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Area Development - Site Selection, Facility Planning and Workforce Development

Delaware Direct Financial Incentives 2011

Delaware's economic development, finance and tax organizations provide a range of incentive programs to initiate new business and commercial investment. Specific programs include no sales tax, no property tax, the New Economy Jobs Program, and targeted industry tax incentives.

March 2011
Public Utility Tax Rebates:
Firms meeting the criteria for targeted industry tax credits are eligible for a rebate of 50 percent of the public utilities tax imposed on new or increased consumption of gas and electricity for five years. The public utilities tax rate is 4.25 percent. The utility tax on the consumption of electric by licensed manufacturers and food or agribusiness processors is reduced from 4.25 percent to 2 percent. Additionally, electric consumed in the manufacture of automobiles is exempt from the utility tax.

Corporate Income Tax Credits (Targeted Industry & Targeted Areas):
Firms within targeted industries qualify for corporate income tax credits of $400 for each new employee and $400 for each new $100,000 investment. Firms within targeted industries who also locate in a targeted area, qualify for $650 for each new employee and $650 for each new $100,000 investment. Firms must invest a minimum of $200,000 and create a minimum of five new positions.

Brownfields Tax Credit Program:
Provides tax credits to any taxpayer who invests $200,000 in a qualified brownfield facility and who has hired at least five qualified employees during any taxable year. Companies that locate in a brownfield are eligible to receive tax credits for new employees ($650 for each new employee), capital investment ($650 per each $100,000 of investment), and a 15-year graduated gross receipts tax credit.

New Economy Jobs Program:
The New Economy Jobs Program is designed to provide an innovative tool to bring high-wage jobs to Delaware and make the state more competitive, while allowing the state to effectively recruit and establish headquarters, research and development jobs, and specialized financial services firms. The legislation provides businesses up to a 65 percent rebate on withholding taxes. To qualify, an employer must add at least 50 net new jobs for new Delaware taxpayers with each having an annual salary of at least $100,000.

Delaware Competitiveness Fund:
The purpose of the Delaware Competitiveness Fund is to induce Delaware legacy manufacturers to make capital investments to preserve and expand productivity, competitiveness and jobs at existing Delaware plant sites that face decline due to national and global competition. Grants from the Competitiveness Fund may equal up to 3 percent of the project's total capital investment. Loans may equal up to 95 percent of the total project cost.

Delaware Strategic Fund:
The Delaware Strategic Fund represents the primary funding source used by the Delaware Economic Development Office to provide customized financial assistance to businesses. For businesses considering locating in the State of Delaware, financial assistance may be provided in the form of low interest loans, grants, or other creative instruments to support the attraction of businesses that pay sustainable wages. The Delaware Strategic Fund also represents the primary funding source used by for SBIR Bridge Grants and Brownfield Grants.

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