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Capital

BUILD Loan Program   

Low interest short term loans available to nonprofit organizations that help meet the housing needs of low and very low income households
The loans may be secured or unsecured depending on the proposed activity. BUILD Loan funds must be used for operating and program expenses incurred to create affordable housing opportunities for low and very low-income households. Eligible activities may include: 1) Development of single and multi-family units for homeownership or rental, 2) Construction, 3) Land Acquisition, 4) Site Preparation, 5) Pre-Development.

The purpose of the BUILD Loan Program is to promote the production, preservation, and rehabilitation of housing for low and very low income households.


Offers low-interest loans to finance building renovations in downtown area
Low-interest loan program offers up to $90,000 for building renovations based on established project evaluation criteria. The loan is amortized over a 20 year period at a three percent (3%) interest rate with a balloon payment due at the end of the tenth (10th) year. The Development Loan Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID), which is bound by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center which is bound by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas on the west.

Designed to encourage commercial real estate development within the Central Business Improvement District.

 

Extends the term of the PILOT program for those who hire minority employees or contractors
All PILOT companies must file a Diversity Plan with the industrial development board, but those which meet or exceed all of the goals of the Diversity Plan may extend the PILOT by one or two years at the discretion of the Industrial Development Board.

Created to encourage the support and inclusion of minority, women, and locally owned small businesses in the economic development of the local community.

Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects
The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.
Provides below market rate loans to help implement projects that reduce energy use, improve cash flow and provide a new opportunity for growth
Financing is available for up to 100 percent of the costs for installing energy efficient technology, energy retrofits and renewable energy systems that will help them reduce energy consumption. Loans are offered up to 5 million dollars. Eligible projects include: Lighting, HVAC, Building Retrofits, Industrial Systems, Co-Generation, and Renewable Energy/Solar Projects.

Created to help businesses and industries become more energy efficient, so that they may increase their competitiveness and strengthen Tennessee’s economy.



Bonds for the building and rehabilitation of affordable housing
Project must consist of the acquisition of land or the acquisition, rehabilitation, construction or improvement of affordable housing, typically multifamily residential units. Either at least 20% of the units in the Project must be rented to individuals whose income is 50% or less of the Median Gross Income for Memphis, or at least 40% of the units in the Project must be rented to individuals whose income is 60% or less of the Median Gross Income. Except for those Units rented to the elderly or handicapped, units must be rented either to tenants earning less than 150% of the Median Gross Income, or at a rental rate less than 30% of 150% of the Median Gross Income for Memphis.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.
Provides expansion loans to established businesses with an emphasis on manufacturers and distributors
Loan proceeds may be used for any legitimate business purpose, including working capital machinery and equipment, property acquisitions and construction (building renovations ore leasehold improvements). To be considered, the business must be operating for at least 18 months and be in good financial standing. EDGE Impact Fund requires, at a minimum: 2009, 2010 and 2011 tax returns; year-end and current interim 2012 financial statements; and current business debt schedule. Loan size is $150,000 ? $2 million. Interest rates are based on floating, risk-based pricing. Fixed rates are available. Repayment terms vary based on use of funds (including refinance).

Created to promote the expansion of existing businesses, particularly manufacturers and distributors.
Tax credit of up to 50% of franchise and excise tax liability for purchasing, installing, or repairing industrial machinery
The credit applies to the purchase, installation and repair of industrial machinery as defined in T.C.A. 67-6-102. The credit also applies to the purchase and installation of computer, computer software and certain peripheral devices purchased in order to meet the capital investment thresholds of the Job Tax Credit. Any unused Industrial Machinery Tax Credit may be carried forward for up to 15 years. The percentage of Industrial Machinery Credit allowed is dependent upon the investment made during the investment period, from 1% to 10%.

Created to encourage capital investments in industrial machinery.
Extends certain tax credits to businesses qualified as an "integrated supplier" or "integrated customer"
Must be located within the footprint of a project meeting the $1 billion investment threshold and creating 500 or more occupational wage jobs. An integrated supplier or integrated customer locating within the footprint of such a project will qualify for a Job Tax Super Credit equal to $5,000 per qualified job with a 15 year carry-forward, plus an additional $5,000 per job each year for 6 years. The Integrated Supplier Tax Credit applies regardless of capital investment or number of jobs created.

The purpose of the Integrated Supplier and Integrated Customer Tax Credit is to expand the impact of large "anchor" projects by encouraging co-location of suppliers and customers.
Allows headquarters to convert unused net operating losses (NOL) to a credit against franchise and excise tax liability
Companies with a regional, national or international qualified headquarters facility in Tennessee may, with approval from the Commissioner of Revenue and the Commissioner of Economic and Community Development, convert unused net operating losses (NOL) to a credit against franchise and excise tax liability. The NOL credit is available only if the company is unable to use the NOL to offset net income during the current tax year.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.
Allows individual and corporate investors to receive a tax credit for making equity investments in Community Development Financial Insitutions
The credit totals 39 percent of the original investment amount and is claimed over a period of seven years. Equity investment must be made in Community Development Entity certified by the US Treasury. CDIs provide investment capital for low-income communities or low-income persons.

Established by Congress in 2000 to spur new or increased investments into operating businesses and real estate projects located in low-income communities.
Tax abatement of up to 90% of city personal and property taxes and 75% of county personal and property taxes for a maximum of 15 years
Amount of abatement is determined by capital investment, number of new jobs, average wage of new jobs, location of project, diversity plan, environmental plan, and industry. To be considered, companies must have a minimum capital investment of $1 million and hire add at least 15 new jobs at an average salary of $10 or more per hour. Retention PILOTs require a minimum capital investment of $10 million and the creation of at least 100 new jobs.

Created to alleviate the burden of start-up and relocation expenditures.
Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time
The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here: http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf

The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.
Provides small businesses and entrepreneurs loans for creating and retaining jobs
Loans are based upon the borrower's needs, repayment ability, what the borrower is financing and confirmation that jobs will be created. Interest rates are determined by perceived credit risk and are two percentage points below the current prime rate with a floor of four percent.

Designed to boost local strategies that enable the community to invest in small businesses and entrepreneurial initiatives, encouraging the creation, retention, and expansion of jobs helping grow the local economy. 

Provides loans at below market rates to rural micro-businesses and micro-enterprises
Rural Small Business and Entrepreneurship Loan Fund helps small businesses, specifically micro-businesses or micro-enterprises grow and maintain their businesses. Must be a business with fewer than 10 employees including the owners. Company must be located in rural Tennessee.

Established to provide an alternative source of capital to small business owners who can't get conventional bank loans and don't want to use credit cards.
A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.

Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.
Credit of 6.5% of the 7% state sales and use tax for qualified headquarters
Credit for sales and use tax paid on qualified tangible personal property purchased for the headquarters during the investment period. The investment period for the sales and use tax credit begins one year prior to construction or expansion and ends one year after construction or expansion is substantially complete and cannot exceed 6 years. Note: The taxpayer must file and receive approval of the Qualified Headquarter Business Plan with the Department of Revenue before taking the sales and use tax credits.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.
Provides economically distressed counties with loans for industrial expansion, relocation, retention, and infrastructure development
Only counties with the lowest per capita personal income, the highest percentage of residents below the poverty level, and the highest annual average unemployment rates are eligible for this program. SOC loans are made for buildings, plant equipment, infrastructure, or real estate based on the capital investment leveraged and the number of jobs created by a venture. SOC loans can also be made to local economic development entities for capacity-building projects such as sites or buildings. View a map of the Special Opportunities Counties, here (http://www.tvaed.com/pdf/soc_counties.pdf).
Monthly power bill credits to qualifying power customers who contribute to the economic development of the Tennessee Valley
Award amounts based on capital investment, jobs added or retained, average wages paid, and annual load factor. Requires at 250-kilowatt peak monthly demand, and minimum of 25 employees with no plans to reduce workforce by 50 percent or more. Must commit to a projected five-year capital investment of 25 percent of an existing facility?s book value, or $2.5 million in a new facility. Requires standard power contract with a remaining term at least as long as the five- or eight-year VII award period.

Created to lower energy costs for companies that contribute to economic growth.
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Distressed Communities

Affordable Apartment Rental Additional Unit Allowance   

Apply an additional 50% revenue allowance over MLGW’s standard policy.
The developer must submit documentation proving that the particular apartment development is recognized as a low income development by the appropriate nonprofit or government agency. The builder must also enroll the apartment development in MLGW’s EcoBuild program. Promote development of apartments for affordable rental housing.

Connect fees may be waived or refunded to the home builder.
The Builder must submit proof of the home’s certification from a non-profit or government agency that the home is eligible for “affordable” incentives at the time the service request is made; The builder must enroll the home in MLGW’s EcoBuild program; The home must be an individual single-family home or duplex; The maximum sale price shall be $140,000. Promote non-profit and governmental agency efforts to produce affordable dwelling units.


 
Affordable Housing Additional Lot Allowance Incentive   
Apply an additional 50% lot allowance over MLGW’s standard policy
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Diversity

Diversity Plan   

Extends the term of the PILOT program for those who hire minority employees or contractors
All PILOT companies must file a Diversity Plan with the industrial development board, but those which meet or exceed all of the goals of the Diversity Plan may extend the PILOT by one or two years at the discretion of the Industrial Development Board.

Created to encourage the support and inclusion of minority, women, and locally owned small businesses in the economic development of the local community.


Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects
The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.



Provides tax credit to employers who hire employees from identified target groups which traditionally face high rates of unemployment
Available to employers who hire and retain veterans and individuals from other target groups with significant barriers to employment. Employers generally can earn a tax credit equal to 25% or 40% of a new employee's first-year wages, up to the maximum for the target group to which the employee belongs. Employers will earn 25% if the employee works at least 120 hours and 40% if the employee works at least 400 hours.

Developed to address high unemployment rates among certain groups.
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Employment

Commercial Office Grant Program for Tenant Improvements    

Offers eligible tenants matching grants for up to 50% of the cost of tenant improvements.
The property or lease space must be located within the Central Business Improvement District; The Tenant must be classified as and determined as being an office tenant with an office use and with employees who work within the leased premises or within the CBID; The Tenant must employ at least three (3) full-time employees/equivalents (FTEs) at the eligible location; The Tenant must apply prior to entering into a lease; The Tenant’s current lease (if applicable) must be due to expire within 12 months of the application date; and, The Tenant must sign a lease that includes a term of at least five (5) years. *Note: Retail tenants are ineligible for the Program.

This program is designed to stabilize and strengthen the Downtown office market by increasing the number of full-time employees/equivalents within the area.





