Area Development Pennsylvania Resource Page
Direct Financial Incentives
New Economic Stimulus Programs:
Business in Our Sites: Flexible loans and grants for municipalities and their economic development partners to create future business growth and attract opportunity through the acquisition and preparation of key sites for development.
Building PA: Provides funding for the development of real estate assets within the commonwealth. Funds will be loaned to experienced investment fund managers that will raise matching funds and invest in real estate projects throughout the commonwealth.
New Pennsylvania Venture Guarantee Program: Allows the commonwealth to more actively partner with the investment community by structuring a program that provides loan guarantees to venture capital firms interested in investing in Pennsylvania businesses. These guarantees will provide increased capital for Pennsylvania businesses to grow and create jobs.
New PA Venture Capital Investment Program: Loans to Pennsylvania-focused venture capital fund managers that agree to match those funds and make investments in Pennsylvania businesses. At least 50 percent of the money must be invested in underserved areas of Pennsylvania.
First Industries Fund: Low-interest loans, loan guarantees, and planning grants for Pennsylvania's agriculture and tourism businesses to help these vital industries stay healthy and dynamic.
Second Stage Loan Program: Provides guarantees for bank loans to second-stage manufacturers and technology companies for working capital and other financing needs; targeted toward manufacturing, advanced technology, and biotechnology.
Tax Increment Financing (TIF) Guarantee Program: Through TIF financing, communities can borrow funds for projects that will develop blighted areas and then repay those borrowed monies through the incremental tax revenues that will be generated as result of the development. While this method of financing has been used extensively by the state's largest cities, smaller communities have not tapped into the potential of TIF financing. In order to solve this disparity, a combination of technical assistance and loan guarantee assistance will encourage small and mid-sized communities to utilize this method of financing projects.
Infrastructure and Facilities Improvement Program: This is a multiyear grant program that will provide grants to certain issuers of debt in order to assist with the payment of debt service. The grants will be based upon incremental state tax revenue that will result from the development of new infrastructure. The funds are targeted to manufacturing, hospitals, large retail, and convention center projects.
Elm Street: Encourages improvements to residential communities that are located in proximity to commercial corridors by providing grants that can be used to upgrade the physical infrastructure such as streetscapes, sidewalks, and lighting, as well as improving housing facades and exterior repairs.
Main Street: The Main Street program has been a successful model to assist small towns and cities to revitalize their central business district. The stimulus effort includes doubling of this program's funding. This grant program supports creation of a local organization and some physical improvements to the downtown structures that make Main Street more attractive business locations.
Keystone Innovation Zones (KIZs): Provides grant funds to community/university partnerships to generate job growth through tech transfer and entrepreneurship; focused around campuses and property around college and universities.
Expanded Research and Development (R&D) Tax Credit: Research and new product development are cornerstones to broader economic growth. From manufacturing to drug discovery, the commonwealth can be an active agent in stimulating both academic and private research as well as moving the fruits of that research into the marketplace.
Core Industries: Enhances the successful Machinery and Equipment Loan Fund (MELF) by adding additional funds for revolving loan funds and by increasing the maximum loan amount from $500,000 to $5 million. A portion of the funding will be targeted to aid hospitals with the purchase and installation of FDA-required pharmaceutical management technology.
Base Retention and Conversion: Funds are provided for the 2005 BRAC and post-BRAC-related activities, to be used in assisting local defense groups to defend against the 2005 BRAC round, to plan for the reuse of excess military property as determined by the BRAC Commission, and to implement a statewide strategy to enhance the military value of these installations and organizations against future BRAC rounds and non-BRAC related activities designed to reduce the footprint and impact of the military within Pennsylvania. There are a total of 71,173 in the active and reserve military, the National Guard, and Department of Defense civilian positions within the commonwealth that who contribute $9.26 billion directly into the commonwealth's economy. The 2005 BRAC Commission recommended that the next BRAC round be held in 2015.
Section 108 (HUD) Loan Pool: Enables small and mid-size communities to access loan funds for economic development and community facilities by participating in the Community Development Block Grant (CDBG) program to obtain federally guaranteed loans that fund large economic development projects and undertake revitalization activities. Under Pennsylvania's initiative to use HUD 108, the loans are guaranteed by the commonwealth, committing the use of future CDBG funds to pay off the loan in case of default.
Homeownership Choice Program (HCP): An incentive program of the Pennsylvania Housing Financing Agency (PHFA). The HCP finances new, single-family home construction in blighted urban areas of the commonwealth. It creates more opportunities for families to own their own homes, ultimately transforming neglected neighborhoods into better places to live and work.
Housing and Redevelopment Assistance: This program provides the most flexible funding available to cities and smaller urban areas in order to revitalize downtowns, older industrial areas, and commercial sites. This funding source also provides affordable housing. Funding for this program has been significantly increased as part of the commonwealth's economic stimulus plan.
