There are a wide variety of incentive financing programs available to help a company that leases space at 275 CenterPoint Boulevard. The following is a sampling of those programs most often used by companies that move into CenterPoint.
Local Tax Abatement Programs
Local Economic Revitalization Tax Assistance Program (LERTA)
Every building constructed in CenterPoint receives a 10 year, 100% real estate tax abatement on improvements via the LERTA program. This abatement program was approved by the Luzerne County Commissioners, the Pittston Area School Board, and the Supervisors of Jenkins and Pittston Townships. The annual real estate taxes you will save when you move into a LERTA-approved building in CenterPoint may vary depending upon the cost of construction required to meet your exact specifications. For 275 CenterPoint Boulevard, the LERTA program expires on June 30, 2019. Contact Mericle’s Leasing Team for a detailed savings estimate.
State Funding Programs
Mericle has worked with the leadership of the Pennsylvania Department of Community and Economic Development and the Governor’s Action Team to help obtain grants, tax credits, and low interest loans for several companies that have relocated into our buildings. We will be pleased to arrange a meeting between representatives of your company and the Governor’s Action Team to discuss the potential availability of incentive funding.
Here are brief descriptions of some of the state grant, tax credit and low interest loan programs often utilized by eligible growing businesses.
Job Creation Tax Credit Program
The Job Creation Tax Credit Program offers a $1,000 state tax credit per new full-time job per year to employers who demonstrate effective development or deployment of leading technologies in business operations. Businesses must create at least 25 new full-time jobs or expand their existing workforce by at least 20 percent within three years of approval. Tax credits will not be applied until the workforce increase requirement has been met.
In order to count as a full-time employee under the JCTC program, new employees must earn an average of 150% of the federal minimum wage, excluding benefits. The credit may be utilized to pay a number of state business taxes. At least 25% of all available tax credits will be awarded every year to businesses that employ 100 or fewer employees. An eligible business must agree to maintain its operation in Pennsylvania for a minimum period of five years from the start date of approval. Please visit www.newpa.com for specific requirements and restrictions.
Pennsylvania First Program
The Pennsylvania First Program is a comprehensive funding tool used to enable increased investment and job creation within the Commonwealth. The program assists businesses, municipalities, or IDCs who intend to create or retain a significant number of jobs and make a substantial investment within Pennsylvania. These businesses can receive support in the form of grants, loans and loan guarantees for job training, property acquisition, site preparation, land and building improvements, purchasing or upgrading machinery and equipment, infrastructure, environmental assessments, job training, and working capital.
The program requires participants to commit to operating at the approved project site for a minimum of seven years. Businesses aided by Pennsylvania First must create or retain at least 100 full-time positions, or increase their full-time employment by 20% within the Commonwealth. Full-time employees must earn at least 150% of the federal minimum wage. Other requirements include offering a substantial economic impact for the region and, at the least, matching the Pennsylvania First assistance requested with private investment.
Loan terms can be up to 15 years for real estate and infrastructure and up to 10 years for machinery and equipment. Interest rates will be set at the time of approval and will be based on the 10 year Treasury rate. Those interested in applying can complete the Single Application for Assistance online at www.newpa.com. Please visitwww.newpa.com for more requirements and restrictions.
Pennsylvania Economic Development Financing Authority Tax Exempt Bond Program
The Pennsylvania Economic Development Financing Authority (PEDFA) Tax Exempt Bond Program assists in financing land and building acquisition, machinery and equipment acquisition and installation, as well as renovations and new construction.
The loan amount must fall between $400,000 and $10 million, and may be pooled bond transactions or stand-alone transactions. The loan can be up to a 30-year term. Since 1989, the base interest rate has averaged 46 percent of Prime. The rate is weekly variable and dependent on a variety of market factors. Those eligible for the PEDFA Tax Exempt Bond Program are industries such as manufacturing, energy, solid waste disposal, wastewater treatment, transportation facilities, assisted living/housing, and nonprofit 501(c)(3). Eligible businesses may apply through Industrial Development Authorities and Industrial Development Corporations. Please visit www.newpa.com for more details.
There are several grant programs available to help you reduce your training costs in CenterPoint. Mericle will arrange meetings between your human resources team and the state and local officials who coordinate the following grant programs:
Guaranteed Free Training Program
The Guaranteed Free Training Program provides basic skills and information technology training for eligible employees of expanding businesses. The program can be used towards basic and entry-level skills training and information technology-advanced information technology training. The program is available to Pennsylvania manufacturing and technology-based businesses.