Tax credit for the purchase of materials related to the construction of a data center.
Applies to buildings housing high technology computer systems and related equipment in which the taxpayers had made a minimum capital investment of $250 million and has created 25 new jobs paying at least 150% of the state's average occupational wage. Investments must be made during a 3 year period, but can be extended to 7 years at the discretion of the Commissioner of Economic and Community Development; The purchase of computers, computer systems, computer software and repair parts for a qualified data center are considered purchases of industrial machinery and qualify for a minimum 5% Industrial Machinery Tax Credit against F&E liability. Computers, computer systems, computer software and repair parts used in qualified data centers are classified as industrial machinery and exempt from sales and use taxes. Qualified data centers also pay reduced sales taxes on the purchase of electricity (1.5% vs. the previous rate of 7%).

Created to assist expanding and emerging tech companies with expansion.




Extends the term of the PILOT program for those who hire minority employees or contractors
All PILOT companies must file a Diversity Plan with the industrial development board, but those which meet or exceed all of the goals of the Diversity Plan may extend the PILOT by one or two years at the discretion of the Industrial Development Board.

Created to encourage the support and inclusion of minority, women, and locally owned small businesses in the economic development of the local community.





Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects.
The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.



Reimburses up to 100% of eligible job training expenses for new or expanding companies, and assists with development of training plans.
This incentive is available to both new and expanding industry and begins with a company developing a training plan including the number of people to be hired, types of skills required and types of training needed. The plan is developed in conjunction with the FastTrack staff and is designed to be customizable and flexible. Companies will track costs associated with implementation of the training program, then submit to the state for reimbursement. Job training assistance can include either traditional or job based training reimbursement.

Created to assist companies in training new employees.




Tax credit against expenses incurred in relocating a headquarters.
Companies establishing a qualified headquarters facility may qualify for credits against their franchise and excise tax liability based on the amount of qualified relocation expenses incurred in the establishment of a headquarters facility. This is a fully refundable tax credit. Credits range from $10,000 to $100,000 per position.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.


Provides grant funding for customized training for existing for-profit and not-for-profit (healthcare related) businesses that result in layoff aversion
For profit businesses, and not-for-profit healthcare businesses are eligible to apply. Note: 1) The grant period is October 1st through September 30th; 2) The application deadline for the 2012-2013 grants is October 31st, 2012; 3) Applicant must be in business one year prior to submitting an application; 4) Applicant must employ a minimum of five full time employees (independent contractor/1099 employees are not eligible for training); 5) Applicant must be current on all federal and state taxes; 6) Maximum award is $25,000 per grant, with a total funding limit of $50,000 per employer in consecutive program years; and 7) A 50% employer match is required.

Developed to help existing for-profit and not-for-profit (healthcare related) businesses avoid employee layoffs.



Integrated Supplier and Integrated Customer Tax Credit   
Extends certain tax credits to businesses qualified as an "integrated supplier" or "integrated customer"
Must be located within the footprint of a project meeting the $1 billion investment threshold and creating 500 or more occupational wage jobs. An integrated supplier or integrated customer locating within the footprint of such a project will qualify for a Job Tax Super Credit equal to $5,000 per qualified job with a 15 year carry-forward, plus an additional $5,000 per job each year for 6 years. The Integrated Supplier Tax Credit applies regardless of capital investment or number of jobs created.
The purpose of the Integrated Supplier and Integrated Customer Tax Credit is to expand the impact of large "anchor" projects by encouraging co-location of suppliers and customers.




Job Based Training Reimbursement (JBT)   
Reimburses up to 50% of job training expenses in the first 90 days and up to 100% after 180 days
An expedited method for reimbursement of training costs. JBT is available in the FastTrack Job Training Assistance Program (FJTAP), as well as Tennessee Job Skills (TJS), as a possible reimbursement method. In order to qualify, companies must work with ECD to reach a contractual agreement that determines cost-per-job and the total commitment of jobs. Once agreed upon with ECD, companies can seek reimbursement of 50% of the cost-per-job within the first 90 days after the job is created and maintained. The remaining 50% can be claimed 180 days after the job is created and maintained. Note: 1) The company must agree to provide documentation, including the number of jobs created; 2) Multi-year contracts between a company and ECD can be reached to accommodate multi-year job creation projects; and 3) If the total commitment of jobs is reached, companies may seek the entire training reimbursement allocation through JBT.

Created to be a faster way for businesses to get reimbursed for job-based training.




Credit of $4,500 per new job to offset up to 50% of franchise and excise taxes
Must create at least 25 new jobs within a 36 month period and invest at least $500,000 in a qualified business enterprise. May offset up to 50% of franchise and excise taxes and be carried forward for 15 years. The credit may not be taken until the year the 25 job threshold is met unless the business has requested and received a waiver.

Developed to encourage job creation.



WIN contracts with businesses in the public, private non-profit, and private sectors to provide On-the-Job Training (OJT) to eligible WIN participants; Depending upon the details of the agreement, businesses may be reimbursed up to 50% of the trainee’s wage during the training period
Participation requirements are as follows: 1) The job seeker must be eligible for training through the Workforce Investment Act, i.e. either unemployed or underemployed (defined as not earning a self-sufficiency wage of $15 or more per hour); 2) The employer must be willing to provide OJT participants with continued long-term, full-time employment (with wages, benefits, and working conditions that are equal to those provided to regular employees who have worked a similar length of time and are doing the same type of work); 3) An OJT contract must be limited to the period of time required for a participant to become proficient in the occupation for which the training is being provided. In determining the appropriate length of the contract, consideration should be given to the skill requirements of the occupation, the academic and occupational skill level of the participant, prior work experience, and the participant’s individual employment plan.

Developed so that employers can remain competitive and the State of Tennessee can produce viable, progressive businesses.





Tax abatement of up to 90% of city personal and property taxes and 75% of county personal and property taxes for a maximum of 15 years
Amount of abatement is determined by capital investment, number of new jobs, average wage of new jobs, location of project, diversity plan, environmental plan, and industry. To be considered, companies must have a minimum capital investment of $1 million and hire add at least 15 new jobs at an average salary of $10 or more per hour. Retention PILOTs require a minimum capital investment of $10 million and the creation of at least 100 new jobs.
Created to alleviate the burden of start-up and relocation expenditures.



Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time
The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here: http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf)

The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.




Provides small businesses and entrepreneurs loans for creating and retaining jobs
Loans are based upon the borrower's needs, repayment ability, what the borrower is financing and confirmation that jobs will be created. Interest rates are determined by perceived credit risk and are two percentage points below the current prime rate with a floor of four percent.

Designed to boost local strategies that enable the community to invest in small businesses and entrepreneurial initiatives, encouraging the creation, retention, and expansion of jobs helping grow the local economy.


Allows a qualified business locating or expanding in a Tier 2 county may take 3 years to create 25 jobs, and business locating or expanding in a Tier 3 county may take 5 years to create 25 jobs
The Enhanced Job Tax Credit for Tier 2 and Tier 3 Enhancement Counties is in addition to the regular Job Tax Credit and cannot be carried forward. If a qualified business enterprise locates or expands in a Tier 2 or Tier 3 Enhancement County, the company will be eligible for an annual Enhanced Job Tax Credit of $4,500 for each qualified job, provided that the job remains filled during the year in which the credit is being taken. The annual credit may be used to offset up to 100% of the company's total franchise and excise (F&E) tax liability each year for a three-year period in Tier 2 counties and a five-year period in Tier 3 counties.

The Enhanced Job Tax Credit was created to promote new industry locations and expansions in more rural areas of the state.
 


A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.

Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.



Credit of 6.5% of the 7% state sales and use tax for qualified headquarters
Credit for sales and use tax paid on qualified tangible personal property purchased for the headquarters during the investment period. The investment period for the sales and use tax credit begins one year prior to construction or expansion and ends one year after construction or expansion is substantially complete and cannot exceed 6 years. Note: The taxpayer must file and receive approval of the Qualified Headquarter Business Plan with the Department of Revenue before taking the sales and use tax credits.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.



 
Provides economically distressed counties with loans for industrial expansion, relocation, retention, and infrastructure development
Only counties with the lowest per capita personal income, the highest percentage of residents below the poverty level, and the highest annual average unemployment rates are eligible for this program. SOC loans are made for buildings, plant equipment, infrastructure, or real estate based on the capital investment leveraged and the number of jobs created by a venture. SOC loans can also be made to local economic development entities for capacity-building projects such as sites or buildings. View a map of the Special Opportunities Counties, here (http://www.tvaed.com/pdf/soc_counties.pdf).

Created to spur growth in economically distressed counties.



Credit of $5,000 per new job to offset up to 100% of franchise and excise taxes for a period of 3 to 20 years; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.
Company must invest capital of $100 million or more and create a minimum of 100 jobs paying at least 100% of Tennessee's average occupational wage or invest $10 million in a qualified headquarters facility and create at least 100 new headquarters jobs paying 150% of the average occupational wage. These credits can be used to offset up to 100% of the company's F&E tax liability each year for 3 to 20 years starting the first tax year after the job creation and capital investment thresholds have been met. In addition to the jobs portion of the Super Credit, a company that qualifies for the Super Credit may exempt two-thirds (2/3) of the required capital investment made during the investment period from the property measure of its franchise tax base on Schedule G of the company's F&E tax return during the tax years in which the annual credit is actually taken.

Created to incentivize larger, more capital-intensive investments.




Super Jobs Tax Credit for Qualified Headquarters   
Tax credit of $5,000 for each new high-wage job created, offsetting up to 100% of franchise and excise taxes; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.
Must commit to $10 million capital investment and create at least 100 headquarters jobs paying 150% of the average occupational wage in establishing or expanding a qualified headquarters facility. Credit good for three years with no carry forward. The Commissioner of Revenue may lower the wage requirement and investment criteria for a qualified headquarters facility if the headquarters locates in a Central Business District or Economic Recovery Zone. The investment period for the Super Job Tax Credit is 3 years, but may be expanded to 5 years with approval from the Commissioner of Economic and Community Development.

Developed to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.




A special training reimbursement program for emerging, high-demand, and technology focused businesses
Similar to FJTAP, but with a focus on employers and industries that create high-skill, high-wage jobs in emerging, high-demand and technology focused sectors of the economy. Training staff work with companies to develop a unique, flexible, comprehensive training plans that meet the company's initial training needs and follow up to ensure each phase of the program meets the company's needs. Companies track costs and apply to the State for reimbursement. Reimbursement rates depend on the level of training and the types of instructors utilized.

Created to assist companies in hiring new employees.



Monthly power bill credits to qualifying power customers who contribute to the economic development of the Tennessee Valley
Award amounts based on capital investment, jobs added or retained, average wages paid, and annual load factor. Requires at 250-kilowatt peak monthly demand, and minimum of 25 employees with no plans to reduce workforce by 50 percent or more. Must commit to a projected five-year capital investment of 25 percent of an existing facility?s book value, or $2.5 million in a new facility. Requires standard power contract with a remaining term at least as long as the five- or eight-year VII award period.

