WORLD TRADE  
ORGANIZATION  G/SCM/N/123/USA 
15 November 2007 
 (07-4983) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
SUBSIDIES 
 
New and Full Notification Pursuant to Article XVI:1  
of the GATT 1994 and Article 25 of the Agreement  
on Subsidies and Countervailing Measures  
 
UNITED STATES 
 
  The following communication, dated 23 October 2007, is being circulated at the request of 
the Delegation of the United States.   
 
_______________ 
 
 
 Enclosed please find the new and full notification from the United States, pursuant to 
Article XVI:1 of the GATT 1994 and Article 25 of  the Agreement on Subsidies and Countervailing 
Measures for the 2003 and 2004 fiscal years (1 October 2002 through 30  September 2004), except 
with respect to federal agricultural domestic s upport programmes and export assistance programmes.  
Information regarding federal domestic agricultu ral support programmes covers fiscal years 2000, 
2001 and 2002 (1 October 1999 through 30 Septembe r 2002) and information regarding federal 
agricultural export assistance programmes covers  fiscal year 2003 (1 October 2002 through 
September 2003).  Information on programmes granted or maintained at sub-federal levels in the 
United States is included in Attachment I.     G/SCM/N/123/USA 
Page 2  
 
  AGRICULTURE 
 
EXPORT ASSISTANCE PROGRAMMES 
 
Title: The Export Enhancement Program (EEP) 
 
 Period covered by the notification
 
  The period covered is fiscal year 2003 (October 2002 - September 2003).   
 
 Policy objective and/or purpose
 
  In June 1991, the US Department of Agri culture (USDA) published programme criteria 
governing the selection of proposed sales initiatives u nder the EEP.  All EEP initiatives are evaluated 
based on five criteria:   
 
• Trade Policy Effect - the expected contri butions of the initiative in furthering the 
US trade policy objectives;  
• Export Effect - the potential to develop, expa nd, or maintain markets for US agricultural 
commodities;   
• Effect on Non-subsidizers - possible effects, if any, on non-subsidizing exporters of 
agricultural products;   
• Subsidy Requirements - the expected benefits  compared with expected costs of the 
initiative;  and 
• Market Development - extent to which initia tive can be used for market development 
purposes.   
  The overall programme level for EEP, as well as bonus awards under individual EEP 
initiatives, will be maintained at the minimum levels necessary to achieve the expected benefits of the 
programme's export expansion objectives, as well as the anticipated long -term benefits from 
multilateral agricultural trade reform.  Together, these criteria are considered in the selection of 
initiatives targeting specific commodities and countries that will best meet the programme's trade 
policy and export expansion objectives.     Effective 1 July 1995, the terms of the Uruguay Round Agreement on Agriculture established annual ceilings by commodity with respect to  maximum quantity and budgetary expenditures 
permitted for export subsidies.   
  Background and authority
 
  The EEP has operated under various authoriti es since May 1985.  Terms and conditions 
applicable to all export initiatives are contained in the US Code of Fe deral Regulations at 
7 CFR 1494.     Form
 
  Cash bonuses paid to participating agricultural exporters.   
 
 Amount
 
  Fiscal Year 2003 – None (not used).     G/SCM/N/123/USA 
 Page 3 
 
 
   Duration  
  Section 301 of the Agricultural Trade Act of 1978, as amended, authorizes spending through 30 September 2007.    
 Trade effects
 
  The EEP programme has not been used since fiscal year 2000.  Therefore, there are no trade 
effects.    
 
Title: The Dairy Export Incentive Program (DEIP)  
 
 Period covered by the notification
 
 
 The period covered is fiscal year 2003 (October 2002 - September 2003).   
  Policy objective and/or purpose
 
  In June 1991, USDA published programme cr iteria governing the selection of commodities 
and countries under the DEIP.  These criteria take into account:   
 
• Trade Policy Effect -- the expected contribution of the initiative in furthering US trade 
policy objectives;   
• Export Effect -- the potential to develop, expand, or maintain markets for US agricultural 
commodities;   
• Effect on Non-subsidizers -- the possible effects on non-subsidizing exporters of 
agricultural products;  and 
• Subsidy Requirements -- the expected benefits  compared with the expected costs of the 
initiative.   
 
 Effective 1 July 1995, the terms of the Uruguay Round Agreement on Agriculture established annual ceilings by commodity with respect to  maximum quantity and budgetary expenditures 
permitted for export subsidies.  Section 148 of the FAIR Act authorized the use of DEIP to any 
destination in the world for the purpose of mark et development provided those shipments are not 
otherwise restricted by US law.   
 
Background and authority
 
  The Farm Security and Rural Investment Act of 2002 amended Section 153 of the Food Security Act of 1985 to mandate the CCC opera te the DEIP through 31 December 2007.   
 
To whom and how assistance is provided
 
  Payments may be made in cash, CCC-owned commodities, or generic certificates on a bid basis to entities that sell US dairy products for e xport.  Export sales under the programme must be in 
addition to, and, to the extent practicable, not displace, commercial export sales of US dairy products.  
Eligible dairy products, in bulk, are butter, butte r oil, anhydrous milk fat, non-fat dry milk, whole 
milk powder, cheddar cheese, mozz arella cheese, cream cheese, fe ta cheese, and Gouda cheese.   
 G/SCM/N/123/USA 
Page 4  
 
  Amount
 
  Note:  Notifications to the Committee on Agri culture report quantity on July-June year basis 
and budgetary outlays on fiscal year basis.   
 
Fiscal Year 2003 Butter and Butter Oil Quantity 10,000 MT  Budgetary Outlays $15,506,440 
Skim Milk Powder Quantity 68,200 MT    Budgetary Outlays $14,797,395 
Cheese    Quantity 3,029 MT    Budgetary Outlays $1,222,155  
Duration
 
 
Section 153 of the Food Security Act of 1985, as amended, authorizes the programme through 
31 December 2007.    
Trade effects
 
  The CCC bonuses offered are intended to enable  US exporters to compete at commercial 
prices in selected foreign markets.  The effect of th e programme is to enable exporters to offer prices 
that are competitive with those being offered by other countries' exporters in these selected foreign 
markets.     
AGRICULTURAL SUPPORT PROGRAMMES 
 
Title: Agriculture Income Support and Marketin g Assistance for Wheat, Feed Grains (Corn, 
Grain Sorghum, Barley, Oats, and Rye), Upla nd and Extra Long Staple (ELS) Cotton, 
Rice, Oilseeds (Soybeans, Sunflower Seed, Flaxseed, Canola, Rapeseed, Safflower, and 
Mustard Seed), and Price Support for Peanuts, Milk, Sugar, and Tobacco Programs.   
 
Period covered by notification
 
 
The period covered is fiscal years 2000, 2001, and 2002.   
 
Policy objectives  
 
• Stabilize, support, and protect farm income and prices.   
• Help ensure adequate supplies of quality food, feed and fiber.   
• Assist in the orderly marketing of farm commodities.   
 
Background and authority  
  These programmes were authorized by the Commodity Credit Corporation (CCC) Charter 
Act, the Agriculture Adjustment Act of 1938, as am ended, the Agricultural Act of 1949, as amended, 
and the Federal Agriculture Improvement and Refo rm Act of 1996 ("1996 Act").  The programmes 
were financed by the CCC and administered  by the Farm Service Agency (FSA).   
 
Programme Descriptions and Actual E xpenditures for Period of Notification
 
 (a) Production Flexibility Contract (PFC) Payments.   
 
No changes were made to this programme  in the period under notification.    G/SCM/N/123/USA 
 Page 5 
 
 
   Total maximum annual PFC paymen ts were established and fixed by law at the national level 
for each of the 7 years of the contract period (see table below).      
Table 1.  Production Flexibility Contract Payments by Fiscal Year  
1996-2002, in Billion US$ 
 
Amount  
1996  
1997  
1998  
1999  
2000  
2001  
2002  
Statutory 
Amount*  
5.570  
5.385  
5.800  
5.603  
5.130  
4.130  
4.008 
Actual 
Amount  
5.141  
6.320  
5.672  
5.476  
5.085  
4.101  
3.973 
 
*Excludes adjustments for deficiency payments for the 1994 and 1995 crops.  Amounts are those 
specified in section 113 of the Federal Agriculture Improvement and Reform Act of 1996.   
 