Trainees must be Pennsylvania residents, employed in Pennsylvania, permanent full-time employees, and earn at least 150% of the current federal minimum wage. The program’s basic skills training provides up to $450 per trainee and $75,000 per company. The information technology training provides up to $850 per trainee and $50,000 per company.
Workforce Innovation & Opportunity Act of 2014
The Workforce Innovation & Opportunity Act of 2014 (WIOA) is a federal program that reimburses employers for part of the cost of training. Eligible candidates for this program include private and public sector employers and employees. Any employer that trains program-eligible applicants can apply for reimbursement through the WIOA program. Eligible applicants include dislocated workers and unemployed persons.
The WIOA provides funding for job search and placement assistance, skills assessment and evaluation, counseling, training services for individuals and companies, supportive services, and labor marketing information.
Companies can receive reimbursement for up to 50% of wages paid to eligible employees during training and up to actual costs of classroom training and related training support services. Reimbursement varies by local workforce investment area.
Other Financial Assistance
Luzerne County’s Business Development Loan Program
Your business may be eligible for low-interest loan assistance through this Luzerne County funding source. Loan funds are available for eligible businesses at an interest rate of 1.5% for terms of 7 or 15 years. The County can finance up to 50% of the eligible project costs up to a typical maximum loan amount of $1 million. County funds will be secured by a letter of credit from a financial institution. Funding will be provided for land and/or business acquisition, construction/renovation activities, purchase of machinery and equipment, and professional and financial fees.
Loans are typically made available at $35,000 per job to be created (typical loan maximum is $1 million). Please note that this program is only offered to projects that occur within CenterPoint and other business locations in Luzerne County. Companies that locate in other counties are not eligible for these funds.
A local industrial development corporation (IDC) must sponsor the loan application on your behalf. The IDC of the Greater Pittston Chamber of Commerce will be pleased to serve as the sponsor.
Foreign Trade Zone
Most of the lots in CenterPoint Commerce and Trade Park have Foreign Trade Zone (FTZ) status. FTZs encourage and expedite import/export cargo movements. These specially designated zones are considered outside the Customs territory of the United States, which means that merchandise can be stored, exhibited, assembled, manufactured and processed without being subject to formal Customs entry procedures and payment of duties — unless and until the merchandise enters the Customs territory for domestic consumption.
- Duty Deferral:
No duty is ever charged on merchandise while it is in a Foreign Trade Zone, and there is no limit on the length of time merchandise may be kept in a Foreign Trade Zone. By deferring the duty, capital is freed for more important needs.
- Relief From Inverted Tariffs:
Generally, if foreign merchandise is brought into a Foreign Trade Zone or Subzone and manufactured into a product that carries a lower duty rate, then the lower rate applies.
- Duty Elimination On Waste And Scrap:
No duty is charged on most waste and scrap from production in Foreign Trade Zones.
- No Duty On Domestic Content Or Added Value:
The “value added” to a product in a FTZ (including manufacture using domestic parts, cost of labor, overhead, and profit) is not included in its dutiable value when the final product leaves the Zone. Final duties are assessed on foreign content only.
- Duty Exemption On Re-Exports:
If merchandise is re-exported after being placed in a FTZ or shipped to another FTZ and then re-exported then no duty is ever paid.
- No Duty On Rejected Or Defective Parts:
Merchandise found to be defective or faulty, may be returned to the country of origin for repair or simply destroyed. Whichever choice is taken, no duty is paid. Many companies suffer from the “double duty crunch.” That is, they pay duty on imported merchandise, find it to be faulty and return it to the country of origin for repair, and then pay duty again when the merchandise reenters the United States. If you are a Foreign Trade Zone user or Subzone, the “double duty crunch” is never a problem, because your merchandise never enters the commerce of the United States.
- Administrative Benefits:
Under Customs laws, a company is required to file a customs entry with each shipment of imported merchandise. This involves several associated costs including the cost of preparing, processing and filing the customs entry. Other costs include external service provider fees and a merchandise process fee (MPF) – a .21% ad valorem fee capped at $485 per customs entry – paid to the U.S. Government. However, under zone procedures, FTZ users are allowed to consolidate shipments from an FTZ to the customs territory of the U.S. into a single weekly entry transaction rather than filing an entry per shipment. This significantly reduces the number of customs entries filed by an importer resulting in significant operational and financial benefits.