Created to lower energy costs for companies that contribute to economic growth.
Provides tax credit to employers who hire employees from identified target groups which traditionally face high rates of unemployment
Available to employers who hire and retain veterans and individuals from other target groups with significant barriers to employment. Employers generally can earn a tax credit equal to 25% or 40% of a new employee's first-year wages, up to the maximum for the target group to which the employee belongs. Employers will earn 25% if the employee works at least 120 hours and 40% if the employee works at least 400 hours.

Developed to address high unemployment rates among certain groups.
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Energy

Affordable Homes Waiver of Connect Fees Incentive   

Connect fees may be waived or refunded to the home builder
The Builder must submit proof of the home’s certification from a non-profit or government agency that the home is eligible for “affordable” incentives at the time the service request is made; The builder must enroll the home in MLGW’s EcoBuild program; The home must be an individual single-family home or duplex; The maximum sale price shall be $140,000.

Promote non-profit and governmental agency efforts to produce affordable dwelling units.




Allows the waiver of electric utility deposits for a limited time
TVA and MLGW will purchase insurance coverage for the electric utility deposit requirement for a term of five years. After year two of the term, coverage will decline 25 percent each year. Program is available to new or expanding creditworthy commercial and industrial customers through a partnership between TVA and MLGW. Requires at least 25 employees and an average monthly power usage exceeding 250 kilowatts.

Created to support commercial and industrial companies’ efforts to be more competitive by freeing up valuable capital as they locate or expand in the region.




Allows an additional 50% revenue allowance over MLGW’s standard policy for costumers located downtown
Eligible customers include developers, residential and commercial. The target area is bounded by Chelsea, Danny Thomas, Crump Blvd and the Mississippi River. These additional incentives are only for revenue extensions

Created to promote use of MLGW’s installed capacity in the downtown area.




Provides below market rate loans to help implement projects that reduce energy use, improve cash flow and provide a new opportunity for growth
Financing is available for up to 100 percent of the costs for installing energy efficient technology, energy retrofits and renewable energy systems that will help them reduce energy consumption. Loans are offered up to 5 million dollars. Eligible projects include: Lighting, HVAC, Building Retrofits, Industrial Systems, Co-Generation, and Renewable Energy/Solar Projects.

Created to help businesses and industries become more energy efficient, so that they may increase their competitiveness and strengthen Tennessee’s economy.



Tax credit against franchise and excise taxes for companies involved in producing green technology
Must be a certified green energy supply chain manufacturer or affiliated company. "Certified green energy supply chain manufacturer? means any manufacturer that has made during the investment period a required capital investment in excess of $250 million in constructing, expanding, or remodeling a facility that is certified to be a facility engaged in manufacturing a product that is necessary for the production of green energy.

Green Energy Tax Credit was developed as a part of a comprehensive strategy to encourage green energy projects to locate in Tennessee.




Green Power Providers Program    
Green Power Providers participants are eligible for a federal tax credit that can mean substantial savings on their tax bills
Tennessee Valley Authority (TVA) and participating power distributors of TVA power offer a performance-based incentive program to homeowners and businesses for the installation of renewable generation systems from the following qualifying resources: PV, wind, hydropower, and biomass; Eligible Systems must not have previously generated renewable energy for sale to TVA prior to October 1, 2012, unless the system was part of the Generation Partners pilot; Qualifying systems will have a minimum total nameplate generation capacity (DC) of 500 watts (W) and a maximum of 50 kilowatts (kW). Systems over 50kW may qualify to participate in TVA’s Mid-Sized Renewable Standard Offer program (link to DSIRE summary). Systems greater than 10 kilowatts in size will be subject to a load requirement.

The purpose of the Green Power Providers program is to continue to increase the renewable energy supply in the Tennessee Valley region.



Sales and Use Tax Credit for Emerging Industries   
A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.

Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.




Solar Energy Systems Tax Credit    
Businesses are eligible for tax credits for qualified solar water heating and photovoltaic systems, and for certain solar lighting systems; The tax credits are for 30% of the cost of the system
The tax credits go to businesses that install solar equipment for their use, and to individuals who install qualifying systems on homes they use as a residence (unlike other consumer incentives, the dwelling does not have to be the taxpayer's primary residence - second homes are eligible, although rental properties are not); Note: The credits are available for systems "placed in service" between January 1, 2006 and December 31, 2016;

Developed to encourage energy efficient consumers, businesses and practices.
 


 
Monthly power bill credits to qualifying power customers who contribute to the economic development of the Tennessee Valley
Award amounts based on capital investment, jobs added or retained, average wages paid, and annual load factor. Requires at 250-kilowatt peak monthly demand, and minimum of 25 employees with no plans to reduce workforce by 50 percent or more. Must commit to a projected five-year capital investment of 25 percent of an existing facility?s book value, or $2.5 million in a new facility. Requires standard power contract with a remaining term at least as long as the five- or eight-year VII award period.

Created to lower energy costs for companies that contribute to economic growth.
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Environmental

 

Provides below market rate loans to help implement projects that reduce energy use, improve cash flow and provide a new opportunity for growth
Financing is available for up to 100 percent of the costs for installing energy efficient technology, energy retrofits and renewable energy systems that will help them reduce energy consumption. Loans are offered up to 5 million dollars. Eligible projects include: Lighting, HVAC, Building Retrofits, Industrial Systems, Co-Generation, and Renewable Energy/Solar Projects.

Created to help businesses and industries become more energy efficient, so that they may increase their competitiveness and strengthen Tennessee’s economy.




Green Energy Tax Credit    
Tax credit against franchise and excise taxes for companies involved in producing green technology
Must be a certified green energy supply chain manufacturer or affiliated company. "Certified green energy supply chain manufacturer? means any manufacturer that has made during the investment period a required capital investment in excess of $250 million in constructing, expanding, or remodeling a facility that is certified to be a facility engaged in manufacturing a product that is necessary for the production of green energy.

Green Energy Tax Credit was developed as a part of a comprehensive strategy to encourage green energy projects to locate in Tennessee.




Green Power Providers participants are eligible for a federal tax credit that can mean substantial savings on their tax bills
Tennessee Valley Authority (TVA) and participating power distributors of TVA power offer a performance-based incentive program to homeowners and businesses for the installation of renewable generation systems from the following qualifying resources: PV, wind, hydropower, and biomass; Eligible Systems must not have previously generated renewable energy for sale to TVA prior to October 1, 2012, unless the system was part of the Generation Partners pilot; Qualifying systems will have a minimum total nameplate generation capacity (DC) of 500 watts (W) and a maximum of 50 kilowatts (kW). Systems over 50kW may qualify to participate in TVA’s Mid-Sized Renewable Standard Offer program (link to DSIRE summary). Systems greater than 10 kilowatts in size will be subject to a load requirement.

The purpose of the Green Power Providers program is to continue to increase the renewable energy supply in the Tennessee Valley region.




Tax credit for the purchase of government-mandated pollution control equipment
Purchases of pollution control equipment that is mandated by state, federal or local law and that results in the reduction of water and/or air pollution or the elimination of hazardous waste qualify for tax credits such as exemption from franchise and sales and use taxes among other incentives. Tax credit applies to purchases of pollution control equipment for manufacturers.

Created to alleviate the burden of pollution regulations on industry.




Solar Energy Systems Tax Credit    
Businesses are eligible for tax credits for qualified solar water heating and photovoltaic systems, and for certain solar lighting systems; The tax credits are for 30% of the cost of the system
The tax credits go to businesses that install solar equipment for their use, and to individuals who install qualifying systems on homes they use as a residence (unlike other consumer incentives, the dwelling does not have to be the taxpayer's primary residence - second homes are eligible, although rental properties are not); Note: The credits are available for systems "placed in service" between January 1, 2006 and December 31, 2016;

Developed to encourage energy efficient consumers, businesses and practices.

 

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Exports

FastTrack Infrastructure Development Program   

Funds for public infrastructure improvements to facilitate business development
Local community must apply with commitment from specific private-sector company. Qualifying projects must involve companies engaging in manufacturing or other economic activities beneficial to the state of Tennessee. Companies for whom more than 50% of the product or service is involved in the manufacture of products for export are also eligible. FIDP grants require local community matching funds calculated along a varying scale based on a community's ability to pay.
Created to encourage companies to locate or expand in certain communitites, and to create or retain jobs for Tennesseans.



 
Allows businesses in designated Foreign Trade Zones to process foriegn goods prior to formal Customs entry, deffering or eliminating duties
Duty-free treatment is accorded items that are reexported and duty payment is deferred on items sold in the U.S. market, thus offsetting Customs advantages available to overseas producers who compete with producers located in the United States. The City of Memphis is the Grantee of Foreign-Trade Zone (FTZ) No. 77 that includes sites at the Port of Memphis, several sites in southeast Memphis, and the Memphis Depot Business Park.
Established under a 1934 federal act to encourage foreign trade and to create and retain American-based jobs.




Industrial Revenue Bonds   
Bonds issued by public entities to fund the construction or renovation of manufacturing facilities
The bonds are issued by public entities on behalf of private, for-profit companies. The bond buyers provide the funds needed by the company. Interest earned by the bond buyers is exempt from federal (and some state) income tax. As a result, the bond buyers are willing to accept a lower interest rate. Funds must be used to acquire land/buildings, construct facilities, renovate facilities, or acquire new or used equipment. Minimum of 70% must go to core manufacturing.
Developed to allow public entities to leverage capital to fund targeted development in the manufacturing sector.
 
 
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General Incentives

Economic Gardening Program    

Guides businesses through economic gardening program
This incentive is being tested with a pilot of 22 businesses in Memphis but may expand in the future. Focuses on growth-minded stage-2 businesses with revenue between $1 and $50 million, and 10 to 100 employees. The economic gardening program provides technical assistance to develop and expand existing local businesses with growth potential.
Being developed to fill the gap of technical assistance for existing small businesses looking to expand.




Provides grant funding for customized training for existing for-profit and not-for-profit (healthcare related) businesses that result in layoff aversion
For profit businesses, and not-for-profit healthcare businesses are eligible to apply. Note: 1) The grant period is October 1st through September 30th; 2) The application deadline for the 2012-2013 grants is October 31st, 2012; 3) Applicant must be in business one year prior to submitting an application; 4) Applicant must employ a minimum of five full time employees (independent contractor/1099 employees are not eligible for training); 5) Applicant must be current on all federal and state taxes; 6) Maximum award is $25,000 per grant, with a total funding limit of $50,000 per employer in consecutive program years; and 7) A 50% employer match is required.
Developed to help existing for-profit and not-for-profit (healthcare related) businesses avoid employee layoffs.




