The Virginia Enterprise Zone (VEZ) program is a partnership between state and local governments that promote economic development and revitalization through job creation and real property investment. When used in conjunction with other local, state, and federal programs, enterprise zones can leverage substantial private sector investment in targeted areas throughout Virginia.
More information about the Enterprise Zone here.
Virginia Enterprise Zone #53 is located within the Alleghany Highlands. The Alleghany Highlands Administrator for the Virginia Enterprise Zone can be contacted here.
Real Property Investment Grant (RPIG)
The RPIG awards up to 20 percent of the total amount of Qualified Real Property Investments (QRP) made to a building or facility, not to exceed $100,000 within a five-consecutive-year period, for investments of less than $5 million. For QRPI of $5 million or more, the grant is capped at $200,000 per building or facility. For rehabilitation and expansion projects, a zone investor must spend at least $100,000 in QRPI to be considered eligible for the RPIG. New construction projects require zone investors spend at least $500,000 to qualify for the grant. The 20 percent grant award is based on the amount of investment made in excess of the $100,000 and $500,000 eligibility thresholds, respectively. Full document here.
Job Creation Grant (JCG)
The JCG awards up to $500 or $800 for each new, permanent and full-time position created above a four-position threshold. Positions earning at least $12.69/hour (175 percent of the federal minimum wage of $7,25/hour) with health benefits are eligible for a grant of up to $500/position. Positions earning at least $14.50 (200 percent of the federal minimum wage) with health benefits are eligible for a grant of up to 350 positions per year for a period of five years. Retail, food and beverage, personal service and nonprofit positions are not eligible for the JCG. Full document here.
In December 2017, Congress passed the Tax Cuts and Jobs Act which included the Opportunity Zone tax incentive meant to spur economic development and revitalization in communities lacking access to capital. This new tool encourages long-term equity investments in these under-served communities. Under the Act, investors receive tax incentives to capitalize Qualified Opportunity Zone Funds that invest in developments and businesses operating in designated Opportunity Zone census tracts.
First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%. Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.