 (b) Non-recourse Marketing Assistance Loans and Loan Deficiency Payments (LDPs) for Wheat, 
Feed Grains, Upland and ELS Cotton, Rice, and Oilseeds. 
 
 There were no changes in the basic system on non-recourse commodity loans from 1999 
to 2001.     Commodity loan rates decreased from 1999 to 2000 only in the case of non-quota peanuts and grain sorghum.  The loan rates for barley and oats  increased.  Commodity loan rates did not decrease 
for any commodities from 2000 to 2001.   
 
 Actual total expenditures (combined LDPs, ma rketing loan gains, and certificate exchange 
gains) for 2000 and 2001 crops  totalled $6 billion and $8.2 billion, respectively.   
  Marketing assistance loans for each commodity ha ve a term of 9 months beginning on the first 
day of the first month after the month in which the loan is made.  For ELS and upland cotton, the loans 
have a term of 10 months beginning on the first da y of the month in which the loan is made.   
 (c) Peanuts  
 No changes were made to the way in which this programme was administered in the period 
under notification.     For 2000-crop and 2001-crop, the national pounda ge quota was set at 1.18 million short tons.   
  The loan rate for both the 2000 and 2001-crop quota was $610 per short ton, and the loan rate 
for additional peanuts was $132 pe r short ton ($0.305 pe r pound and $0.06 per pound, respectively).   
  Peanut payments totalled $55 million in FY 2000 and $118 milli on in FY 2001.   
 (d) Dairy Products 
 
No changes were made to the programme  in the period under notification.   
  The support price of milk was $9.90 per hundred weight (cwt) for calendar years (CY) 2000, 
2001, and 2002.  Actual net e xpenditures were $471 million in FY 2000, $433 million in FY 2001, 
and $570 million in FY 2002.   G/SCM/N/123/USA 
Page 6  
 
  (e) Sugar 
  During fiscal years 2000 and 2001, sugar loan s continued to be issued on non-recourse 
commodity loans.  Sugar loans were unchanged at 18 cents per pound for raw cane sugar, and 22.90 cents per pound for refined beet sugar.  In  the event of forfeiture, processors are assessed a 
penalty of 1 cent per pound in the case of raw cane sugar and 1.364 cents per pound for refined sugar, 
thus essentially reducing the effective level of price support by about 1 cent per pound. 
  The sugar programme operates under a "no-cost" provision.  Actual net expenditures on this 
programme were $465 million in FY 2000, $31 million in FY 2001, and -$130 million in FY 2002.  
(The negative sign (-) indicates net revenues from the programme).   
 (f) Tobacco  
 National avg. loan level ($/lb) National marketing quota (mil. lb) 
Crop Year 2000 2001 2002 2000 2001 2002 
Flue-cured 1.64 1.66 1.66 543 548 582 
Burley 1.81 1.83 1.84 247 331 287 
 
 The tobacco support programme is statutorily mandated to operate at no net cost to the 
government, and a no-net-cost assessment is impo sed on every pound of tobacco marketed.   
  Actual net expenditures on this programme for the 2000, 2001, and 2002 crop years respectively were $657 million, $386 million, and -$ 137 million.  (The negative sign (-) indicates net 
revenues from the programme).   
 (g) Special Emergency Provisions of the Agri culture, Rural Development, Food and Drug 
Administration, and Related Agencies, Appropriations Act, 2000 (Pub. L. 106-78), enacted October 1999 
 
 Crop Loss Assistance 
  Emergency financial assistance was provided to producers on farms that incurred losses in a 1999 crop due to a disaster in the same manner as assistance provided for losses under the FY 1999 Act.  The losses covered include quantity losses,  quality losses, and severe economic losses due to 
damaging weather or related condition.   
  The FY 2000 Act appropriated $1.2 billion for th is assistance which was later increased 
by $186 million under the FY 2000 Omnibus Appr opriation Act (Public Law 106-113, enacted 
29 November 1999).  Outlays totalled $1.251 billion.   
 
 Mohair Recourse Loans 
  Recourse marketing assistance loans are conti nued for mohair produced before or during 
FY 2000 in the same manner as under the FY 1999 Act.  All loans must be repaid, and mohair may not 
be delivered to CCC in satisfaction of the loan obligation.  No loan programme was provided for 
FY 2001 or 2002 production.  
  Honey Marketing Loans 
 
 The recourse marketing assistance loan pr ogramme for honey was converted to a non-
recourse programme with marketing loan gain prov isions in 2000 (Section 812, Public Law 106-387).   G/SCM/N/123/USA 
 Page 7 
 
 
  The loan programme for honey was not continued in 2001.  Recourse loan net expenditures were 
$7 million for FY 2000, $23 million for FY 2001, and -$3 million for FY 2002.  (The negative sign (-) 
indicates net revenues from the programme).     Emergency Supplemental Income Support for PFC Contract Holders 
 
 Market loss assistance (MLA) was provided to PFC contract holders (individuals or entities) 
in fiscal years 2000, 2001, and 2002 as a post-hoc pr ogramme.  As with PFC payments, no production 
of any kind was required as a condition to receive the MLA payments.  MLA was discontinued after fiscal year 2002.   
 
 To receive market loss assistance, an individual or entity must have been enrolled in the 7 year 
Production Flexibility Contract (PFC) programme by 1 August 1996.     Payments under the MLA were $5.6 billi on in FY 2000, $5.3 billion in FY 2001, 
and $426 thousand in FY 2002.   
 
Oilseed Payments 
 
 This programme makes payments available to producers of oilseeds that were eligible to 
receive marketing assistance loans for the 1999 crop.   Payments were prorated on the basis of 
production volumes.   
  Payments totalled $460 million in FY 2000 and, $921 million in FY 2001.  No payments were 
made in FY 2002.    
Livestock Assistance Program 
  This programme provides assistance for lo sses for livestock producers that have suffered 
grazing losses due to natural disaster.  Budget outla ys were $188 million in FY 2000, $427 million in 
FY 2001, and $0 in FY 2002.    
Dairy Market Loss Assistance Program 
  Dairy MLA payments were made for eligible producer losses.     Payments were $123 million in FY 200 0 and $672 million in FY 2001.   
 
 User Marketing (Step 2) Payments for Upland Cotton and the Special Competitiveness 
Program for extra long staple (ELS) Cotton.     Provisions for Special Competitiveness Program payments for extra-long staple (ELS) cotton 
were announced early in 2000.   
 
 User marketing payments for both Step 2 upland cotton and the Special Competitiveness 
Program for ELS cotton combined totalled $236.5 m illion in FY 2001, and $182 million in FY 2002. 
 
Cottonseed Market Loss Assistance Payments 
 
 This programme made payments available to  producers and first-handlers of cottonseed.  
Payments totalled $78.7 million in FY 2000 and $184.6 million in FY  2001.  No cottonseed payments 
were made in FY 2002.    G/SCM/N/123/USA 
Page 8  
 
  Duration
 
  The policies described were in eff ect for FY 2000, 20 01, and 2002.   
 
Trade effects
 
 
 It is difficult to determine to what extent, if  any, these programmes have affected trade, given 
the existence of other policy instrument s that affect agricultural trade.   
  
OTHER AGRICULTURAL PROGRAMMES
1 
 
Title: Expensing of Certain Capital Outlays Related to Agriculture 
 
Period covered by the notification  
  The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose
 
  To promote soil and water conservation.    
Background and authority
 
 
 Section 175 of the Internal Revenue Code (covering soil and water conservation expenses), 
enacted as part of the Revenue Act of 1954, and se ction 180 (covering fertilizer expenses), enacted 
in 1960 as part of Public Law 86-779.  
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
 
 Farmers, except for certain farm corporations  and partnerships, are allowed to deduct certain 
expenditures for fertilizer and other materials used to enrich or condition farmland, as well as for soil 
and water conservation measures.  Expensing is allowed, even though these expenditures are for 
inventories held beyond the end of the year, or for capital improvements that would otherwise be 
capitalized.  The deduction for conservation expen ses is limited annually to 25 per cent of the 
taxpayer's gross income from farming.   
 