WIN contracts with businesses in the public, private non-profit, and private sectors to provide On-the-Job Training (OJT) to eligible WIN participants; Depending upon the details of the agreement, businesses may be reimbursed up to 50% of the trainee’s wage during the training period
Participation requirements are as follows: 1) The job seeker must be eligible for training through the Workforce Investment Act, i.e. either unemployed or underemployed (defined as not earning a self-sufficiency wage of $15 or more per hour); 2) The employer must be willing to provide OJT participants with continued long-term, full-time employment (with wages, benefits, and working conditions that are equal to those provided to regular employees who have worked a similar length of time and are doing the same type of work); 3) An OJT contract must be limited to the period of time required for a participant to become proficient in the occupation for which the training is being provided. In determining the appropriate length of the contract, consideration should be given to the skill requirements of the occupation, the academic and occupational skill level of the participant, prior work experience, and the participant’s individual employment plan.
Developed so that employers can remain competitive and the State of Tennessee can produce viable, progressive businesses.




Tax abatement of up to 90% of city personal and property taxes and 75% of county personal and property taxes for a maximum of 15 years
Amount of abatement is determined by capital investment, number of new jobs, average wage of new jobs, location of project, diversity plan, environmental plan, and industry. To be considered, companies must have a minimum capital investment of $1 million and hire add at least 15 new jobs at an average salary of $10 or more per hour. Retention PILOTs require a minimum capital investment of $10 million and the creation of at least 100 new jobs.
Created to alleviate the burden of start-up and relocation expenditures.



 
Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time
The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here: http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf)
The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.



Sales and Use Tax Credit for Emerging Industries   
A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.
Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.



Monthly power bill credits to qualifying power customers who contribute to the economic development of the Tennessee Valley
Award amounts based on capital investment, jobs added or retained, average wages paid, and annual load factor. Requires at 250-kilowatt peak monthly demand, and minimum of 25 employees with no plans to reduce workforce by 50 percent or more. Must commit to a projected five-year capital investment of 25 percent of an existing facility?s book value, or $2.5 million in a new facility. Requires standard power contract with a remaining term at least as long as the five- or eight-year VII award period.
Created to lower energy costs for companies that contribute to economic growth.
 
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High-tech

Data Center Tax Credit   

Tax credit for the purchase of materials related to the construction of a data center
Applies to buildings housing high technology computer systems and related equipment in which the taxpayers had made a minimum capital investment of $250 million and has created 25 new jobs paying at least 150% of the state's average occupational wage. Investments must be made during a 3 year period, but can be extended to 7 years at the discretion of the Commissioner of Economic and Community Development; The purchase of computers, computer systems, computer software and repair parts for a qualified data center are considered purchases of industrial machinery and qualify for a minimum 5% Industrial Machinery Tax Credit against F&E liability. Computers, computer systems, computer software and repair parts used in qualified data centers are classified as industrial machinery and exempt from sales and use taxes. Qualified data centers also pay reduced sales taxes on the purchase of electricity (1.5% vs. the previous rate of 7%).

Created to assist expanding and emerging tech companies with expansion.



Tax credit against franchise and excise taxes for companies involved in producing green technology
Must be a certified green energy supply chain manufacturer or affiliated company. "Certified green energy supply chain manufacturer? means any manufacturer that has made during the investment period a required capital investment in excess of $250 million in constructing, expanding, or remodeling a facility that is certified to be a facility engaged in manufacturing a product that is necessary for the production of green energy.

Green Energy Tax Credit was developed as a part of a comprehensive strategy to encourage green energy projects to locate in Tennessee.



Sales and Use Tax Credit for Emerging Industries   
A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.

Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.



Tennessee Job Skills   
A special training reimbursement program for emerging, high-demand, and technology focused businesses
Similar to FJTAP, but with a focus on employers and industries that create high-skill, high-wage jobs in emerging, high-demand and technology focused sectors of the economy. Training staff work with companies to develop a unique, flexible, comprehensive training plans that meet the company's initial training needs and follow up to ensure each phase of the program meets the company's needs. Companies track costs and apply to the State for reimbursement. Reimbursement rates depend on the level of training and the types of instructors utilized.

Created to assist companies in hiring new employees.
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Housing Development

Affordable Apartment Rental Additional Unit Allowance

Apply an additional 50% revenue allowance over MLGW’s standard policy

The developer must submit documentation proving that the particular apartment development is recognized as a low income development by the appropriate nonprofit or government agency. The builder must also enroll the apartment development in MLGW’s EcoBuild program.

Promote development of apartments for affordable rental housing.


Affordable Homes Waiver of Connect Fees Incentive

Connect fees may be waived or refunded to the home builder

The Builder must submit proof of the home’s certification from a non-profit or government agency that the home is eligible for “affordable” incentives at the time the service request is made; The builder must enroll the home in MLGW’s EcoBuild program; The home must be an individual single-family home or duplex; The maximum sale price shall be $140,000.

Promote non-profit and governmental agency efforts to produce affordable dwelling units.


Affordable Housing Additional Lot Allowance Incentive

Apply an additional 50% lot allowance over MLGW’s standard policy

The developer must submit documentation proving that the particular development is recognized as a low income development by the appropriate nonprofit or government agency; At least fifty percent (50%) of the homes in the development must meet affordable housing criteria; The homes must meet EcoBuild criteria; The homes shall not exceed $140,000 in price.

Promote development of lots for affordable housing.


BUILD Loan Program

Low interest short term loans available to nonprofit organizations that help meet the housing needs of low and very low income households

The loans may be secured or unsecured depending on the proposed activity. BUILD Loan funds must be used for operating and program expenses incurred to create affordable housing opportunities for low and very low-income households. Eligible activities may include: 1) Development of single and multi-family units for homeownership or rental, 2) Construction, 3) Land Acquisition, 4) Site Preparation, 5) Pre-Development.

The purpose of the BUILD Loan Program is to promote the production, preservation, and rehabilitation of housing for low and very low income households.


Community Investment Tax Credit

Provides a tax credit to financial institutions when loans, qualified investments, grants or contributions are made to organizations involved in developing low income housing

Eligible Activities are as follows: 1) Activities that create or preserve affordable housing for low income Tennesseans, 2) Activities that assist low income Tennesseans in obtaining safe and affordable housing, 3) Activities that build the capacity of an eligible non-profit organization to provide housing opportunities for low-income Tennesseans, and 4) Any other low-income housing related activity approved by the THDA Executive Director and the Commissioner of Revenue. Eligible Housing Entities are as follows: 1) Tennessee based non-profit organizations with an Internal Revenue Code 501 (C)(3) status, 2) Public Housing Authorities, 3) Development Districts, and 4) Tennessee Housing Development Agency.

Developed to increase low income housing development.


Health, Education and Housing Facility Board PILOT

Property tax freeze for new or rehabilitated affordable housing units

To be eligible for a PILOT, the value of the building renovations, site improvements or new construction must be equal to or greater than 50% of the property acquisition cost. 20% of the Applicant?s units must be occupied by individuals whose income is 50% or less of the median gross income or 40% or more of the units must be occupied by individuals whose income is 60% or less of the median gross income. The project's primary use must be affordable multi-family residential within the limits of the City of Memphis containing a minimum of 24 units. The total project cost for new construction must be at least $1,000,000; and for acquisition/ rehabilitation projects must be at least $750,000. Priority is given to development projects located in Target Areas, as defined by the City, at the time of the application.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.


Health, Educational and Housing Facility Board Bonds

Bonds for the building and rehabilitation of affordable housing

Project must consist of the acquisition of land or the acquisition, rehabilitation, construction or improvement of affordable housing, typically multifamily residential units. Either at least 20% of the units in the Project must be rented to individuals whose income is 50% or less of the Median Gross Income for Memphis, or at least 40% of the units in the Project must be rented to individuals whose income is 60% or less of the Median Gross Income. Except for those Units rented to the elderly or handicapped, units must be rented either to tenants earning less than 150% of the Median Gross Income, or at a rental rate less than 30% of 150% of the Median Gross Income for Memphis.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.


HOME Program

Provides funds to cities and community housing development organizations for the construction, aquisition, rehabilitation, or financing of affordadble housing

HOME funds are awarded through a competitive application process to cities, counties and non-profit organizations outside local participating jurisdictions. Memphis is a participating jurisdiction. An applicant must apply for at least $100,000 and may apply for a maximum HOME grant of $500,000. There is a $750,000 limit on the amount of HOME funds that can be awarded to any one county. Eligable activities include homeowner rehabilitation programs, homeownership programs, and rental housing programs.

Created to promote the production, preservation and rehabilitation of housing for low-income households.


Investment Tax Credit

Provides a tax credit for the rehabilitation of historic buildings

There are two types of ITCs available: 20% for a certified historic structure or 10% for a non-historic structure. The historic property must be income producing. To qualify for the 20% credit, the building must be listed on the National Register of Historic Places, or listed as a contributing structure within a National Register Historic District. The rehabilitation project must meet the "substantial rehabilitation test," which means the owner must spend the adjusted value of the building or $5000, whichever is greater.To qualify for the 10% credit, the structure must have been built before 1936 and must not be listed or eligible for listing on the National Register of Historic Places, the structure must retain 50-70% of external walls and 75% of internal walls, the rehabilitation must meet the "substantial rehabilitation test" as in the 20% credit, and the structure must be used for five years as an income producing property but not as housing.

Created to encourage the rehabilitation of historic buildings.


Low-Income Housing Tax Credit

Offers a credit against federal income tax liability each year for 10 years for owners of and investors in affordable rental housing

An indirect Federal subsidy used to finance the development of affordable rental housing for low-income households. To be eligible for consideration under the LIHTC Program, a proposed project must: 1) Be a residential rental property, 2) Commit to one of two possible low-income occupancy threshold requirements, 3) Restrict rents, including utility charges, in low-income units, 4) Operate under the rent and income restrictions for 30 years or longer, pursuant to written agreements with the agency issuing the tax credits.

Created by Congress to generate equity capital for the construction and rehabilitation of affordable rental housing.


Multifamily Tax-Exempt Bond Authority Program

THDA is making Multifamily Tax-Exempt Bond Authority available to local issuers for financing for multifamily housing units in Tennessee

The Multifamily Tax-Exempt Bond Authority can be used only to provide financing for new construction of affordable rental housing units, for conversion of existing properties through adaptive reuse, or for acquisition and rehabilitation of rental units. The development must be: 1) New construction, 2) A conversion of an existing property not being used for housing, or 3) Acquisition and rehabilitation.

Created to ensure the development of low-income housing.


Solar Energy Systems Tax Credit

Businesses are eligible for tax credits for qualified solar water heating and photovoltaic systems, and for certain solar lighting systems; The tax credits are for 30% of the cost of the system

The tax credits go to businesses that install solar equipment for their use, and to individuals who install qualifying systems on homes they use as a residence (unlike other consumer incentives, the dwelling does not have to be the taxpayer's primary residence - second homes are eligible, although rental properties are not); Note: The credits are available for systems "placed in service" between January 1, 2006 and December 31, 2016;

Developed to encourage energy efficient consumers, businesses and practices.


