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Escambia
County IDA
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Alabama Enterprise Zone Program |
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(Code of Alabama, 1975, Sections 41-23-20 through 41-23-32). The Alabama Enterprise Zone Program is another marketing tool to help attract new businesses to Alabama. The Alabama Enterprise Zone Act was passed by the Alabama Legislature in 1987. The act authorized state tax and nontax incentives which are some of the best in the country. Escambia County also offers an innovative package of local tax and nontax incentives to encourage businesses to locate in their Enterprise Zone. STATE ENTERPRISE ZONE INCENTIVES 1. If an employer can certify that at least 30% of new permanent employees hired pursuant to the act were formerly unemployed for at least 90 days prior to this employment, then the employer qualifies for the following Alabama income or franchise tax credit on taxes due from the zone operation:
2. Employers may receive the following Alabama income or franchise tax credit for new investments in the zone or improvements to existing facilities in the zone provided at least five new permanent employees are hired.
3. Employers may receive a maximum Alabama income or franchise tax credit of $1,000 per new permanent employee for expenses of training those employees in new skills. Under Section 11 of the Act 1. Employers may receive an exemption from Alabama sales and use tax on the purchases of the materials used in the construction of a building, or any addition or improvement thereon for housing any legitimate zone business and on machinery and equipment used in the zone. 2. Employers may receive certain exemption of Alabama income and corporate franchise taxes for a period of five years. Requirements for Business Participation For Section 5 or Section 11 Incentives, A Business: 1. Must be located in or locating within the boundaries of an Enterprise Zone. 2. Must generally fall into Standard Industrial Classification (SIC) Codes 20-42, 44-49 or consist of major warehousing, distribution centers, or such others activities having a prospect of significant economic impact without threatening the well being of existing industries located within the county hosting the Enterprise Zone. 3. Must expand its labor force, make new capital investment or prevent loss of employment. 4. May not have closed or reduced employment elsewhere in Alabama in order to expand into the Enterprise Zone. 5. Must obtain an endorsement resolution approved by the appropriate local governing authority. For Section 11 Incentives A Business Also: 6. Must certify annually that at least 35% of its employees are residents of the hosting urban Enterprise Zone or are residents of the hosting rural Enterprise Zone county, and were receiving public assistance prior to employment, or were considered unemployable or lacking in basic skills, or any combination of the above. 7. Must give preference and priority to Alabama manufacturers, suppliers, contractors, and labor, except when not reasonably possible to do so without added expense, substantial inconvenience, or sacrifice in operational efficiency.
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