Amount  
  The revenue loss was $120 million in 2003 and $100 million in 2004.   
 
Duration
 
  Indefinite.   
                                                     
 
1 All the programmes in this section are tax-related, authorized under the US Internal Revenue Code.    G/SCM/N/123/USA 
 Page 9 
 
 
  Trade effects  
  It is not possible to estimate what, if any,  trade effects may result from the use of these 
provisions.    
 
Title: Expensing of Multi-period Livestock and Crop Production Costs 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To ease record-keeping for small farm businesses.   
 
 Background and authority
 
  Section 263A of the Internal Revenue Code, enact ed as part of the Tax Reform Act of 1986.   
 
Form
 
 
 Income tax concession.    
To whom and how assistance is provided
 
 
 The production of livestock and crops with a production period of two years or less is 
exempted from the uniform capitalization rules.   Farmers producing any goods for sale with a 
production period of two years or less may elect not to capitalize costs.    
Amount
 
 
 The revenue loss was $50 million per year in 2003 and 2004.   
 
Duration  
  Indefinite.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.    
 
Title: Treatment of Loans Forgiven  Solvent Farmers as if Insolvent 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To address certain consequences of farm credit crises.   G/SCM/N/123/USA 
Page 10  
 
  Background and authority
 
  Sections 108 and 1017 of the Internal Revenue  Code, enacted as part of the Tax Reform Act 
of 1986.    
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
 
 Farmers are granted special tax treatment by  being forgiven the tax liability on certain 
forgiven debt.  Normally, the amount of loan forg iveness is accounted for as a gain (income) of the 
debtor, who must either report the gain or reduce his recoverable basis in the property to which the 
loan relates.  If the debtor elects to reduce basi s and the amount of forgiveness exceeds his basis on 
the property, the excess forgiveness is taxable.  Howe ver, in the case of insolvent (bankrupt) debtors, 
the amount of loan forgiveness never results in an in come tax liability.  Farmers with forgiven debt 
are considered insolvent for tax purposes, and thus  qualify for income tax forgiveness.  This relief 
applies only if at least 50 per cent of the taxpayer' s gross receipts for the three tax years preceding the 
tax year in which the discharge of indebtedn ess occurs is attributable to farming.   
 
Amount  
  The revenue loss was $10 million per year in 2003 and 2004.    
Duration
 
 
 Indefinite.    
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
  
Title:  Capital Gains Treatment of Certain Agricultural Income 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To ensure that when farmland is sold, any immature, unharvested crops growing on the land 
are treated for tax purposes as part of the land and not as personal property ready for sale to customers.    
Background and authority
 
 
 Section 1231 of the Internal Revenue Code.   G/SCM/N/123/USA 
 Page 11 
 
 
  Form  
  Income tax concession.    
To whom and how assistance is provided
 
 
 Certain agricultural income, which would norma lly be taxed as ordinary income, such as 
receipts from the sale of unharvested crops sold together with farmland, can be treated as capital gains.  Income tax rates for individuals on ordi nary income ranged from 10 per cent to 35 per cent 
in 2003 and 2004.  For individual taxpayers, long-term capital gains are taxed separately from other 
income, generally at 5 per cent and 15 per cent rates.   
 
Amount
 
  The revenue loss was $1,050 million in 2003 and $670 million in 2004.   
 
Duration
 
  Indefinite;  this has been a permanent provision since at least 1954.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.    
 
Title: Exemption from Excise Tax for Toba cco Products Supplied to Their Employees by 
Tobacco Product Producers 
 
Period covered by notification
 
  The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose
 
  To permit producers of tobacco products to suppl y their workers with free cigarettes and other 
tobacco products.   
 
Background and authority
 
  Section 5704(a) of the Internal Revenue Code.    
Form
 
 
 Exemption from otherwise applicable excise tax.    
To whom and how assistance is provided
 
 
 Producers of tobacco products may furnish lim ited quantities of tobacco products for use or 
consumption by employees without payment of tax. G/SCM/N/123/USA 
Page 12  
 
  Amount
 
  The subsidy per unit amounts to the following:  (i) for cigarettes, $19.50 per thousand;  (ii) for cigars, $1.828 to $48.75 per thousand (depending on size);  (iii) for s nuff, $0.585 per pound;  (iv) for 
chewing tobacco, $0.195 per pound;  and (v) for pipe  tobacco and roll-your-own tobacco, $1.0969 per 
pound.   
 
Duration
 
  Indefinite.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of these 
provisions.  
 
 
ENERGY & FUELS
2 
(ENERGY DEVELOPMENT, STORAGE AND TRANSPORTATION 
& OTHER RELATED SECTORS)  
 
Title:  Renewable Energy Resources  
 
Periods covered by the notification  
  The periods covered by the notification are fiscal years 2003 and 2004.   
 
Policy objective and/or purpose
 
 
To lead the national effort to develop renewable energy technologies, to accelerate acceptance 
and use of renewable energy technologies and to improve the United States' overall economic, energy 
security, and environmental health through the development of clean, competitive power 
technologies.   
 
Background and authority  
  This programme is administered by Depart ment of Energy's (DOE) Office of Energy 
Efficiency and Renewable Energy (EERE).  Legislative authority derives from:   
  P.L. 93-409, "Solar Heating and Cooling Demonstration Act" (1974)  P.L. 93-410, "Geothermal Energy Research, Development and Demonstration Act" (1974) 
 P.L. 94-163, "Energy Policy and Conservation Act" (EPCA) (1975)  P.L. 94-385, "Energy Conservation and Product Act" (ECPA) (1976) 
 P.L. 95-91, "Department of Energy Organization Act" (1977) 
 P.L. 95-618, "Energy Tax Act of 1978"  P.L. 95-619, "National Energy Con servation Policy Act" (NECPA) (1978) 
 P.L. 95-620, "Power plant and I ndustrial Fuel Use Act of 1978" 
 P.L. 96-294, "Energy Security Act" (1980) 
 P.L. 100-12, "National Applian ce Energy Conservation Act of 1987" 
                                                     
 
2 Please note that many of the energy programme names in this notification differ from the names in 
the notification provided in 2003.  However, the subs tance of the programmes have generally remained the 
same.    G/SCM/N/123/USA 
 Page 13 
 
 
   P.L. 100-615, "Federal Energy Management Improvement Act of 1988" 
 P.L. 101-218, "Renewable Energy and Ener gy Efficiency Technology Competitiveness Act 
of 1989" 
 P.L. 101-549, "Clean Air Act Amendments of 1990"  P.L. 101-575, "Solar, Wind, Waste, and Geothermal Power Production Incentives Act 
of 1990" 
 P.L. 104-271, "Hydrogen Future Act of 1996"  P.L. 106-224, "Biomass Research  and Development Act of 2000" 
  Annual appropriations are contained in the Energy and Water Deve lopment Appropriations 
Act for fiscal years 2003 and 2004 and the Depart ment of the Interior and Related Agencies 
Appropriations Act for fiscal  years 2003 and 2004.   
 
Form
 
 
 Grants, cooperative agreements, c ooperative research and development 
agreements (CRADAs)3 and other forms of collaboration acco mplished through consortium-based 
activities between government laboratories and private industry.    
To whom and how assistance is provided
 
 
 Participation in the programme is determined  through various competitive procedures, which 
are open to all eligible private parties.  
Amount
 
 
 Fiscal years 2003 and 2004 annual appropriati ons (approximate dollars in millions).   
          FY 2003
 FY2004
   Total, Renewable Energy Resources 318.5  338.7  
 
          FY 2003
 FY2004  
Sub-Programmes  
 Biomass/Biofuels Energy Systems   101.0      86.9 
Wind Energy Systems         41.6     41.3 
Solar Energy   89.9     83.4 
Geothermal Technology De velopment Program   28.4     25.5 
Hydrogen Research   38.1     82.0 
                                                     
 
3 The term "CRADA" has a specific meaning as a result of legislation and regulations developed to 
implement a variety of US technology promotion and commercialization programmes.  Generally, however, a 
CRADA is a negotiated, contractual ag reement between a federal agency or  agency laboratory and a private 
sector partner or partners (including universities and independent research institutions) in which the parties agree on the designation of personnel, facilities, equipm ent and other resources to a collaborative R&D activity, 
as well as to the disposition of any intellectual property which the R&D yields.  A CRADA is just one of several 
legal instruments or mechanisms through which government agencies work in partnership with business and academia in pursuit of shared or co mplementary R&D objectives.  Exampl es of other such instruments are 
"cooperative agreements", contracts and grants.   G/SCM/N/123/USA 
Page 14  
 
  Hydropower     5.0       4.9 
Electricity Reliability   76.5     76.8 
International Renewable Energy Program      3.9       5.9 
Renewable Energy Production Incentive Program     4.8       3.9  
Renewable Indian Energy Resources     5.8       4.9 
 
Duration
 
  The Renewable Energy Resources Program is not  subject to any fixed completion date.  Its 
continuation is contingent upon ongoing annual a ppropriations and authorizations by Congress. 
 