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Industrial

Economic Development Funds   

Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects
The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.




Foreign Trade Zone (FTZ)   
Allows businesses in designated Foreign Trade Zones to process foriegn goods prior to formal Customs entry, deffering or eliminating duties
Duty-free treatment is accorded items that are reexported and duty payment is deferred on items sold in the U.S. market, thus offsetting Customs advantages available to overseas producers who compete with producers located in the United States. The City of Memphis is the Grantee of Foreign-Trade Zone (FTZ) No. 77 that includes sites at the Port of Memphis, several sites in southeast Memphis, and the Memphis Depot Business Park.

Established under a 1934 federal act to encourage foreign trade and to create and retain American-based jobs.

 


Impact and Grow America Fund Programs   
Provides expansion loans to established businesses with an emphasis on manufacturers and distributors
Loan proceeds may be used for any legitimate business purpose, including working capital machinery and equipment, property acquisitions and construction (building renovations ore leasehold improvements). To be considered, the business must be operating for at least 18 months and be in good financial standing. EDGE Impact Fund requires, at a minimum: 2009, 2010 and 2011 tax returns; year-end and current interim 2012 financial statements; and current business debt schedule. Loan size is $150,000 ? $2 million. Interest rates are based on floating, risk-based pricing. Fixed rates are available. Repayment terms vary based on use of funds (including refinance).

Created to promote the expansion of existing businesses, particularly manufacturers and distributors.




Tax credit of up to 50% of franchise and excise tax liability for purchasing, installing, or repairing industrial machinery
The credit applies to the purchase, installation and repair of industrial machinery as defined in T.C.A. 67-6-102. The credit also applies to the purchase and installation of computer, computer software and certain peripheral devices purchased in order to meet the capital investment thresholds of the Job Tax Credit. Any unused Industrial Machinery Tax Credit may be carried forward for up to 15 years. The percentage of Industrial Machinery Credit allowed is dependent upon the investment made during the investment period, from 1% to 10%.

Created to encourage capital investments in industrial machinery.


Bonds issued by public entities to fund the construction or renovation of manufacturing facilities
The bonds are issued by public entities on behalf of private, for-profit companies. The bond buyers provide the funds needed by the company. Interest earned by the bond buyers is exempt from federal (and some state) income tax. As a result, the bond buyers are willing to accept a lower interest rate. Funds must be used to acquire land/buildings, construct facilities, renovate facilities, or acquire new or used equipment. Minimum of 70% must go to core manufacturing.

Developed to allow public entities to leverage capital to fund targeted development in the manufacturing sector.
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Infrastructure

Economic Gardening Program    

Guides businesses through economic gardening program.
This incentive is being tested with a pilot of 22 businesses in Memphis but may expand in the future. Focuses on growth-minded stage-2 businesses with revenue between $1 and $50 million, and 10 to 100 employees. The economic gardening program provides technical assistance to develop and expand existing local businesses with growth potential.

Being developed to fill the gap of technical assistance for existing small businesses looking to expand.



Funds for public infrastructure improvements to facilitate business development.
Local community must apply with commitment from specific private-sector company. Qualifying projects must involve companies engaging in manufacturing or other economic activities beneficial to the state of Tennessee. Companies for whom more than 50% of the product or service is involved in the manufacture of products for export are also eligible. FIDP grants require local community matching funds calculated along a varying scale based on a community's ability to pay.
Created to encourage companies to locate or expand in certain communitites, and to create or retain jobs for Tennesseans.




Provides economically distressed counties with loans for industrial expansion, relocation, retention, and infrastructure development.
Only counties with the lowest per capita personal income, the highest percentage of residents below the poverty level, and the highest annual average unemployment rates are eligible for this program. SOC loans are made for buildings, plant equipment, infrastructure, or real estate based on the capital investment leveraged and the number of jobs created by a venture. SOC loans can also be made to local economic development entities for capacity-building projects such as sites or buildings. View a map of the Special Opportunities Counties, here (http://www.tvaed.com/pdf/soc_counties.pdf).

Created to spur growth in economically distressed counties.
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Renovations

Affordable Housing Additional Lot Allowance Incentive

Apply an additional 50% lot allowance over MLGW’s standard policy

The developer must submit documentation proving that the particular development is recognized as a low income development by the appropriate nonprofit or government agency; At least fifty percent (50%) of the homes in the development must meet affordable housing criteria; The homes must meet EcoBuild criteria; The homes shall not exceed $140,000 in price.

Promote development of lots for affordable housing.


BUILD Loan Program

Low interest short term loans available to nonprofit organizations that help meet the housing needs of low and very low income households

The loans may be secured or unsecured depending on the proposed activity. BUILD Loan funds must be used for operating and program expenses incurred to create affordable housing opportunities for low and very low-income households. Eligible activities may include: 1) Development of single and multi-family units for homeownership or rental, 2) Construction, 3) Land Acquisition, 4) Site Preparation, 5) Pre-Development.

The purpose of the BUILD Loan Program is to promote the production, preservation, and rehabilitation of housing for low and very low income households.


Commercial Office Grant Program for Tenant Improvements

Offers eligible tenants matching grants for up to 50% of the cost of tenant improvements

The property or lease space must be located within the Central Business Improvement District; The Tenant must be classified as and determined as being an office tenant with an office use and with employees who work within the leased premises or within the CBID; The Tenant must employ at least three (3) full-time employees/equivalents (FTEs) at the eligible location; The Tenant must apply prior to entering into a lease; The Tenant’s current lease (if applicable) must be due to expire within 12 months of the application date; and, The Tenant must sign a lease that includes a term of at least five (5) years. *Note: Retail tenants are ineligible for the Program.

This program is designed to stabilize and strengthen the Downtown office market by increasing the number of full-time employees/equivalents within the area.


Community Investment Tax Credit

Provides a tax credit to financial institutions when loans, qualified investments, grants or contributions are made to organizations involved in developing low income housing

Eligible Activities are as follows: 1) Activities that create or preserve affordable housing for low income Tennesseans, 2) Activities that assist low income Tennesseans in obtaining safe and affordable housing, 3) Activities that build the capacity of an eligible non-profit organization to provide housing opportunities for low-income Tennesseans, and 4) Any other low-income housing related activity approved by the THDA Executive Director and the Commissioner of Revenue. Eligible Housing Entities are as follows: 1) Tennessee based non-profit organizations with an Internal Revenue Code 501 (C)(3) status, 2) Public Housing Authorities, 3) Development Districts, and 4) Tennessee Housing Development Agency.

Developed to increase low income housing development.


Data Center Tax Credit

Tax credit for the purchase of materials related to the construction of a data center

Applies to buildings housing high technology computer systems and related equipment in which the taxpayers had made a minimum capital investment of $250 million and has created 25 new jobs paying at least 150% of the state's average occupational wage. Investments must be made during a 3 year period, but can be extended to 7 years at the discretion of the Commissioner of Economic and Community Development; The purchase of computers, computer systems, computer software and repair parts for a qualified data center are considered purchases of industrial machinery and qualify for a minimum 5% Industrial Machinery Tax Credit against F&E liability. Computers, computer systems, computer software and repair parts used in qualified data centers are classified as industrial machinery and exempt from sales and use taxes. Qualified data centers also pay reduced sales taxes on the purchase of electricity (1.5% vs. the previous rate of 7%).

Created to assist expanding and emerging tech companies with expansion.


Development Loan Program

Offers low-interest loans to finance building renovations in downtown area

Low-interest loan program offers up to $90,000 for building renovations based on established project evaluation criteria. The loan is amortized over a 20 year period at a three percent (3%) interest rate with a balloon payment due at the end of the tenth (10th) year. The Development Loan Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID), which is bound by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center which is bound by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas on the west.

Designed to encourage commercial real estate development within the Central Business Improvement District.


Downtown Storefront Improvement Grant

The Storefront Improvement Grant provides businesses in the Central Business Improvement District (CBID) with financial assistance in the procurement of façade upgrades that will enhance the appearance and functionality of business storefronts

Limited to businesses that occupy first-floor space with an active street presence and maintain regular daily business hours. The grant can only be used for exterior improvements and approved accessories that are visible from the public right-of-way.

This matching grant is designed to create more attractive, inviting Downtown storefronts in order to improve the public realm and pedestrian experience Downtown.


Economic Development Funds

Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects

The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.


Energy Efficiency Loan Program

Provides below market rate loans to help implement projects that reduce energy use, improve cash flow and provide a new opportunity for growth

Financing is available for up to 100 percent of the costs for installing energy efficient technology, energy retrofits and renewable energy systems that will help them reduce energy consumption. Loans are offered up to 5 million dollars. Eligible projects include: Lighting, HVAC, Building Retrofits, Industrial Systems, Co-Generation, and Renewable Energy/Solar Projects.

Created to help businesses and industries become more energy efficient, so that they may increase their competitiveness and strengthen Tennessee’s economy.


Health, Education and Housing Facility Board PILOT

Property tax freeze for new or rehabilitated affordable housing units

To be eligible for a PILOT, the value of the building renovations, site improvements or new construction must be equal to or greater than 50% of the property acquisition cost. 20% of the Applicant?s units must be occupied by individuals whose income is 50% or less of the median gross income or 40% or more of the units must be occupied by individuals whose income is 60% or less of the median gross income. The project's primary use must be affordable multi-family residential within the limits of the City of Memphis containing a minimum of 24 units. The total project cost for new construction must be at least $1,000,000; and for acquisition/ rehabilitation projects must be at least $750,000. Priority is given to development projects located in Target Areas, as defined by the City, at the time of the application.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.


Health, Educational and Housing Facility Board Bonds

Bonds for the building and rehabilitation of affordable housing

Project must consist of the acquisition of land or the acquisition, rehabilitation, construction or improvement of affordable housing, typically multifamily residential units. Either at least 20% of the units in the Project must be rented to individuals whose income is 50% or less of the Median Gross Income for Memphis, or at least 40% of the units in the Project must be rented to individuals whose income is 60% or less of the Median Gross Income. Except for those Units rented to the elderly or handicapped, units must be rented either to tenants earning less than 150% of the Median Gross Income, or at a rental rate less than 30% of 150% of the Median Gross Income for Memphis.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.


HOME Program

Provides funds to cities and community housing development organizations for the construction, aquisition, rehabilitation, or financing of affordadble housing

HOME funds are awarded through a competitive application process to cities, counties and non-profit organizations outside local participating jurisdictions. Memphis is a participating jurisdiction. An applicant must apply for at least $100,000 and may apply for a maximum HOME grant of $500,000. There is a $750,000 limit on the amount of HOME funds that can be awarded to any one county. Eligable activities include homeowner rehabilitation programs, homeownership programs, and rental housing programs.