PennWorks (Water Supply and Wastewater Infrastructure Program): This funding is to ensure safe water supply and proper wastewater infrastructure. The program provides grants to municipalities and municipal authorities, and loans to municipalities, municipal authorities, industrial development corporations, and investor-owned water or wastewater enterprises for projects related to economic development.
Additional Direct Financial Incentives
Community Economic Development Loan Program (CED): Provides loans for businesses located within distressed municipalities in Pennsylvania. Up to $100,000 or 50 percent of the total project cost (whichever is less) for land and building acquisition; building construction and renovation; machinery and equipment acquisition, upgrade, and installation; and working capital cost.
Customized Job Training Program (CJT): Offers grants to eligible businesses to train employees in specific skills to meet an individual employer's needs. The maximum grant amount is 75 percent of the total eligible cost of the training. The firm selects the training site and trainees, and establishes course criteria.
Educational Improvement Tax Credit Program (EITC): Provides tax credits to eligible businesses that contribute to a Scholarship Organization, an Educational Improvement Organization, or a Pre-Kindergarten Scholarship Organization.
Export Finance Program (EFP): Provides loans to small businesses (250 employees or fewer) that have been in operation for at least 12 months to begin or expand exporting. Program offers working capital and accounts receivable financing in amounts of up to $350,000, and works in conjunction with the Export-Import Bank of the United States.
New Communities/Enterprise Zone Program: A grant program to assist financially disadvantaged communities in preparing and implementing business development strategies within municipal enterprise zones. Enterprise zones may provide funding directly to businesses locating within zones at below-market rates for facility acquisition, construction, and renovation, and for machinery and equipment purchases.
Infrastructure Development Program (IDP): Provides grants and loans to eligible applicants for specific infrastructure improvements necessary to complement eligible capital investment by private companies and developers. Manufacturers, industrial, research and development firms, agricultural enterprises, traded services firms establishing a national or regional headquarters, or private real estate developers who are developing sites for eligible businesses may apply through eligible applicants.
Industrial Sites Reuse Program (ISRP): Provides grants and low-interest loans for environmental assessments and remediation. The program is designed to foster the cleanup of environmental contamination at former industrial sites, thereby bringing blighted land into productive reuse. Public entities, private nonprofit economic development entities, companies involved in reuse of former industrial land, and entities that did not cause or contribute to environmental contamination are eligible to apply for ISR funding.
Job Creation Tax Credits (JCTC): Provides a $1,000 tax credit to approved businesses that agree to create jobs in the commonwealth within three years. A business must be involved in the development or deployment of leading technologies within its industry and create at least 25 jobs or new jobs equaling at least 20 percent of its existing work force.
Keystone Opportunity Zones (KOZ): Entitles qualified businesses, property owners, and individuals to certain tax abatements, deductions, exemptions, or credits from state and local taxes. "Qualified" means satisfactorily meeting the necessary criteria listed in the act.
Machinery and Equipment Loan Fund (MELF): Provides low-interest loans for machinery and equipment to eligible Pennsylvania businesses. Loan proceeds may be used to acquire and install new or used machinery and equipment or upgrade existing machinery and equipment. Companies must be engaged in manufacturing, industrial, agricultural processes, or direct mining operations.
Neighborhood Assistance Program (NAP) Tax Credits: A corporate tax liability credit program that encourages businesses to donate capital that can be used to provide eligible services to low-income persons or distressed neighborhoods.
Neighborhood Partnership Program: Tax credits to businesses that sponsor a neighborhood organization to develop and implement a neighborhood revitalization plan by contributing a substantial amount of cash per year over an extended period of time.
Neighborhood Assistance Program Enterprise Zone Tax Credit Program (NAP/EZP): Provides tax credits toward PA Corporate Tax Liability to businesses investing in or making physical improvements to properties located within designated enterprises zones.
Opportunity Grant Program (OGP): Provides grants to firms or IDCs and municipalities on behalf of firms that will create or retain a significant number of jobs within the Commonwealth. The funds may be used for job training, infrastructure, land and building improvements, machinery and equipment, working capital, and environmental assessment and remediation. Projects must offer substantial economic impact either for the state as a whole or for the locality or region in which the company plans to locate. The grant requires a 4:1 private to public match.
PA Economic Development Financing Authority (PEDFA) Bond Programs: Offers low-interest loans to businesses located in Pennsylvania by issuing both tax-exempt and taxable industrial revenue bonds. Funding can be used to finance land, equipment, and buildings; $400,000 minimum.
PA Capital Access Program (PennCAP): A loan guarantee program for Pennsylvania companies through participating PennCAP banks. Proceeds of the loan can be used for land and buildings, equipment, and working capital. Loans for up to $500,000 can be term or line of credit.
PA Industrial Development Authority (PIDA): Administers long-term, low-interest loans to stimulate economic activity for eligible businesses — typically manufacturing and industrial development. The funds may be used for land and building acquisition, new construction, expansion, and renovation, resulting in job creation or retention. The higher the unemployment rate, the greater the agency's participation (up to 70 percent) and the lower the interest rate.