Trade Effects
 
  In light of the scope and nature of the R& D activities being assisted, it is not possible to 
determine what, if any, trade effects may ever result from this programme.   
 
 
Title:  Energy Conservation Programs -- Transportation Sector  
 
Periods covered by the notification
 
 
 The periods covered by the notification are fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To support development and use of advanced  vehicle technologies and fuels which reduce 
demand for petroleum, decrease emissions of cr iteria air pollutants and greenhouse gases, and to 
enable the US transportation industry to sustain a strong, competitive positio n in domestic and world 
markets.    
Background and authority
 
 
 This programme is administered by DOE's Office of Energy Efficiency and Renewable 
Energy Office of Transportation Technologies (EERE-OTT).  Legislative authority derives from:     P.L.93-275, Federal Energy Administration Act of 1974  P.L. 93-577, Federal Non-nuclear Ener gy Research and Development Act of 1974 
 P.L. 94-163, Energy Policy and Conservation Act (1975) 
 P.L. 94-413, Electric and Hybrid Vehicle Research, Development and Demonstration Act 
of 1976 
 P.L. 95-91, Department of Energy Organization Act (1977)  P.L. 95-238, Title III - Automotive Propulsion Research and Development Act of 1978  P.L. 96-512, Methane Transportation Research, Development and Demonstration Act of 1980 
 P.L. 100-494, Alternative Motor Fuels Act of 1988 
 P.L. 102-486, Energy Policy Act of 1992   Annual appropriations are contained in the Depa rtment of the Interior  and Related Agencies 
Appropriations Acts for fiscal years 2003 and 2004.    G/SCM/N/123/USA 
 Page 15 
 
 
  Form  
  Assistance under the programme is provide d through grants, cooperative agreements, 
CRADAs
4 and other forms of collaboration accomp lished through consortium-based activities 
between government laboratories and private industry.   
 
To whom and how assistance is provided  
  Participation in the programme is determined  through various competitive procedures, which 
are open to all eligible private parties.   
 
Amount
 
  Fiscal years 2003 and 2004 annual appropria tions (approximate dollars in millions)  
 
          FY 2003
      FY 2004
  
 Total, Energy Conservation, Transportation Sector                                       220.8                     235.7 
Sub-Programmes  
 Vehicle Technologies R&D  158.9         172.0 
Vehicle Systems Fuel Cell R&D Advanced Combustion Engine R&D Innovative Concepts 
Hybrid and Electric Propulsion 
 
Fuels Technology  19.2           16.5 
 Advanced Petroleum Based Fuels (APBF) 
Non-Petroleum Fuels/Lubricants Environmental Impact 
 
Materials Technology 36.1           39.7 
Propulsion Materials Technology Lightweight Materials Technology High Temperature Materials Laboratory 
 
Technology Introduction   4.6             4.9 
Technical/Program Management Support                                                        2.0             2.1 
Biennial Peer Reviews                                                                                         0.0                 0.5 
 
Duration
 
 
 The programme is not subject to any fixed co mpletion date.  Its continuation is contingent 
upon ongoing annual appropriations and authorizations by Congress. 
 
                                                      
4 See footnote 3, above.   G/SCM/N/123/USA 
Page 16  
 
  Trade Effects
 
  In light of the scope and nature of the R& D activities being assisted, it is not possible to 
determine what, if any, trade effects may ever result from this programme.  
 
Title: Energy Conservation Programs - Buildi ng Technology, State and Community Sector  
 
Periods covered by the notification
 
 
 The periods covered by the notification are fiscal years 2003 and 2004.   
 
Policy Objective and/or purpose  
  In partnership with industry and government, the Office of Energy Efficiency and Renewable 
Energy, the Office of Building Technologies (BT), the Office of Weatherization and 
Intergovernmental Programs (OWIP), and the O ffice of Federal Energy Management Programs 
(FEMP) develops, promotes, and integrates energy  technologies and practices that make buildings 
more efficient, productive, and affordable.    
Background and Authority
 
 
 Legislative authority derives from:     P.L. 94-163, Energy Policy and Conservation Act (1975)  P.L. 94-385, Energy Conservation and Production Act (1976) 
P.L. 95-91, Department of Energy Organization Act (1977) 
 P.L. 95-618, Energy Tax Act of 1978  P.L. 95-619, National Energy Conservation Policy Act (1978)  P.L. 95-620, Power Plant and Industrial Fuel Use Act of 1978  P.L. 96-294, Energy Security Act (1980)  P.L. 100-12, National Appliance Energy Conservation Act of 1987 
 P.L. 100-615, Federal Energy Management Improvement Act of 1988 
 P.L. 102-486, Energy Policy Act of 1992   Annual appropriations are contained in the Depa rtment of the Interior  and Related Agencies 
Appropriations Act for fiscal  years 2003 and 2004.   
 
Form
 
  Assistance under the programmes is provide d through grants, cooperative agreements, 
CRADAs
5 and other forms of collaboration accomp lished through consortium-based activities 
between government laboratories and private industry.   
 
To whom and how assistance is provided  
  Participation in the programmes is determined  through various competitive procedures, which 
are open to all eligible parties.   
 
 
                                                     
 
5 See footnote 3 above.    G/SCM/N/123/USA 
 Page 17 
 
 
  Amount  
  Fiscal years 2003 and 2004 annual appropriati ons (approximate dollars in millions).   
                  F Y  2 0 0 3
      FY 2004  
 
Total, Building Technology, State and Community Sector          373.2         372.6 
 
Sub-programmes  
 Building Technologies        58.3           59.9 
Equipment Standards and Analysis       Residential Buildings Integration  Commercial Buildings Integration Emerging Technologies 
 
Building Technology Assistance  314.9         312.7 
Weatherization Assistance State Energy Program Gateway Deployment (including Energy Star Program) Federal Energy Management 
 
Duration
 
  The programme is not subject to any fixed co mpletion date.  Its continuation is contingent 
upon ongoing annual appropriations a nd authorizations by Congress.   
 
Trade Effects
 
  In light of the scope and nature of the R& D activities being assisted, it is not possible to 
determine what, if any, trade effects may ever result from this programme.   
 
 
Title: Energy Conservation - Industry Sector  
 
Periods covered by the notification
 
 
 The periods covered are fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To improve the energy efficiency, environmen tal performance, and productivity of energy-
intensive industries by developing and delivering advanced science and technology options.   
 
Background and Authority
 
  These programmes are administered by the Department of Energy, Office of Energy Efficiency and Renewable Energy, Office of Industrial Technologies (OIT).  Legislative authority 
derives from:   
  P.L. 102-486, "Energy Policy Act of 1992"  P.L. 94-163, "Energy Policy and Conservation Act" (EPCA) (1975)  P.L. 94-385, "Energy Conservation and Production Act" (ECPA) (1976) G/SCM/N/123/USA 
Page 18  
 
   P.L. 95-91, "Department of Energy Organization Act" (1977) 
 P.L. 95-618, "Energy Tax Act of 1978"  P.L. 95-619, "National Energy Con servation Policy Act" (NECPA) (1978) 
 P.L. 95-620, "Power Plants and Industrial Fuel Use Act of 1978"  P.L. 96-294, "Energy Security Act" (1980) 
 P.L. 100-12, "National Applian ce Energy Conservation Act of 1987" 
 P.L. 100-615, "Federal Energy Management Improvement Act of 1988"  P.L. 101-218, "Renewable Energy and Ener gy Efficiency Technology Competitiveness Act 
of 1989" 
 P.L. 101-549, "Clean Air Act Amendments of 1990" 
 P.L. 101-575, "Solar, Wind, Waste, and Geothermal Power Production Incentives Act 
of 1990" 
 P.L. 93-577, "Federal Non-Nuclear Energy Research and Development Act of 1974"  P.L. 106-224, "Biomass Research  and Development Act of 2000" 
 
 Annual appropriations are contained in the Depa rtment of the Interior  and Related Agencies 
Appropriations Act for fiscal  years 2003 and 2004.   
 