Created to promote the production, preservation and rehabilitation of housing for low-income households.


Industrial Machinery Tax Credit

Tax credit of up to 50% of franchise and excise tax liability for purchasing, installing, or repairing industrial machinery

The credit applies to the purchase, installation and repair of industrial machinery as defined in T.C.A. 67-6-102. The credit also applies to the purchase and installation of computer, computer software and certain peripheral devices purchased in order to meet the capital investment thresholds of the Job Tax Credit. Any unused Industrial Machinery Tax Credit may be carried forward for up to 15 years. The percentage of Industrial Machinery Credit allowed is dependent upon the investment made during the investment period, from 1% to 10%.

Created to encourage capital investments in industrial machinery.


Investment Tax Credit

Provides a tax credit for the rehabilitation of historic buildings

There are two types of ITCs available: 20% for a certified historic structure or 10% for a non-historic structure. The historic property must be income producing. To qualify for the 20% credit, the building must be listed on the National Register of Historic Places, or listed as a contributing structure within a National Register Historic District. The rehabilitation project must meet the "substantial rehabilitation test," which means the owner must spend the adjusted value of the building or $5000, whichever is greater.To qualify for the 10% credit, the structure must have been built before 1936 and must not be listed or eligible for listing on the National Register of Historic Places, the structure must retain 50-70% of external walls and 75% of internal walls, the rehabilitation must meet the "substantial rehabilitation test" as in the 20% credit, and the structure must be used for five years as an income producing property but not as housing.

Created to encourage the rehabilitation of historic buildings.


Low-Income Housing Tax Credit

Offers a credit against federal income tax liability each year for 10 years for owners of and investors in affordable rental housing

An indirect Federal subsidy used to finance the development of affordable rental housing for low-income households. To be eligible for consideration under the LIHTC Program, a proposed project must: 1) Be a residential rental property, 2) Commit to one of two possible low-income occupancy threshold requirements, 3) Restrict rents, including utility charges, in low-income units, 4) Operate under the rent and income restrictions for 30 years or longer, pursuant to written agreements with the agency issuing the tax credits.

Created by Congress to generate equity capital for the construction and rehabilitation of affordable rental housing.


Multifamily Tax-Exempt Bond Authority Program

THDA is making Multifamily Tax-Exempt Bond Authority available to local issuers for financing for multifamily housing units in Tennessee

The Multifamily Tax-Exempt Bond Authority can be used only to provide financing for new construction of affordable rental housing units, for conversion of existing properties through adaptive reuse, or for acquisition and rehabilitation of rental units. The development must be: 1) New construction, 2) A conversion of an existing property not being used for housing, or 3) Acquisition and rehabilitation.

Created to ensure the development of low-income housing.


New Markets Tax Credit Program

Allows individual and corporate investors to receive a tax credit for making equity investments in Community Development Financial Insitutions

The credit totals 39 percent of the original investment amount and is claimed over a period of seven years. Equity investment must be made in Community Development Entity certified by the US Treasury. CDIs provide investment capital for low-income communities or low-income persons.

Established by Congress in 2000 to spur new or increased investments into operating businesses and real estate projects located in low-income communities.


PILOT (Payment-In-Lieu-of Tax) or Tax-Freeze Program

Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time

The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here: http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf)

The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.


Pollution Control Equipment Tax Credit

Tax credit for the purchase of government-mandated pollution control equipment

Purchases of pollution control equipment that is mandated by state, federal or local law and that results in the reduction of water and/or air pollution or the elimination of hazardous waste qualify for tax credits such as exemption from franchise and sales and use taxes among other incentives. Tax credit applies to purchases of pollution control equipment for manufacturers.

Created to alleviate the burden of pollution regulations on industry.


Special Opportunities Counties Fund

Provides economically distressed counties with loans for industrial expansion, relocation, retention, and infrastructure development

Only counties with the lowest per capita personal income, the highest percentage of residents below the poverty level, and the highest annual average unemployment rates are eligible for this program. SOC loans are made for buildings, plant equipment, infrastructure, or real estate based on the capital investment leveraged and the number of jobs created by a venture. SOC loans can also be made to local economic development entities for capacity-building projects such as sites or buildings. View a map of the Special Opportunities Counties, here (http://www.tvaed.com/pdf/soc_counties.pdf).

Created to spur growth in economically distressed counties.


BACK

Startup and Relocation

Commercial Office Grant Program for Tenant Improvements   

Offers eligible tenants matching grants for up to 50% of the cost of tenant improvements
The property or lease space must be located within the Central Business Improvement District; The Tenant must be classified as and determined as being an office tenant with an office use and with employees who work within the leased premises or within the CBID; The Tenant must employ at least three (3) full-time employees/equivalents (FTEs) at the eligible location; The Tenant must apply prior to entering into a lease; The Tenant’s current lease (if applicable) must be due to expire within 12 months of the application date; and, The Tenant must sign a lease that includes a term of at least five (5) years. *Note: Retail tenants are ineligible for the Program.

This program is designed to stabilize and strengthen the Downtown office market by increasing the number of full-time employees/equivalents within the area.




Tax credit for the purchase of materials related to the construction of a data center
Applies to buildings housing high technology computer systems and related equipment in which the taxpayers had made a minimum capital investment of $250 million and has created 25 new jobs paying at least 150% of the state's average occupational wage. Investments must be made during a 3 year period, but can be extended to 7 years at the discretion of the Commissioner of Economic and Community Development; The purchase of computers, computer systems, computer software and repair parts for a qualified data center are considered purchases of industrial machinery and qualify for a minimum 5% Industrial Machinery Tax Credit against F&E liability. Computers, computer systems, computer software and repair parts used in qualified data centers are classified as industrial machinery and exempt from sales and use taxes. Qualified data centers also pay reduced sales taxes on the purchase of electricity (1.5% vs. the previous rate of 7%).

Created to assist expanding and emerging tech companies with expansion.




Extends the term of the PILOT program for those who hire minority employees or contractors
All PILOT companies must file a Diversity Plan with the industrial development board, but those which meet or exceed all of the goals of the Diversity Plan may extend the PILOT by one or two years at the discretion of the Industrial Development Board.

Created to encourage the support and inclusion of minority, women, and locally owned small businesses in the economic development of the local community.




Downtown Storefront Improvement Grant   
The Storefront Improvement Grant provides businesses in the Central Business Improvement District (CBID) with financial assistance in the procurement of façade upgrades that will enhance the appearance and functionality of business storefronts
Limited to businesses that occupy first-floor space with an active street presence and maintain regular daily business hours. The grant can only be used for exterior improvements and approved accessories that are visible from the public right-of-way.

This matching grant is designed to create more attractive, inviting Downtown storefronts in order to improve the public realm and pedestrian experience Downtown.



Economic Development Funds   
Offers below-market-rate financing for capital-intensive industrial and nonprofit construction and renovation projects
The maximum loan amount varies according to the type of project. In most instances, TVA funds should be used for the acquisition of fixed assets. Loans are typically below market rate, with specific rates to be determined on a case-by-case basis after consideration of the loan evaluation criteria. Program guidelines require that each TVA loan dollar leverage additional funding from other sources. The loan funds are primarily available to manufacturing companies and local nonprofit economic development entities. Loans can be used to fund the construction of new manufacturing facilities, expansion of existing facilities, and development of publicly owned industrial sites or buildings.

Established to stimulate economic development and leverage capital investment in the TVA power service area.




Provides below market rate loans to help implement projects that reduce energy use, improve cash flow and provide a new opportunity for growth
Financing is available for up to 100 percent of the costs for installing energy efficient technology, energy retrofits and renewable energy systems that will help them reduce energy consumption. Loans are offered up to 5 million dollars. Eligible projects include: Lighting, HVAC, Building Retrofits, Industrial Systems, Co-Generation, and Renewable Energy/Solar Projects.

Created to help businesses and industries become more energy efficient, so that they may increase their competitiveness and strengthen Tennessee’s economy.




Reimburses up to 100% of eligible job training expenses for new or expanding companies, and assists with development of training plans
This incentive is available to both new and expanding industry and begins with a company developing a training plan including the number of people to be hired, types of skills required and types of training needed. The plan is developed in conjunction with the FastTrack staff and is designed to be customizable and flexible. Companies will track costs associated with implementation of the training program, then submit to the state for reimbursement. Job training assistance can include either traditional or job based training reimbursement.

Created to assist companies in training new employees.




Headquarters Relocation Expense Credit   
Tax credit against expenses incurred in relocating a headquarters
Companies establishing a qualified headquarters facility may qualify for credits against their franchise and excise tax liability based on the amount of qualified relocation expenses incurred in the establishment of a headquarters facility. This is a fully refundable tax credit. Credits range from $10,000 to $100,000 per position.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.




Integrated Supplier and Integrated Customer Tax Credit   
Extends certain tax credits to businesses qualified as an "integrated supplier" or "integrated customer"
Must be located within the footprint of a project meeting the $1 billion investment threshold and creating 500 or more occupational wage jobs. An integrated supplier or integrated customer locating within the footprint of such a project will qualify for a Job Tax Super Credit equal to $5,000 per qualified job with a 15 year carry-forward, plus an additional $5,000 per job each year for 6 years. The Integrated Supplier Tax Credit applies regardless of capital investment or number of jobs created.

The purpose of the Integrated Supplier and Integrated Customer Tax Credit is to expand the impact of large "anchor" projects by encouraging co-location of suppliers and customers.


 
Allows headquarters to convert unused net operating losses (NOL) to a credit against franchise and excise tax liability
Companies with a regional, national or international qualified headquarters facility in Tennessee may, with approval from the Commissioner of Revenue and the Commissioner of Economic and Community Development, convert unused net operating losses (NOL) to a credit against franchise and excise tax liability. The NOL credit is available only if the company is unable to use the NOL to offset net income during the current tax year.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.

 


WIN contracts with businesses in the public, private non-profit, and private sectors to provide On-the-Job Training (OJT) to eligible WIN participants; Depending upon the details of the agreement, businesses may be reimbursed up to 50% of the trainee’s wage during the training period
Participation requirements are as follows: 1) The job seeker must be eligible for training through the Workforce Investment Act, i.e. either unemployed or underemployed (defined as not earning a self-sufficiency wage of $15 or more per hour); 2) The employer must be willing to provide OJT participants with continued long-term, full-time employment (with wages, benefits, and working conditions that are equal to those provided to regular employees who have worked a similar length of time and are doing the same type of work); 3) An OJT contract must be limited to the period of time required for a participant to become proficient in the occupation for which the training is being provided. In determining the appropriate length of the contract, consideration should be given to the skill requirements of the occupation, the academic and occupational skill level of the participant, prior work experience, and the participant’s individual employment plan.

Developed so that employers can remain competitive and the State of Tennessee can produce viable, progressive businesses.

