EL CENTRO – One of the casualties of the fiscal meltdown of the California State budget was the dismantling of the funding and support for the redevelopment agencies created for economically deprived business zones. AB 93 was recently passed by the legislature and signed into law. This bill eliminates the Enterprise Zone Program, effective at the end of this year (January 1, 2014).
Language first supporting the concept of state tax breaks for companies that located or moved to such zones started with “the authority to form a redevelopment agency with the specific purpose of revitalizing deteriorated or blighted areas of the community”.
Brawley held one of the two redevelopment zones in the valley, the Imperial Valley Enterprise Zone, the other was in Calexico.
Danny Fitzgerald, manager of Brawley’s Enterprise Zone said “if you have already hired an employee and obtained a voucher certificate, you may continue to accrue tax credits for that employee, even if they continue to work for you after the end of this year. The tax credits will continue to carry forward for up to 10 years from the end of this year.”
Fitzgerald said that if you have hired an employee and have not yet obtained a voucher certificate, you should do so now. While the legislation is clear that any employees hired prior to the end of the year would qualify, it is not clear whether they would still be able to process the voucher application after the end of this year.
Fitzgerald stressed that if a company is located in the IVEZ area, which includes all of Brawley’s Main Street and most commercial areas, and you are thinking of hiring new employees in the near future and would like to take advantage of the credit, it is still not to late.
Any employees hired before the end of the year are still eligible, and you can continue to claim the credit for as long as they remain with you. Please contact the Enterprise Zone or the OneStop Career Center immediately if you are interested in hiring an employee before the end of the year.
With the Enterprise Zones ending, the county board voted Tuesday to throw their support on a bill working its way through the state assembly to partially replace the redevelopment zones with a new entity called a Community Revitalization Investment Authority (CRIA).
This agency would be tailored for areas such as the Imperial Valley. Before, lawmakers were aware that large corporations took advantage of the old law by tearing down a dilapidated building and constructing hotels, golf courses, or other commercial enterprise and claiming tax credits under redevelopment zones.
Now, certain criteria needs to be met, all easily attained by any business opening in the valley. The new entity would have to operate within a community that had their annual median household under 80% of the state wide annual median, plus a high crime rate, and high unemployment, and buildings and infrastructure in disrepair.
The tax breaks would be through property taxes. A CRIA would invest property tax increments of consenting local agencies, schools are exempt, and other available funding to improve conditions leading to increased employment opportunities, to reduce high crime rates and to repair deteriorating and inadequate infrastructure.
In 2012, multiple legislative laws were passed to help blighted urban and rural areas, but all were vetoed by Brown in an attempt to get control of the burgeoning budget. This proposal may pass through all chambers of government as it is restricted to only the poorest regions of California.
Gary Wyatt, who represents the Valley in Sacramento, said, “This bill is moving through the legislature quite well, it has good legs on it.”