Form
 
  Assistance under the programmes is provide d through grants, cooperative agreements, 
CRADAs
6 and other forms of collaboration accomp lished through consortium-based activities 
between government laboratories and private industry.    
To whom and how assistance is provided
 
 
 Participation in the programmes is determined  through various competitive procedures, which 
are open to all eligible private parties.     Amount
 
  Fiscal years 2003 and 2004 annual appropriati ons (approximate dollars in millions).   
 
                 F Y  2 0 0 3
      FY 2004  
   Total, Industrial Sector   103.3          97.3 
 Sub-programmes  
 
Industries of the Future (Specific)  59.3         47.2 
Forest and Paper Products Steel Industry Aluminium Industry 
Metal Casting Industry 
Glass Industry  Chemicals Industry Mining Industry Agriculture Industry 
Supporting Industries 
 
                                                     
 
6 See footnote 3 above.    G/SCM/N/123/USA 
 Page 19 
 
 
  Industries of the Future (Crosscutting) 40.0        44.2 
Gasification Programs Advanced Industrial Materials Industrial Materials for the Future Combustion 
Sensors & Automation 
Inventions and Innovation NICE 3 Industrial Technical Assistance Robotics 
 
Technical/Program Management Support 4.0        5.9 
 
Duration
 
 
 The programme is not subject to any fixed co mpletion date.  Its continuation is contingent 
upon ongoing annual appropriations a nd authorizations by Congress.   
 
Trade Effects  
  In light of the scope and nature of the R& D activities being assisted, it is not possible to 
determine what, if any, trade effects may ever result from this programme.   
  
Title: Fossil Energy Research and Development  
 
Periods covered by the notification
 
  The periods covered are fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 The programme's goal is to ensure that economic  benefits from moderately priced fossil fuels 
and a strong domestic industry, which creates domestic  jobs, are compatible with the expectation for 
exceptional environmental quality and reduced energy security risks.    
Background and authority
 
 
 The programme is administered by the DOE Offi ce of Fossil Energy.  Legislative authority 
for the programme derives from Title XX, Section 2011  of the Energy Policy Act of 1992 and the 
Department of the Interior and Related Agencies Appropriation Act for Fiscal years 2003 and 2004.   
 
Form:  to whom and how assistance is provided  
 
 To ensure that federally funded research and development technologies and analyses are 
relevant to market and public needs, and transfe rred to commercial applications, the Office of Fossil 
Energy participates in joint partnerships with industry utilizing mechanisms  such as cost-shared 
contracts and CRADAs.7   
 
                                                      
7 See footnote 3 above.   G/SCM/N/123/USA 
Page 20  
 
  Amount
 
  Fiscal years 2003 and 2004 Appropriations (approximate dollars in millions).   
          FY 2003
    FY 2004  
 
Total, Fossil Energy Research and Development 611.1        383.1 
 
Subprogrammes  
 President's Clean Research Initiative 338.6        383.1  
Clean Coal Power Initiative
8 
Central Systems Sequestration Fuels 
Advanced Research 
 Other Power Systems     62.0         72.0  
 Distributed Generation Systems  
 
Natural Gas Research                                                                                      45.9                     43.0  
Petroleum - Oil Technology 50.0          35.5  
Cooperative Research and Development     8.0           8.5 
 
Duration
 
 
 While it is not subject to any fixed comp letion date, the programme's continuation is 
contingent upon ongoing annual appropriations by the Congress.   
 
Trade effects  
  In light of the scope and nature of the activities being assisted, it is not possible to determine 
what, if any, trade effects may ever result from this programme.   
 
 
OTHER ENERGY AND FUELS
9 
 
Title: Expensing of Exploration and Developm ent (E&D) Costs for Oil, Gas and other Fuels 
 
Period covered by the notification  
 The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
 
 To encourage the development of domes tic oil, gas and coal resources.   
 
                                                      
8 Beginning in fiscal year 2003, all remaining balances of the Clean Coal Technology Demonstration 
programme are included as part of the Clean Coal Power Initiative.   
9  The programmes in this section are tax-related, authorized under the US Internal Revenue Code.    G/SCM/N/123/USA 
 Page 21 
 
 
  Background and authority  
  In the case of successful investments in domes tic oil and gas wells, intangible drilling costs, 
such as wages, the costs of using machinery for gr ading and drilling and the costs of unsalvageable 
materials used in constructing we lls, may be expensed for tax purposes rather than amortized over the 
productive life of the property.  Integrated oil companies may currently deduct only 70 per cent of 
such costs and amortize the remaining 30 per cent ove r five years.  The same rule applies to the 
exploration and development costs of surface strippi ng and the construction of shafts and tunnels for 
other fuel minerals.  The expensing provision is authorized under sections 263(c), 291, 616-617, 
57(2), and 1254 of the Internal Re venue Code of 1986.  Th e expensing of intangible drilling costs was 
originally established in a 1916 Treasury regulation w ith the rationale that such costs were ordinary 
operating expenses.  Limitations on expensing for in tegrated oil companies were applied in 1976 and 
later years.    
Form
 
 
 Income tax concession.    
To whom and how assistance is provided
 
  Fuel mineral producers are permitted acceler ated deductions from taxable income.   
 
Amount
 
  The revenue loss was $210 million in 2003 and $260 million in 2004.   
 
Duration
 
  Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     
Title: Excess of Percentage Over Cost De pletion for Oil, Gas and Other Fuels 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To stimulate the supply of oil and gas,  compensate producers for the high risks of 
prospecting, and relieve the tax bur dens of small-scale producers.  
 
Background and authority  
 
 Independent ( i.e., non-integrated) fuel mineral producer s and royalty owners are generally 
allowed to take percentage depl etion deductions rather than cost depletion on limited quantities of 
output for tax purposes.  Under cost depletion, outl ays are deducted over the productive life of the 
property based on the fraction of the resource extract ed.  Under percentage de pletion taxpayers deduct G/SCM/N/123/USA 
Page 22  
 
  a percentage of gross income from mineral production at  rates of 15 per cent for oil, gas and oil shale, 
and 10 per cent for coal.  The deduction is limite d to 50 per cent of net income from the property, 
except for oil and gas where the deduction can be 10 0 per cent of net property income.  For domestic 
production from marginal wells, the 100 per cent of  net income limitation has been suspended for 
taxable years before 1 January 2006.  Additionally,  the percentage depletion deduction for all oil and 
gas properties may not exceed 65 per cent of the taxpayer's overall income  and is limited to 
365,000 barrels per year per taxpayer.  Production from geothermal deposits is e ligible for percentage 
depletion up to 65 per cent of net income, but with  no limit on output and no limitation with respect to 
qualified producers.  Unlike depreciation or cost depletion, percentage depletion deductions can 
exceed the cost of the investment.   
 
 Percentage depletion is authorized under sections 611-613, 613A, and 291 of the Code.  
Percentage depletion for oil and gas goes back to 1918 or before and was extended to coal and most 
other minerals in 1932.  The Tax Reduction Act of 1975 eliminated the percentage depletion 
allowance for major oil and gas companies and re duced the rate for independents to 15 per cent 
for 1984 and beyond.   
 
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
  Independent fuel mineral producers and royalt y owners are permitted deductions from taxable 
income for percentage depletion.    
Amount
 
  A deduction from income is allowed for the gr eater of cost or percentage depletion.  
Percentage depletion is 15 per cent of revenue fo r independent (smaller) oil and gas producers and 
10 per cent for coal producers.  The revenue  loss was $640 million in 2003 and $1,320 million 
in 2004.  
 
