1 / 13

Georgia Department of Community Affairs Opportunity Zones State Job Tax Credit

Georgia Department of Community Affairs Opportunity Zones State Job Tax Credit. Opportunity Zones O.C.G.A. 48-7-40.1(c)(4). General Strategy

waseem
Download Presentation

Georgia Department of Community Affairs Opportunity Zones State Job Tax Credit

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Georgia Department of Community AffairsOpportunity ZonesState Job Tax Credit

  2. Opportunity ZonesO.C.G.A. 48-7-40.1(c)(4) • General Strategy • Encourage local governments to use existing redevelopment statutes in an innovative fashion to revitalize blighted commercial, industrial and adjoining residential areas • Reward local governments and businesses that undertake such revitalization with access to maximum State Job Tax Credits • Operate state-wide, wherever eligible “pockets of poverty” and redevelopment needs occur (rural, urban and suburban). • Support bottom up, locally driven initiatives through local collaborative partnerships

  3. Promising Uses for Opportunity Zones • Rural areas with sluggish economies and blighted industrial, commercial and adjoining residential areas • Brownfields • Declining commercial corridors • Pockets of older commercial and industrial areas with outdated (blighted) facilities and buildings in otherwise affluent counties • Deteriorating in-town neighborhoods adjoining older industrial areas (state EZ allows tax abatement on rehabilitated housing)

  4. Opportunity Zone RequirementsO.C.G.A. 48-7-40.1(c)(4) • Opportunity Zones are enabled pursuant to “less developed area” portion of BEST [O.C.G.A 48-7-40.1(c)(4)] • Allows DCA to designate as an “Opportunity Zone”, an area within or adjacent to one or more contiguous census block groups with a 15% or greater poverty rate, where the area is part of an Enterprise Zone OR where a Redevelopment Plan has been adopted by the local government, and the area displays pervasive poverty, underdevelopment, general distress and blight.

  5. Opportunity ZonesApplicable Statutes for Local “Tools” • Georgia Urban Redevelopment Law – O.C.G.A. 36-61; OR/AND • Enterprise Zone Employment Act – O.C.G.A. 36-88

  6. Local Redevelopment Tools – Urban Redevelopment Law (O.C.G.A. 36-61) • Provides cities and counties the power to rehabilitate, conserve or redevelop a blighted area • Local government must adopt a resolution finding the area is blighted and that redevelopment is necessary • Local government must adopt an urban redevelopment plan for the target area

  7. Local Redevelopment Tools - Enterprise Zone Employment Act (O.C.G.A. 36-88) • State Enterprise Zone Criteria • Poverty • Unemployment • general distress • underdevelopment • Blight • Local property tax breaks for Commercial and Residential Property • Other Local Incentives

  8. Incentives • State designation of an Opportunity Zone would allow: • ANY businesses (including retail) within the area to qualify, not bound by “Business Enterprise” definition • Lower job creation threshold to 2 jobs to qualify for the state’s maximum job tax credit of $3,500 per job • Allow credit against 100% of income tax liability, with excess credit available to claim against payroll withholding

  9. Example of OZ Credit Usage Jobs Created Credit Tax Liability Withholding Year 1 2 $ 0 Year 2 3 $7,000 $1,200 $5,800 Year 3 3 $10,500 $1,000 $9,500 Year 4 4 $10,500 $1,500 $9,000 Year 5 4 $14,000 $1,700 $12,300 Year 6 5 $14,000 $2,100 $11,900 Year 7 5 $10,500 $2,050 $8,450 Year 8 6 $7,000 $1,800 $5,200 Year 9 6 $7,000 $1,750 $5,250 Year 10 6 $3,500 $1,450 $2,050 Year 11 7 $3,500 $1,600 $1,900 Year 12 7 $ 0 $ 0 TOTALS $87,500 $16,150 $71,350 In the above example, a Job Tax Credit of $87,500 is generated, with the business able to utilize all of the credit

  10. Redevelopment Area before/after

  11. Opportunity Zones – Partnerships! • Partnerships with other public and private entities targeting same areas: • Private • Bank CRA Programs, Non-Profits, Philanthropic organizations • Federal • HUD’s CDBG, HOME, HOPE and others • Treasury’s New Market Tax Credits and CDFI programs • SBA, USDA, FHLB, HHS and others

  12. Application, regulation, maps and more available at: • http://www.dca.state.ga.us/economic/DevelopmentTools/programs/opportunityZones.asp For questions, please contact: Dawn Sturbaum (404) 679-1585 dsturbau@dca.state.ga.us Brian Williamson (404) 679-1587 bwilliam@dca.state.ga.us

More Related