STATE OF OHIO BUSINESS INCENTIVES
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State of Ohio - Tax Incentives
Job Creation Tax Credit – The Job Creation Tax Credit is a refundable tax credit to companies creating at least 25 full-time jobs (within three years) in Ohio. The credit may also be available for certain high-wage industries creating 10 or more full-time jobs within three years. The tax credit is measured as a percentage of the state income tax withholdings for all new employees hired under the program, and is applied to the company’s commercial activity tax liability. Should the amount of the credit exceed the company’s commercial tax liability for any given year, the difference is refunded. Approved projects generally range between a 25 and 55 percent credit for a period of five to seven years. The business must apply for the credit before committing to the project.
Job Retention Tax Credit – The Job Retention Tax Credit is a non-refundable tax credit to companies retaining at least 1,000 full-times jobs in Ohio. Companies must also commit to new fixed-asset investment of either $100 million, if the average wages of the retained jobs exceeds 400 percent of the federal minimum wage (equal to $29.00 per hour), or $200 million, if the average wage of the retained jobs does not exceed 400 percent of the federal minimum wage. The credit is measured as a percentage of the state income tax withholdings for all employees retained under the program. Approved projects range up to 75 percent for 10 years. The business must apply for the credit before committing to the project.
Tort Reform – Governor Bob Taft signed legislation into law in 2004 which established Ohio as a leader in tort reform limiting damages plaintiffs may collect in civil lawsuits, which if left unchecked can prove costly to business. Targeting unquantifiable damages such as pain and suffering, Ohio’s tort reform caps noneconomic damages at three times the economic loss (up to $350,000), or $250,000, whichever is higher.
State of Ohio – Loan Programs
166 Direct Loan – The 166 Direct Loan provides direct loan financing to help finance manufacturing and other eligible facilities. Eligible uses for funding include new building construction, building acquisition, and acquisition of machinery and equipment. Amounts of financing are usually set at 30 percent of the project cost (to a maximum of $1 million), subject to an increase by the Director of the Ohio Department of Development, with a minimum loan amount of $350,000. The rate is fixed (at or below market rates) with terms similar to those of commercial bank financing. Eligible projects must involve significant job creation or retention.
Regional 166 Direct Loan – The Regional 166 Direct Loan provides loans for land and building acquisition, construction, expansion or renovation, and equipment purchases for eligible businesses. Twelve local economic development agencies administer the program. The Regional 166 Direct Loan program was created to promote economic development, business expansion, and job creation by providing financial assistance for eligible projects in the State of Ohio. It provides low-interest loans up to $350,000 to businesses willing to commit.
Rural Industrial Park Loan – The Rural Industrial Park Loan provides direct loans to rural, distressed local communities and applicants committed to creating well-planned industrial parks. The Rural Industrial Park Loan program was created to provide direct loans to local communities and applicants committed to creating well-planned industrial parks. Application assistance for the Rural Industrial Park Loan program is available through the Jackson County Economic Development Board.
Innovation Ohio Loan Fund – The Innovation Ohio Loan Fund provides loans for acquisition, construction, and related costs of technology, facilities and equipment purchase. The fund was created to assist existing Ohio companies develop next-generation products and services within certain Targeted Industry Sectors. The Innovation Ohio Loan Fund provides competitive financing terms on loans to finance projects that will positively impact Ohio by creating high-value jobs, increasing tax revenues, and improving the economic welfare of Ohio.
State of Ohio – Grants
Roadwork Development (629) Funds – Roadwork Development (629) Funds are available for public roadway improvements, including engineering and design costs. These funds are available for projects primarily involving manufacturing, research and development, high technology, corporate headquarters, and distribution activity. Projects must typically create or retain jobs. Grants are usually provided to the local jurisdiction and require local participation.
Rapid Outreach – Rapid Outreach funds are used for on- or off-site infrastructure improvements, including water, sewer, road, and rail improvements. These funds are given to companies primarily engaged in manufacturing, research and development, high technology, corporate headquarters, and distribution. Given the demand for limited grant funds, qualified projects must involve substantial job creation or retention, and all other public and private sources of financing must be considered before the availability of Rapid Outreach funding is determined.
Ohio Capital Access Program – The Ohio Capital Access Program encourages lending to businesses creating or retaining jobs by establishing a unique loan “guarantee” reserve account at a Capital Access Program lending institution. The State, the lender, and the business each make a small contribution to the account. The reserve account is available to the lender for recovery of losses associated with any loan the lender has enrolled in the program.
Ohio Third Frontier – The Ohio Third Frontier is a $1.6 billion initiative to expand Ohio’s high-tech research capabilities and promote innovation and company formation, which in turn will create high-paying jobs for generations to come:
Wright Centers of Innovation
Research and Commercialization Programs
Ohio Research Scholars
Pre-seed and Seed Fund Initiatives
Entrepreneurial Signature Programs
Ohio Research Commercialization Grant Programs
Innovation Ohio Loan Fund
Targeted Industry Attraction Program
State of Ohio – Training Assistance
Ohio Investment and Training Program – The Ohio Investment and Training Program is to provide 50 percent reimbursable training grants directly to Ohio companies when companies make investments that create or retain jobs. The program is formula-based dependent on average hourly wage and number of trainees.
Appalachian Training Investment Program – The Appalachian Training Investment Program assists smaller companies in defraying some of the costs associated with employee training. Since grant recipients can receive up to $30,000, and a consortium of businesses (no fewer than three eligible and qualifying businesses), can receive up to $50,000.