Duration
 
  Indefinite.    
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     Title: Alternative Fuel Production Credit  
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose
 
  To provide incentives for the private sector to increase the development of alternative 
domestic energy resources because of concern over oil import dependence and national security.    G/SCM/N/123/USA 
 Page 23 
 
 
  Background and authority  
  A tax credit of $3 per barrel (in 1979 dollars) of oil-equivalent pr oduction is provided for 
several forms of alternative fuels.  The credit be gins to phase out if the annual average unregulated 
wellhead price per barrel of domestic crude o il exceeds $23.50 (in 1979 dollars).  The credit is 
authorized under section 29 of the Internal Revenue Code and was instituted as part of the Crude Oil 
Windfall Profit Tax Act of 1980.    
Form
 
 
 Income tax concession.   
 
To whom and how assistance is provided  
  Producers and royalty owners of qualifying pro duction are permitted credits against federal 
income tax.   
 
Amount
 
  The revenue loss was $1,280 million in 2003 and $1,040 million in 2004.   
 
Duration
 
  For most qualifying fuels, the production tax cr edit was available through 2002, provided that 
the wells were drilled before 1993.  For gas pro duced from biomass, and synthetic fuels produced 
from coal or lignite, the credit is available through 20 07, provided that the facility is placed in service 
before July 1998.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
 
 
Title:  Capital Gains Treatment of Royalties on Coal 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
  To encourage the development of the domestic coal industry.   
 
Background and authority
 
  The capital gains tax treatment is authorized  under sections 1231 and 631 of the Internal 
Revenue Code.  When the capital gain rate is belo w the regular tax rate, the owner is not entitled to 
percentage depletion provided in section 613 of the Internal Revenue Code.   
 G/SCM/N/123/USA 
Page 24  
 
  Form
 
  Income tax concession.    
To whom and how assistance is provided
 
 
 Sales of certain coal under royalty contracts can  be treated as capital gains for tax purposes.  
Income tax rates for individuals on ordinary in come ranged from 10 per cent to 35 per cent in 2003 
and 2004.  For individual taxpayers, long-term capit al gains are taxed separately from other income, 
generally at 5 per cent and 15 per cent rates.   
 
Amount  
  The revenue loss was $100 million in  2003 and $70 million in 2004.   
 
Duration
 
  Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.    
Title: Enhanced Oil Recovery (EOR) Credit 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To increase the domestic supply of oil a nd to enhance the energy security of the 
United States.    
Background and authority
 
 
 An EOR tax credit is provided equal to 15 per cent of the taxpayer's costs for tertiary oil 
recovery on projects in the United States.  Qualif ying costs include tertiary injectant expenses, 
intangible drilling and development costs on a qualif ied enhanced oil recovery project, and amounts 
incurred for tangible depreciable property.  Thus, th is credit encourages use of tertiary methods in 
situations where it would not be profitable otherwise.  The EOR cr edit may not exceed taxpayer's net 
income tax in excess of 25 per cent of net regul ar tax liability above $25,000 or the tentative 
minimum tax.  The EOR tax credit is authorized under section 43 of the Code and was enacted as part 
of the Omnibus Budget and Reconciliation Act of 1990.    
Form
 
 
 Income tax concession.     G/SCM/N/123/USA 
 Page 25 
 
 
  To whom and how assistance is provided  
  Petroleum producers and royalty holders appl ying approved tertiary petroleum recovery 
methods receive a credit against federal income tax.    
Amount
 
  The revenue loss was $400 million in 2003 and $330 million in 2004.   
 
Duration
 
 
 Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     
Title:  New Technology Credit: Solar and Geothermal Energy Facilities 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.  
Policy objective and/or purpose
 
 
 To reduce US consumption of oil and natural gas by encouraging the commercialization of 
renewable energy technologies and to enhance national security.   
Background and authority
 
 
 A tax credit of 10 per cent of the basis of each energy property placed in service during any 
taxable year is available for investment in solar and geothermal energy facilities.  The tax credit is 
authorized by sections 46 and 48 of the Internal Reve nue Code.  Business tax credits were part of the 
Energy Tax Act of 1978 and were altered in subse quent legislation.  The Energy Policy Act of 1992 
made the credit permanent.   
 
 Form  
  Income tax concession.    
To whom and how assistance is provided
 
 
 The credit reduces income taxes fo r non-utility taxpayers that invest  in qualifying equipment.   
 
Amount  
 
 The revenue loss was less than $100 m illion per year in 2003 and 2004.   
 
Duration  
  Indefinite.   G/SCM/N/123/USA 
Page 26  
 
  Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.    
 
Title: Alcohol Fuel Credit and Partial Exem ption from Federal Excise Tax on Gasoline 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To encourage the substitution of alcohol fuel s produced from renewable sources for gasoline 
and diesel fuel.   
 
Background and authority
 
  The excise tax provision exempted gasohol, a motor fuel composed of at least 10 per cent 
alcohol (including methanol), which is not produc ed from petroleum, natural gas, coal, or peat, 
from 5.2 cents (6.0 cents for methanol) of the 18. 4 cents per gallon Federal excise tax on gasoline.  
Smaller exemptions were allowed for motor fuel with lower alcohol content.  Th ere is also an income 
tax credit for alcohol used as a fuel in applications where the excise tax is not  assessed.  This credit is 
equal to 52 cents per gallon for alc ohol (60 cents for methanol) used as a fuel.  In addition, small 
producers of ethanol are eligible for a 10 cent per ga llon income tax credit.  The credit is included in a 
taxpayer's income.   
  The alcohol fuel credits are authorized by sec tions 38 and 40 of the Internal Revenue Code.  
The excise tax exemption was authorized by secti ons 4041, 4081, and 4091 of the Code.  The alcohol 
fuels mixture credit and the pure alcohol fuels credit were enacted as part of the Crude Oil Windfall Profit Tax of 1980, at the rate of 40 cents per gallon for alcohol that was 190 proof or more, 
and 30 cents per gallon for alcohol  between 150 and 190 proof.  The credits were increased in 1982 
and 1984.  The Omnibus Reconcilia tion Act of 1990 reduced the credits to 54 cents and 40 cents for 
ethanol and ethanol blends and introduced the 10-cen t-per-gallon income tax credit for small ethanol 
producers.  In 1998, the Transportation and Equity Act for the 21
st Century reduced the alcohol fuel 
credit and excise tax exemption, as described above.   
 
Form  
  Income tax concession and reduced excise ta x rates on fuels containing alcohol.   
 
To whom and how assistance is provided
 
 
 The credits reduce federal income tax of qua lifying producers and blenders.  The seller of 
alcohol fuels containing at least 85 per cent alcohol  derived from natural gas pays the applicable, 
lower motor fuel excise tax rate.  The blender of ethanol-based fuels (and methanol not produced from 
petroleum, natural gas, coal or peat) who mixes et hanol or another qualified alcohol with gasoline or 
diesel fuel to produce gasohol or diesohol may purchase gasoline or diesel fuel from a seller at a 
terminal rack at excise tax-reduced  rates or receive a refund if he later mixes fully taxed fuels with 
alcohol; these mixtures must contain at least 5.7 per cent alcohol to enjoy the favourable excise tax treatment.     G/SCM/N/123/USA 
 Page 27 
 
 
  Amount  
  In 2004, the alcohol mixture (or blender's) cr edit and the pure alcohol fuel credit was 52 cents 
per gallon of ethanol (60 cents for methanol) of  at least 190 proof, and 38.52 cents per gallon of 
alcohol between 150 and 190 proof (45 cents for me thanol).  The 52 cents credit for ethanol is 
reduced to 51 cents for the period 2005-2010 and th e 38.52 cents credit for ethanol is reduced to 
37.78 cents.  The small ethanol producer credit is  10 cents per gallon of ethanol.  The revenue loss 
was $30 million in fiscal year 2003 and $30 in fiscal year 2004.     In lieu of the blender's credit, fuel etha nol blenders may have claimed an excise tax 
exemption.  The revenue loss for the excise tax exemption was $1,100 million in fiscal year 2003 and 
$1,450 million in fiscal year 2004.    
Duration
 
 
 The American Jobs Creation Act of 2004 eliminat es the reduced rates of excise tax for most 
alcohol-blended fuels and imposes the full rate of excise tax (18.3 cents per gallon on gasoline 
and 24.3 cents per gallon on diesel bl ended fuel) starting in 2005.  In  lieu of the reduced excise tax 
rates, the provision provides for an excise tax credit, the alcohol fuel mixture credit.  The alcohol mixture credit is 51 cents for each gallon of alcohol used by a person in producing an alcohol fuel mixture for sale or use in a trade or business of  the taxpayer.  For mixtures not containing ethanol 
(renewable source methanol), the credit is 60 cents pe r gallon.  Both the alcohol fuel mixture excise 
tax credit and the alcohol fuels income ta x credit expire at the end of 2010.   
 
