Sales,
Use & Property Tax Abatements
A new or expanding industry may apply to the Tuscaloosa County Industrial
Development Authority for an abatement of the following:
noneducational state, county and city property taxes
state sales and use taxes
noneducational county and city sales and use taxes
mortgage and recording taxes
Property tax abatement
available for up to 10 years;
Sales and use tax
abatements available during construction phase of project.
Predominate activity
conducted at the project must constitute an "industrial or research enterprise."
Qualifying projects include
any trade or business designated
within Standard Industrial Classification (SIC) Code classifications Major
Groups 20 to 39 inclusive,
Major Groups 50 and 51, Industrial
Group number 737, and Industry numbers 0724, 4613, 8731, 8733, 8734.
Capital
Income Tax Credits
The capital credit is a credit of five percent (5%) of capital costs of a
project, to be applied to Alabama income tax liability
generated by project income, each
year for 20 years.
The qualifying project
must constitute either a "headquarters facility" (national, regional,
or state headquarters),
or an "industrial, warehousing,
or research activity."
Qualifying projects
include any trade or business designated within SIC Code classifications Major
Groups 20 to 39 inclusive,
Major Groups 50 and 51, Industrial
Group number 737, and Industry numbers 8731, 8733, 8734.
A New project, expansion
project or headquarters facility must represent a capital investment of at
least $2,000,000 and 20 new employees.
A small business addition
must represent a capital investment of at least $1,000,000 and 15 new employees.
Average hourly wage
of new employees must represent not less than eight dollars ($8) per hour;
or average hourly compensation,
including benefits, of not less
than ten ($10) per hour.
Tax
Exempt Industrial Revenue Bonds
Tax Exempt Industrial
Revenue Bonds (IRBs) may be issued by the Tuscaloosa County Industrial Development
Authority.
IRBs provide financing
for land, building and equipment for new and expanding manufacturing facilities.
Generally, total
project investment must be less than $10,000,000.
Other criteria/requirements
apply.
Taxable
Industrial Revenue Bonds
Taxable industrial
revenue bond issues may be issued by the Tuscaloosa County Industrial Development
Authority
for transactions
that do not qualify for tax exempt bond financing.
Taxable IRBs continue
as one of the mainstays of industrial finance because they may be issued with
fewer
restrictions and
in unlimited amounts while the user maintains tax savings.
Solid
Waste and Sewage Disposal Bonds
Bond
issues can be structured to the extent an engineering study justifies treating
a portion of plant costs as
attributable
to solid waste or sewage disposal.
Pollution
Control Facilities
Air and water pollution control facilities automatically exempt
from sales, use, and property taxes, if taxpayer claims the exemption.
Alabama offers a number of non-tax incentives that assist in the start-up of a new or expanding project. These inducements include training assistance and financial assistance. The following summarizes the most significant programs:
Alabama Industrial
Development Training
Training services offered in many areas, and are free of charge
to new and expanding industries throughout the State.
Program
extremely flexible and custom-designed for each industry.
Site Preparation
Grants (also known as Industrial Development Grants)
The State Industrial Development Authority (SIDA) issues grants
for the preparation of project sites.
Qualifying projects include any trade or business designated
in SIC Code classifications Major Groups 20 through 39,
Major Groups 50 and 51, Industrial group 737, and Industry Numbers 0724, 8731,
8733 and 8734.
Alabama
State Employment Service ("ASES")
ASES works with AIDT to provide job screening and testing,
at no charge.
Alabama Plan
for Linked Deposits
The Alabama
Plan for Linked Deposits allows the State Treasurer to make deposits in state
banks on which banks pay
2% below the normal interest rate
paid to the state for its funds. The reduction in the interest rate paid by
the bank must
be passed on to the borrowers on
loans qualifying for this program. It amounts to a 2% subsidy on the borrower's
interest
rates for two years to help stimulate
economic growth in the state.
Small Business
Administration
The
Small Business Act of 1953, Section 7(a), as amended, guarantees loans to
small businesses which are unable to
obtain
financing in the private credit marketplace, but can demonstrate an ability
to repay loans granted.
Small
Business Investment Act of 1958, as amended, Title V, Section 504 and 505,
assists small business
concerns by providing long- term, fixed-rate financing for fixed assets through
the sale of debentures to private investors.
Alabama
Industrial Access Road and Bridge Program
The
Alabama Industrial Access Road & Bridge Corporation provides funding for
industrial access road and bridge construction
in
Alabama. The Tuscaloosa County Industrial Development Authority can sponsor
an entity for an Industrial Access Project.
Eligible
industrial access projects may be new road construction or road improvement
to assist new or expanding industry
(example:
turn-lane, deceleration lane, pave unimproved road, widening, resurfacing,
bridge replacement, etc.).
Proposed road projects must
be a public right-of-way and, if funded, shall constitute part of the public
highway and street system of the state.
Alabama
Infrastructure Grants
The
State Economic Development Grant program administers a pool of funds available
for infrastructure grants.
These
grants are made to a governmental body to facilitate the expansion or development
of new industry by
funding public infrastructure projects,
including water and sewer lines, and access roads.
Qualifying
projects include any trade or business designated in SIC Code Major Groups
20 through 39,
or consisting of major warehouse
or distribution centers.
At
least 15 jobs must be created.
Generally,
grants do not exceed $200,000 per project.
Source
of funds include Alabama Department of Economic and Community Affairs (ADECA),
Community
Development Block Grants (CDBG), and State and Federal Governments.
Other criteria/requirements
apply.
Rural
Economic and Community Development Loan and Grants
A
business can qualify if not located in MSA.
Loans
guaranteed up to 75-80% of the loan.
Small grants up to $100,000.00
also available.
The information presented is general in nature and may not apply to your specific situation. Legal advice should be sought before taking action based on the information provided.