 



Tax abatement of up to 90% of city personal and property taxes and 75% of county personal and property taxes for a maximum of 15 years
Amount of abatement is determined by capital investment, number of new jobs, average wage of new jobs, location of project, diversity plan, environmental plan, and industry. To be considered, companies must have a minimum capital investment of $1 million and hire add at least 15 new jobs at an average salary of $10 or more per hour. Retention PILOTs require a minimum capital investment of $10 million and the creation of at least 100 new jobs.

Created to alleviate the burden of start-up and relocation expenditures.





Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time
The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here: http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf)

The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.



Provides small businesses and entrepreneurs loans for creating and retaining jobs
Loans are based upon the borrower's needs, repayment ability, what the borrower is financing and confirmation that jobs will be created. Interest rates are determined by perceived credit risk and are two percentage points below the current prime rate with a floor of four percent.
Designed to boost local strategies that enable the community to invest in small businesses and entrepreneurial initiatives, encouraging the creation, retention, and expansion of jobs helping grow the local economy.




Allows a qualified business locating or expanding in a Tier 2 county may take 3 years to create 25 jobs, and business locating or expanding in a Tier 3 county may take 5 years to create 25 jobs
The Enhanced Job Tax Credit for Tier 2 and Tier 3 Enhancement Counties is in addition to the regular Job Tax Credit and cannot be carried forward. If a qualified business enterprise locates or expands in a Tier 2 or Tier 3 Enhancement County, the company will be eligible for an annual Enhanced Job Tax Credit of $4,500 for each qualified job, provided that the job remains filled during the year in which the credit is being taken. The annual credit may be used to offset up to 100% of the company's total franchise and excise (F&E) tax liability each year for a three-year period in Tier 2 counties and a five-year period in Tier 3 counties.

The Enhanced Job Tax Credit was created to promote new industry locations and expansions in more rural areas of the state.




Sales and Use Tax Credit for Emerging Industries   
A credit equal to 6.5% of the 7% state sales and use taxes available to emerging industries
Tennessee law makes a sales and use tax credit available to taxpayers that establish a qualified facility to support an emerging industry in Tennessee with a minimum capital investment of $100 million and the creation of at least 50 new full-time jobs paying 150% of Tennessee's average occupational wage. The credit is equal to 6.5% of the 7% state sales and use tax paid to Tennessee on the sale or use of qualified tangible personal property.

Created to promote the development of emerging, high-tech, and clean energy industries in Tennessee.




Credit of 6.5% of the 7% state sales and use tax for qualified headquarters
Credit for sales and use tax paid on qualified tangible personal property purchased for the headquarters during the investment period. The investment period for the sales and use tax credit begins one year prior to construction or expansion and ends one year after construction or expansion is substantially complete and cannot exceed 6 years. Note: The taxpayer must file and receive approval of the Qualified Headquarter Business Plan with the Department of Revenue before taking the sales and use tax credits.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.




Businesses are eligible for tax credits for qualified solar water heating and photovoltaic systems, and for certain solar lighting systems; The tax credits are for 30% of the cost of the system
The tax credits go to businesses that install solar equipment for their use, and to individuals who install qualifying systems on homes they use as a residence (unlike other consumer incentives, the dwelling does not have to be the taxpayer's primary residence - second homes are eligible, although rental properties are not); Note: The credits are available for systems "placed in service" between January 1, 2006 and December 31, 2016;

Developed to encourage energy efficient consumers, businesses and practices.




Provides economically distressed counties with loans for industrial expansion, relocation, retention, and infrastructure development
Only counties with the lowest per capita personal income, the highest percentage of residents below the poverty level, and the highest annual average unemployment rates are eligible for this program. SOC loans are made for buildings, plant equipment, infrastructure, or real estate based on the capital investment leveraged and the number of jobs created by a venture. SOC loans can also be made to local economic development entities for capacity-building projects such as sites or buildings. View a map of the Special Opportunities Counties, here (http://www.tvaed.com/pdf/soc_counties.pdf).

Created to spur growth in economically distressed counties.




Credit of $5,000 per new job to offset up to 100% of franchise and excise taxes for a period of 3 to 20 years; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.
Company must invest capital of $100 million or more and create a minimum of 100 jobs paying at least 100% of Tennessee's average occupational wage or invest $10 million in a qualified headquarters facility and create at least 100 new headquarters jobs paying 150% of the average occupational wage. These credits can be used to offset up to 100% of the company's F&E tax liability each year for 3 to 20 years starting the first tax year after the job creation and capital investment thresholds have been met. In addition to the jobs portion of the Super Credit, a company that qualifies for the Super Credit may exempt two-thirds (2/3) of the required capital investment made during the investment period from the property measure of its franchise tax base on Schedule G of the company's F&E tax return during the tax years in which the annual credit is actually taken.

Created to incentivize larger, more capital-intensive investments.




Tax credit of $5,000 for each new high-wage job created, offsetting up to 100% of franchise and excise taxes; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.
Must commit to $10 million capital investment and create at least 100 headquarters jobs paying 150% of the average occupational wage in establishing or expanding a qualified headquarters facility. Credit good for three years with no carry forward. The Commissioner of Revenue may lower the wage requirement and investment criteria for a qualified headquarters facility if the headquarters locates in a Central Business District or Economic Recovery Zone. The investment period for the Super Job Tax Credit is 3 years, but may be expanded to 5 years with approval from the Commissioner of Economic and Community Development.

Developed to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.




Monthly power bill credits to qualifying power customers who contribute to the economic development of the Tennessee Valley
Award amounts based on capital investment, jobs added or retained, average wages paid, and annual load factor. Requires at 250-kilowatt peak monthly demand, and minimum of 25 employees with no plans to reduce workforce by 50 percent or more. Must commit to a projected five-year capital investment of 25 percent of an existing facility?s book value, or $2.5 million in a new facility. Requires standard power contract with a remaining term at least as long as the five- or eight-year VII award period.
Created to lower energy costs for companies that contribute to economic growth.
BACK

Tax Incentives

Affordable Apartment Rental Additional Unit Allowance

Apply an additional 50% revenue allowance over MLGW’s standard policy

The developer must submit documentation proving that the particular apartment development is recognized as a low income development by the appropriate nonprofit or government agency. The builder must also enroll the apartment development in MLGW’s EcoBuild program.

Promote development of apartments for affordable rental housing.


Affordable Homes Waiver of Connect Fees Incentive

Connect fees may be waived or refunded to the home builder

The Builder must submit proof of the home’s certification from a non-profit or government agency that the home is eligible for “affordable” incentives at the time the service request is made; The builder must enroll the home in MLGW’s EcoBuild program; The home must be an individual single-family home or duplex; The maximum sale price shall be $140,000.

Promote non-profit and governmental agency efforts to produce affordable dwelling units.


Affordable Housing Additional Lot Allowance Incentive

Apply an additional 50% lot allowance over MLGW’s standard policy

The developer must submit documentation proving that the particular development is recognized as a low income development by the appropriate nonprofit or government agency; At least fifty percent (50%) of the homes in the development must meet affordable housing criteria; The homes must meet EcoBuild criteria; The homes shall not exceed $140,000 in price.

Promote development of lots for affordable housing.


Community Investment Tax Credit

Provides a tax credit to financial institutions when loans, qualified investments, grants or contributions are made to organizations involved in developing low income housing

Eligible Activities are as follows: 1) Activities that create or preserve affordable housing for low income Tennesseans, 2) Activities that assist low income Tennesseans in obtaining safe and affordable housing, 3) Activities that build the capacity of an eligible non-profit organization to provide housing opportunities for low-income Tennesseans, and 4) Any other low-income housing related activity approved by the THDA Executive Director and the Commissioner of Revenue. Eligible Housing Entities are as follows: 1) Tennessee based non-profit organizations with an Internal Revenue Code 501 (C)(3) status, 2) Public Housing Authorities, 3) Development Districts, and 4) Tennessee Housing Development Agency.

Developed to increase low income housing development.


Data Center Tax Credit

Tax credit for the purchase of materials related to the construction of a data center

Applies to buildings housing high technology computer systems and related equipment in which the taxpayers had made a minimum capital investment of $250 million and has created 25 new jobs paying at least 150% of the state's average occupational wage. Investments must be made during a 3 year period, but can be extended to 7 years at the discretion of the Commissioner of Economic and Community Development; The purchase of computers, computer systems, computer software and repair parts for a qualified data center are considered purchases of industrial machinery and qualify for a minimum 5% Industrial Machinery Tax Credit against F&E liability. Computers, computer systems, computer software and repair parts used in qualified data centers are classified as industrial machinery and exempt from sales and use taxes. Qualified data centers also pay reduced sales taxes on the purchase of electricity (1.5% vs. the previous rate of 7%).

Created to assist expanding and emerging tech companies with expansion.


Diversity Plan

Extends the term of the PILOT program for those who hire minority employees or contractors

All PILOT companies must file a Diversity Plan with the industrial development board, but those which meet or exceed all of the goals of the Diversity Plan may extend the PILOT by one or two years at the discretion of the Industrial Development Board.

Created to encourage the support and inclusion of minority, women, and locally owned small businesses in the economic development of the local community.


Green Energy Tax Credit

Tax credit against franchise and excise taxes for companies involved in producing green technology

Must be a certified green energy supply chain manufacturer or affiliated company. "Certified green energy supply chain manufacturer? means any manufacturer that has made during the investment period a required capital investment in excess of $250 million in constructing, expanding, or remodeling a facility that is certified to be a facility engaged in manufacturing a product that is necessary for the production of green energy.

Green Energy Tax Credit was developed as a part of a comprehensive strategy to encourage green energy projects to locate in Tennessee.


Green Power Providers Program

Green Power Providers participants are eligible for a federal tax credit that can mean substantial savings on their tax bills

Tennessee Valley Authority (TVA) and participating power distributors of TVA power offer a performance-based incentive program to homeowners and businesses for the installation of renewable generation systems from the following qualifying resources: PV, wind, hydropower, and biomass; Eligible Systems must not have previously generated renewable energy for sale to TVA prior to October 1, 2012, unless the system was part of the Generation Partners pilot; Qualifying systems will have a minimum total nameplate generation capacity (DC) of 500 watts (W) and a maximum of 50 kilowatts (kW). Systems over 50kW may qualify to participate in TVA’s Mid-Sized Renewable Standard Offer program (link to DSIRE summary). Systems greater than 10 kilowatts in size will be subject to a load requirement.

The purpose of the Green Power Providers program is to continue to increase the renewable energy supply in the Tennessee Valley region.