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     Title : Credits for Electricity Production fr om Wind, Biomass, and Poultry Waste 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.  
Policy objective and/or purpose
 
 
 To encourage the development and utilizati on of electric generating technologies that use 
specified renewable energy resources, as opp osed to conventional fossil fuels.   
 
Background and authority  
 
 Taxpayers are allowed a 1.5 cents credit (a djusted for inflation) per kilowatt hour for 
electricity produced from qualified wind energy, "c losed-loop" biomass and poultry waste.  The credit 
is indexed for inflation after 1992.  The electricity must be produced from a facility owned by a taxpayer and it must be sold to an unrelated third part y.  The credit is allowed for the first ten years of 
production from a new facility.  The credit applies to  electricity produced by a wind energy facility 
placed in service after 31 December 1993, and before  1 January 2006, to electricity produced by a 
closed-loop biomass facility placed in service after 31 December 1992, and be fore 1 January 2006, 
and to a poultry waste facility placed in service afte r 31 December 1999, and be fore 1 January 2006.  
The provision for wind and biomass was adopted as part of the Energy Policy Act of 1992 and was G/SCM/N/123/USA 
Page 28  
 
  extended to poultry waste in the Tax Relief Extension Act of 1999.  This provision is authorized in 
section 45 of the Internal Revenue Code.    
Form
 
 
 Income tax concession.   
 
To whom and how assistance is provided  
  The credit reduces federal income taxes for taxpayers producing electricity from wind, 
biomass and poultry waste.   
 
Amount
 
  The amount of the credit is $ 0.015 per kilowa tt hour (adjusted for inflation), produced from 
qualified wind, biomass or poultry waste.  The cr edit amount was $0.018 per kilowatt hour in 2003 
and 2004.  The revenue loss was $280 million in 2003 and $330 m illion in 2004.   
 
Duration
 
  The tax credit applies to new facilities placed in service before 2006.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
 
 
FISHERIES
10 
 
Title:   Fisheries Finance Program (FFP) 
 
 Prior to 1996, this programme was known the Fisheries Obligation Guarantee (FOG) 
Program.    
 
Period covered by the notification  
  The period covered is fiscal year 2003 and 2004.  
Policy objective and/or purpose
  
  The purpose of FFP is to provide fixed-rate fi nancing with a term equal to the estimated 
useful life of the equipment financed.  The predecessor programme – the FOG Program – which 
operated from 1972 through 1990, provided govern ment-backed loan guarantees to the 
US commercial fishing sector for the construction,  reconstruction, replacement and, under certain 
circumstances, the purchase of fishing vessels.  Since 1991, the programme has been barred by 
NOAA policy and Congressional directives from financing any project that could be construed to lead 
                                                     
 
10 Because no "buy back" programmes  were executed in fiscal year 2002, this notifi cation does not 
include a section on US buy back programmes.  However, as indicated below, and as indicated in the 
US notification submitted in June 2002, loans provided  under earlier buy back programmes are still outstanding.  
Additionally, for transparency purposes, under the Fishery Financing Program, we have provided information 
regarding certain buy back programmes which have been authorized for fiscal year 2003.    G/SCM/N/123/USA 
 Page 29 
 
 
  to overcapitalization of any fishery.  In 1994, the programme's regulations we re amended to reflect 
this change in policy.     In 1996, the FOG Program began providing direct  loans, and the name of the programme was 
changed to the Fisheries Finance Program.  At this time, FFP lending authority was extended to 
include aquaculture, vessel buybacks, Individual  Fishing Quota (IFQ) purchases (limited to the 
Halibut and Sablefish fishery) and Community Development Quota loans.    
Background and authority
 
 
 Background is provided above.  The statutory authority for the FOG Program and FFP is the 
Merchant Marine Act of 1936, as amended.  This programme is administered by the National Marine 
Fisheries Service (NMFS).    
Form
 
 
 The FFP programme provides direct loans to the fishing industry.  The interest rates charged 
on FFP loans are 2 percentage points above comparable  maturity Treasury bond yields as of the date 
of the loan closing.    
To whom and how assistance is provided
 
 
 Under the FFP, loans are provided directly to fishermen to finance any of the activities listed 
above.    
Amount
 
 
 In light of the many loans currently outstanding, and variations in amortization schedules and interest rates, the calculation of any subsidy amount , and especially the subsidy per unit, is not readily 
attainable.  Below is a tabl e showing the total amount of loans  that have been authorized since 1998.  
(If this programme provided a subsidy, the benef it would be based on the difference between the 
interest rate charged under the programme and th e amount the firm would pay on a comparable 
commercial loan.)  
 
TYPE OF LOAN FY'98 FY'99 FY'00 FY'01 FY'02  FY'03 FY 04
Traditional $24 $24 $24 $19 $19  $59 $59 
Halibut/Sablefish IFQ $0 $5 $5 $5 $5  $5 $5 
Community Development Quota $0 $25 $0 $0 $0  $0 $0 
NE Multispecies  $0 $0 $0 $10 $0  $0 $0 
Pollock Buyback $0 $75 $0 $0 $0  $0 $0 
Crab Buyback $0 $0 $0 $0 $0  $100 $0 
Pacific Groundfish  Buyback $0 $0 $0 $0 $0  $36 $0 
NE Multispecies  Buyback $0 $0 $0 $0 $0  $45 $0 
 
 
 It is important to note, that due to the rela tively high interest rates charged on these loans and 
the relatively low default rate, FFP is a self-financi ng programme.  In other words, the programme 
historically has not resulted in a net outflow of government funds.    
Duration
 
 
 Indefinite.   G/SCM/N/123/USA 
Page 30  
 
  Trade effects
 
  Since 1991 , the FFP has been barred by NOAA policy and Congressional directives from 
financing any project that could be  construed to lead to overcapitalization of any fishery.  Because of 
this policy, and because any subsidy element that might  be attributable to this programme is small or 
nonexistent, the trade effects from this programme are likely to be minimal, if any.   
  
Title: Saltonstall-Kennedy Grant Program:   Fisheries Research and Development 
 
Period covered by the notification
 
  The period covered is fiscal year 2003 and 2004.    
Policy objective and/or purpose
  
 
 This programme uses funds derived from duti es collected on fishery imports to fund a wide 
range of research and development grants that mo stly support effective conservation and management 
of US fisheries and fisheries communities by increasing the biological, economic, and social information needed for sound management.    
Background and authority
  
  The legislative authority for this progra mme goes back to the Saltonstall-Kennedy Act 
of 1954.  However, the current grant programme  was established by the American Fisheries 
Promotion Act of 1980, which amended the Salt onstall-Kennedy Act (15 U.S.C. 713c-3(c)).  The 
National Marine Fisheries Service administers the programme.   
 
Form
 
  Grants are awarded annually on a competitive basis.    
To whom and how assistance is provided
 
  This programme is open to: citizens or nationals  of the US;  citizens of the Northern Mariana 
Islands (NMI), Republic of the Marshall Islands, Republic of Pala u, or the Federated States of 
Micronesia, corporations, partnerships, associa tions, or other non-Federal entities, non-profit or 
otherwise (including Native American tribes) within the meaning of section 2 of the Shipping Act 
of 1916, as amended.  Federal employees and Fish ery Management Councils and their employees are 
ineligible.  Projects are selected  for funding through a competition/call for proposals announced in the 
Federal Register .   
 
Amount
 
 
 It is difficult to estimate a subsidy per un it for a diverse R&D grant programme.  In the 
years 2003 and 2004 there were no competitive grants  as in years past.  However, in 2003 and 2004, 
$2.8 million and $250,000, respectively, was distribut ed through the national programme to the states 
for research, seafood safety, marketing, etc.   
 
