 million x 1%] + [$1 million x 3%] = $80,000. Investment tax credits can be used against 50% of income tax liability in a given year. Unused credits may be carried forward 10 years.
CENTERS OF INNOVATION
The Georgia Centers of Innovation provide connections and innovative solutions to Georgia businesses operating in our six strategic industries. Centers of Innovation in Aerospace, Agribusiness, Energy, Life Sciences & IT, Logistics and Manufacturing provide direct access to university and technical college applied research, commercialization resources, technology connections, matching grant funds, industry networks and key government agencies. Client companies are connected with experts who are on the leading edge of technology and new ideas in their respective industries. Within this framework, the Centers of Innovation create a supportive business environment to help Georgia companies grow, prosper and compete globally. www.georgiainnovation.org