PA Infrastructure Investment Authority (PennVEST): Provides low-interest loans and grants for design, engineering, and construction of publicly and privately owned drinking-water distribution and treatment facilities, stormwater conveyance, and wastewater treatment systems. Maximum construction loan amounts are $11 million per project for one municipality; $20 million for more than one municipality. The maximum design and engineering loan amount is $2 million.
PA Minority Business Development Authority Program (PMBDA): Provides low-interest loans to businesses owned and operated by ethnic minorities for land and building acquisition; building construction and renovation; machinery and equipment acquisition and installation; and working capital.
PA Pollution Prevention Assistance Program (PPAA): Provides small businesses (100 employees or fewer) with loans of up to $100,000 or 75 percent of the total project cost, whichever is less, for new or used machinery and equipment that is directly related to the pollution-prevention process or conservation of energy.
Rail Freight Assistance (RFA): Grants for railroads and rail freight users to build or repair rail lines or spurs.
Research and Development Tax Credit: Allows qualified Pennsylvania companies conducting new research and development activities to apply for a tax credit of 10 percent of their increased research and development expenses over a base period.
Small Business First (SBF): Provides low-interest loans for specific industries of up to $200,000 or 40 percent of the total project cost, whichever is less, to small businesses (100 employees or fewer) for land and building acquisition; building construction and renovation; machinery and equipment acquisition, upgrade, and installation. Projects may include compliance with environmental regulations; municipal or commercial recycling; defense-related, export-related, advanced technology, agriculture enterprises, and computer-related services; or involve the hospitality industry, such as hotels, motels, and restaurants.
Technology Investment Programs
- • Ben Franklin Technology Development Authority: A vital vehicle for investing in economic, community, and university-based innovation. It includes programs to provide equity-like investments in technology companies and insure that the groundbreaking research being performed in Pennsylvania's universities is commercialized and available to benefit Pennsylvanians.
- • Ben Franklin Partners: Availability of seed-venture money and business expertise from the Ben Franklin Technology Partners to startup companies or existing companies for research and development, technology transfer, joint research and development between private companies and universities, and technology training/entrepreneurial infrastructure.
- • Technology Company Investment Program: This is a flexible financing tool that enables technology-oriented Pennsylvania businesses to thrive in the digital economy. The program fills a gap in the commonwealth's finance program arsenal for companies requiring non-asset-backed, equity-like investments.
- • Technology Development Grants: Funding available to support initiatives of communities, economic development organizations, as well as businesses engaged in the advancement of technology in the community.
- • University Research Funding: This program available for colleges or universities and nonprofit organizations partnering with colleges/universities for research and development and technology transfer.
Venture Capital: Pennsylvania is home to several venture capital firms that are actively investing in early to later stage companies. Through public and private investments, Pennsylvania is creating opportunity for its companies in the new economy.
Underground Storage Tank Upgrade Loan Program (USTULP): Offers loan financing to business owners of regulated underground storage tanks to meet federal Environmental Protection Agency (EPA) upgrade requirements. The funds may be used for tank removal or closure; replacement of tanks; upgrade of existing tanks; leak detection devices; cost of new tanks; piping; dispensers; engineering design and permitting costs associated with upgrading; and all construction and installation costs directly associated with upgrading.
Work Force Investment Act of 1998 (Title 1): A federal program that provides employment assistance and job training to eligible individuals.
Guaranteed Free Training Program (GFT-WEDnetPA): Basic skills and information technology training through Pennsylvania universities for manufacturing, technology-based, information technology businesses, and PA businesses other than point of sale/retail businesses.
Workforce Leadership Grants: Program purposes are integrated and seamless education programs cutting across secondary and postsecondary education and expansion of community college services. Programs require strong business participation, articulation agreements, and program guarantees.
Business Management and Technical Assistance Incentives
Governor's Action Team: Seasoned economic development professionals that will provide guidance on the tools, advantages and opportunities available for businesses making sizeable company investments within Pennsylvania.
International Business Development: Pennsylvania representatives are positioned throughout the world to assist with foreign investment.
Industrial Resource Center Network (IRC): Funded by the commonwealth; provide technical assistance to small and medium-sized manufacturing firms seeking to adopt available techniques to become more competitive and improve quality and productivity. There are eight centers statewide.
Pennsylvania Technical Assistance Program (PennTAP): A federal/state/university partnership for economic development. PennTAP helps Pennsylvania manufacturing businesses improve their competitiveness by providing free technical assistance and information to help resolve specific technical questions or needs that can be addressed within a limited amount of time.
Small Business Development Centers (SBDCs): Offer technical assistance and consulting services to current and prospective entrepreneurs. SBDCs' counseling areas of expertise range from business plan development and implementation to issues related to business operations and growth.
Pennsylvania State Contact:Governor's Action Team
Commonwealth of Pennsylvania
400 North Street
Commonwealth Keystone Building
Harrisburg, PA 17120
(717) 787-8199
Fax: (717) 772-5419