Health, Education and Housing Facility Board PILOT

Property tax freeze for new or rehabilitated affordable housing units

To be eligible for a PILOT, the value of the building renovations, site improvements or new construction must be equal to or greater than 50% of the property acquisition cost. 20% of the Applicant?s units must be occupied by individuals whose income is 50% or less of the median gross income or 40% or more of the units must be occupied by individuals whose income is 60% or less of the median gross income. The project's primary use must be affordable multi-family residential within the limits of the City of Memphis containing a minimum of 24 units. The total project cost for new construction must be at least $1,000,000; and for acquisition/ rehabilitation projects must be at least $750,000. Priority is given to development projects located in Target Areas, as defined by the City, at the time of the application.

Created to encourage new construction and substantial rehabilitation of affordable multi-family housing.


Industrial Machinery Tax Credit

Tax credit of up to 50% of franchise and excise tax liability for purchasing, installing, or repairing industrial machinery

The credit applies to the purchase, installation and repair of industrial machinery as defined in T.C.A. 67-6-102. The credit also applies to the purchase and installation of computer, computer software and certain peripheral devices purchased in order to meet the capital investment thresholds of the Job Tax Credit. Any unused Industrial Machinery Tax Credit may be carried forward for up to 15 years. The percentage of Industrial Machinery Credit allowed is dependent upon the investment made during the investment period, from 1% to 10%.

Created to encourage capital investments in industrial machinery.


Industrial Revenue Bonds

Bonds issued by public entities to fund the construction or renovation of manufacturing facilities

The bonds are issued by public entities on behalf of private, for-profit companies. The bond buyers provide the funds needed by the company. Interest earned by the bond buyers is exempt from federal (and some state) income tax. As a result, the bond buyers are willing to accept a lower interest rate. Funds must be used to acquire land/buildings, construct facilities, renovate facilities, or acquire new or used equipment. Minimum of 70% must go to core manufacturing.

Developed to allow public entities to leverage capital to fund targeted development in the manufacturing sector.


Integrated Supplier and Integrated Customer Tax Credit

Extends certain tax credits to businesses qualified as an "integrated supplier" or "integrated customer"

Must be located within the footprint of a project meeting the $1 billion investment threshold and creating 500 or more occupational wage jobs. An integrated supplier or integrated customer locating within the footprint of such a project will qualify for a Job Tax Super Credit equal to $5,000 per qualified job with a 15 year carry-forward, plus an additional $5,000 per job each year for 6 years. The Integrated Supplier Tax Credit applies regardless of capital investment or number of jobs created.

The purpose of the Integrated Supplier and Integrated Customer Tax Credit is to expand the impact of large "anchor" projects by encouraging co-location of suppliers and customers.


Investment Tax Credit

Provides a tax credit for the rehabilitation of historic buildings

There are two types of ITCs available: 20% for a certified historic structure or 10% for a non-historic structure. The historic property must be income producing. To qualify for the 20% credit, the building must be listed on the National Register of Historic Places, or listed as a contributing structure within a National Register Historic District. The rehabilitation project must meet the "substantial rehabilitation test," which means the owner must spend the adjusted value of the building or $5000, whichever is greater.To qualify for the 10% credit, the structure must have been built before 1936 and must not be listed or eligible for listing on the National Register of Historic Places, the structure must retain 50-70% of external walls and 75% of internal walls, the rehabilitation must meet the "substantial rehabilitation test" as in the 20% credit, and the structure must be used for five years as an income producing property but not as housing.

Created to encourage the rehabilitation of historic buildings.


Low-Income Housing Tax Credit

Offers a credit against federal income tax liability each year for 10 years for owners of and investors in affordable rental housing

An indirect Federal subsidy used to finance the development of affordable rental housing for low-income households. To be eligible for consideration under the LIHTC Program, a proposed project must: 1) Be a residential rental property, 2) Commit to one of two possible low-income occupancy threshold requirements, 3) Restrict rents, including utility charges, in low-income units, 4) Operate under the rent and income restrictions for 30 years or longer, pursuant to written agreements with the agency issuing the tax credits.

Created by Congress to generate equity capital for the construction and rehabilitation of affordable rental housing.


Multifamily Tax-Exempt Bond Authority Program

THDA is making Multifamily Tax-Exempt Bond Authority available to local issuers for financing for multifamily housing units in Tennessee

The Multifamily Tax-Exempt Bond Authority can be used only to provide financing for new construction of affordable rental housing units, for conversion of existing properties through adaptive reuse, or for acquisition and rehabilitation of rental units. The development must be: 1) New construction, 2) A conversion of an existing property not being used for housing, or 3) Acquisition and rehabilitation.

Created to ensure the development of low-income housing.


Net Operating Loss Credit for Qualified Headquarters

Allows headquarters to convert unused net operating losses (NOL) to a credit against franchise and excise tax liability

Companies with a regional, national or international qualified headquarters facility in Tennessee may, with approval from the Commissioner of Revenue and the Commissioner of Economic and Community Development, convert unused net operating losses (NOL) to a credit against franchise and excise tax liability. The NOL credit is available only if the company is unable to use the NOL to offset net income during the current tax year.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.


New Markets Tax Credit Program

Allows individual and corporate investors to receive a tax credit for making equity investments in Community Development Financial Insitutions

The credit totals 39 percent of the original investment amount and is claimed over a period of seven years. Equity investment must be made in Community Development Entity certified by the US Treasury. CDIs provide investment capital for low-income communities or low-income persons.

Established by Congress in 2000 to spur new or increased investments into operating businesses and real estate projects located in low-income communities.


Payment in Lieu of Tax (PILOT)

Tax abatement of up to 90% of city personal and property taxes and 75% of county personal and property taxes for a maximum of 15 years

Amount of abatement is determined by capital investment, number of new jobs, average wage of new jobs, location of project, diversity plan, environmental plan, and industry. To be considered, companies must have a minimum capital investment of $1 million and hire add at least 15 new jobs at an average salary of $10 or more per hour. Retention PILOTs require a minimum capital investment of $10 million and the creation of at least 100 new jobs.

Created to alleviate the burden of start-up and relocation expenditures.


PILOT (Payment-In-Lieu-of Tax) or Tax-Freeze Program

Financial incentive that freezes property taxes at the predevelopment level for a predetermined period of time

The PILOT Program is offered for redevelopment projects within the Memphis Central Business Improvement District (CBID) which is bounded by Crump Boulevard on the south, Danny Thomas Boulevard on the east, the Wolf River on the north and the Mississippi River on the west. The CBID extends through the Medical Center, which is bounded by Linden Avenue on the south, Watkins Street on the east, Poplar Avenue on the north and Danny Thomas Boulevard on the west. To be eligible for a PILOT, the value of the proposed building renovations, site improvements or new construction must be equal to or greater than at least sixty percent (60%) of the total project cost (property & building acquisitions costs or value, soft costs, proposed building renovations, site improvements and/or new construction). See application here:

http://www.downtownmemphiscommission.com/documents/PILOT_Application.pdf)

The PILOT program is a financial incentive that is designed to encourage commercial real estate development in and around the Central Business Improvement District.


Pollution Control Equipment Tax Credit

Tax credit for the purchase of government-mandated pollution control equipment

Purchases of pollution control equipment that is mandated by state, federal or local law and that results in the reduction of water and/or air pollution or the elimination of hazardous waste qualify for tax credits such as exemption from franchise and sales and use taxes among other incentives. Tax credit applies to purchases of pollution control equipment for manufacturers.

Created to alleviate the burden of pollution regulations on industry.


Rural Opportunity Initiative Enhanced Job Tax Credit

Allows a qualified business locating or expanding in a Tier 2 county may take 3 years to create 25 jobs, and business locating or expanding in a Tier 3 county may take 5 years to create 25 jobs

The Enhanced Job Tax Credit for Tier 2 and Tier 3 Enhancement Counties is in addition to the regular Job Tax Credit and cannot be carried forward. If a qualified business enterprise locates or expands in a Tier 2 or Tier 3 Enhancement County, the company will be eligible for an annual Enhanced Job Tax Credit of $4,500 for each qualified job, provided that the job remains filled during the year in which the credit is being taken. The annual credit may be used to offset up to 100% of the company's total franchise and excise (F&E) tax liability each year for a three-year period in Tier 2 counties and a five-year period in Tier 3 counties.

The Enhanced Job Tax Credit was created to promote new industry locations and expansions in more rural areas of the state.


Sales and Use Tax Credit for Qualified Headquarters

Credit of 6.5% of the 7% state sales and use tax for qualified headquarters

Credit for sales and use tax paid on qualified tangible personal property purchased for the headquarters during the investment period. The investment period for the sales and use tax credit begins one year prior to construction or expansion and ends one year after construction or expansion is substantially complete and cannot exceed 6 years. Note: The taxpayer must file and receive approval of the Qualified Headquarter Business Plan with the Department of Revenue before taking the sales and use tax credits.

Created to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.


Super Jobs Tax Credit

Credit of $5,000 per new job to offset up to 100% of franchise and excise taxes for a period of 3 to 20 years; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.

Company must invest capital of $100 million or more and create a minimum of 100 jobs paying at least 100% of Tennessee's average occupational wage or invest $10 million in a qualified headquarters facility and create at least 100 new headquarters jobs paying 150% of the average occupational wage. These credits can be used to offset up to 100% of the company's F&E tax liability each year for 3 to 20 years starting the first tax year after the job creation and capital investment thresholds have been met. In addition to the jobs portion of the Super Credit, a company that qualifies for the Super Credit may exempt two-thirds (2/3) of the required capital investment made during the investment period from the property measure of its franchise tax base on Schedule G of the company's F&E tax return during the tax years in which the annual credit is actually taken.

Created to incentivize larger, more capital-intensive investments.


Super Jobs Tax Credit for Qualified Headquarters

Tax credit of $5,000 for each new high-wage job created, offsetting up to 100% of franchise and excise taxes; Note: The investment period for the Super Credit is 3 years, but can be expanded to 5 years for investments of $100 million or more and to 7 years for investments of $1 billion or more with the approval of the Commissioner of Economic and Community Development.

Must commit to $10 million capital investment and create at least 100 headquarters jobs paying 150% of the average occupational wage in establishing or expanding a qualified headquarters facility. Credit good for three years with no carry forward. The Commissioner of Revenue may lower the wage requirement and investment criteria for a qualified headquarters facility if the headquarters locates in a Central Business District or Economic Recovery Zone. The investment period for the Super Job Tax Credit is 3 years, but may be expanded to 5 years with approval from the Commissioner of Economic and Community Development.

Developed to encourage companies to locate and expand their regional, national or international corporate headquarters in Tennessee.


Worker's Opportunity Tax Credit

Provides tax credit to employers who hire employees from identified target groups which traditionally face high rates of unemployment

Available to employers who hire and retain veterans and individuals from other target groups with significant barriers to employment. Employers generally can earn a tax credit equal to 25% or 40% of a new employee's first-year wages, up to the maximum for the target group to which the employee belongs. Employers will earn 25% if the employee works at least 120 hours and 40% if the employee works at least 400 hours.

Developed to address high unemployment rates among certain groups.