Duration  
  Indefinite.     G/SCM/N/123/USA 
 Page 31 
 
 
  Trade effects  
  The trade effects if any, of this programme are negligible, due to the programme's emphasis 
on product quality/safety and promotion of progress towa rd sustainable fisheries.  Moreover, much of 
the results of research conducted with Saltonsta ll-Kennedy funds are in the public domain.  
 
 
Title:   Sea Grant 
 
Period covered by the notification
 
 
 The period covered by this notification is fiscal year 2003 and 2004.    
Policy objective and/or purpose
 
 
 The Sea Grant programme provides grants to selected universities to car ry out research that 
addresses many aspects of the long-term economic development, environmental stewardship, and 
responsible use of marine and inla nd resources, including fish and shellfish.  A majority of these 
grants are intended to support effective conservation and management of US fisheries, rather than to 
assist commercial activities.  However, a small number of Sea Grant projects benefit industry, and, for that reason, in the interests of transparency, this programme has been included in this notification.   
 
Background and authority
  
  In 1965, Sea Grant Colleges were first iden tified through an amendment to the National 
Science Foundation Act of 1950, a nd, in 1966, the programme was formally established with passage 
of the National Sea Grant College and Program Act.  More than 200 individual colleges and 
universities in thirty state Sea Grant programs currently participate in this programme.   
 
Form
 
  Direct federal grants are normally paid to an  academic institution or other organization.   
 
To whom and how the assistance is provided
 
  The grant is provided to any individual;  any public or private corporation, partnership, or 
other association or entity (including any sea grant coll ege, sea grant institute or other institutions);  or 
any state political subdivision, or agency or officer thereof.  Each Sea Grant institution administers a 
"request for proposal" (RFP) process to address local and state concerns.  The National Marine Fisheries Service headquarters administers a separat e RFP process to elicit proposals with a national 
scope.    
Amount
 
 
 The large majority of grants under this programme support research that do not directly provide economic benefits to the fishing industry.  Therefore, it is difficult to determine the value of 
any subsidy that may be provided under this progr amme.  Total programme expenditures (fisheries 
and non-fisheries) were $106.4 million for fiscal y ear 2003.  (This total represents both federal 
government funds – approximately 66 per cent – and matching funds from state partners – 
approximately 34 per cent).  Of this amount, appr oximately $2.0 million were commercial fisheries 
expenditures.  Federal government funds  in 2004 totalled $61.968 million.   
 G/SCM/N/123/USA 
Page 32  
 
  Duration
 
  Federal grants for research and developm ent under the Sea Grant program are provided 
annually, although some of the projects are multi-a nnual.  The duration of the programme itself is 
indefinite.   
 
Trade effects
 
  The Sea Grant Program is not an industry or  trade promotion programme.  Very little of the 
funds provided directly impact the US fishing industr y.  Additionally, much of the results of research 
conducted with Sea Grant funds is in the public doma in.  In light of these considerations, the trade 
effects of this programme, if any, are likely to be minimal.    
 
Title: Columbia River Hatcheries   
 
Period covered by the notification
 
  The period covered is fiscal year 2003 and 2004.    
Policy objective and/or purpose
  
 
 The Mitchell Act (16 USC 755-757; 52 Stat. 345) authorizes the Secretary of Commerce to carry on activities for the conservation of fishery resources in the Columbia River Basin.  The 
Mitchell Act specifically directs establishment of salmon hatcheries, the c onduct of engineering and 
biological surveys and experiments, and the installati on of fish protective devices.  It also authorizes 
agreements with state fishery agencies and constr uction of facilities on state-owned lands.  The major 
objective of this programme has traditionally been  to mitigate the negative effects of lost salmon 
habitat caused primarily by the building of dams fo r hydroelectric power, and also by other factors, 
such as agricultural runoffs, logging, and urban devel opment.  Over the years, Mitchell Act hatchery 
production has changed to meet two other objectives.  First, some hatchery production has shifted to 
areas above the Bonneville Dam in order to provi de harvestable salmon under the Columbia River 
Treaty Indian Trust.  Second, a portion of the ha tchery production is being shifted to fulfil a 
conservation role in preserving endangered salmon stocks (captive breed) and supplementing their 
recovery.  With the application of the Endangere d Species Act throughout the Columbia River Basin, 
substantial changes have been, a nd will continue to be, required of the Mitchell Act Program.   
 
Background and authority
 
  The Mitchell Act salmon hatcheries progr amme has received federal appropriations 
since 1950, and is funded by general appropriations legislation.    
Form
 
 
 The US Government provides operating grants  to Columbia River Fisheries Development 
Program salmon hatcheries run by the Oregon Depart ment of Fish and Wildlife, the Washington 
Department of Fish and Wildlife, the Confederat ed Tribes and Bands of the Yakama Nation and the 
US Fish and Wildlife Service, Department of Interior.   
 
To whom and how assistance is provided  
  The funds are provided to the Oregon Depart ment of Fish and Wildlife, the Washington 
Department of Fish and Wildlife, and the Confed erated Tribes and Bands of the Yakama Nation  G/SCM/N/123/USA 
 Page 33 
 
 
  through Cooperative Agreements.  Funds are also  provided to the US Fish and Wildlife Service 
through an intergovernmental transfer.    
Amount
 
 
 In fiscal year 2003, the appropriation unde r the Mitchell Act Program was $16.42 million, 
including about $11.38 million to fund the operations  and maintenance of the hatchery programme in 
Oregon and Washington.  In fiscal year 2004, the appropriation was $1 5.78 million, including 
$10.94 million to fund the operations and maintenance of the programme.   
 
Duration  
  Indefinite.    
Trade effects
 
 
 The basic purpose of salmon hatcheries is to mitigate habitat and other losses associated with 
other federally-supported activities, and to restore depleted salmon resources, especially certain runs 
of chinook and coho salmon.  It is not possible to determine precisely the contribution of Columbia 
hatchery-reared fish to the commercial harvests in either waters off Washington, Oregon, and 
California or off Alaska, but it is generally accepte d that they have no discernible trade effect.   
  
LUMBER & TIMBER 
 Title: Capital Gains Treatment of Certain Timber Income 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To encourage domestic timber production.    
Background and authority
 
 
 The capital gains tax treatment is authorized  under sections 1231 and 631 of the Internal 
Revenue Code.  The provision was originally enacted in 1943.    
Form
 
  Income  tax concession.   
 
To whom and how assistance is provided
 
  Certain timber sold under a royalty contract  can be treated as capital gains for income tax 
purposes.  Income tax rates for individuals on ordi nary income ranged from 10 per cent to 35 per cent 
in 2003 and 2004.  For individual taxpayers, long- term capital gains are taxed separately from other 
income, generally at 5 per cent and 15 per cent rates.    G/SCM/N/123/USA 
Page 34  
 
  Amount
 
  The revenue loss was $100 million in  2003 and $70 million in 2004.   
 
Duration
 
 
 Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     
Title: Expensing of Multi-period Timber Growing Costs 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 The original ability to expense indirect costs of timber growing was apparently part of a general perception that these costs were maintenance co sts, and thus deductible as ordinary costs of a 
trade or business.  Following a series of revenue ru lings and court cases over the years distinguishing 
between what expenses might be deductible and wh at expenses might be capitalized, the Tax Reform 
Act of 1986 included uniform capitalization rules whic h required indirect expenses to be capitalized 
in most cases.  Where the application of these rule s was deemed to be unduly burdensome, exceptions 
were provided.    
Background and authority
 
 
 Generally, costs must be capitalized when goods  are produced for inventory used in one's own 
trade or business, or under contract to another part y.  Timber production, however, was specifically 
exempted from these multi-period cost rules and permitte d to subject such costs to current expensing.  
This expensing is authorized by sections 162 an d 263A(c)(5) of the Internal Revenue Code.   
 
Form  
  Income tax concession.    
To whom and how assistance is provided
 
 
 Timber owners can expense, rather than capita lize, certain deductions from taxable income.   
 
Amount  
  The revenue loss was $340 million per year in 2003 and 2004.   
 
Duration
 
  Indefinite.     G/SCM/N/123/USA 
 Page 35 
 
 
  Trade effects  
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.    
 
Title: Investment Credit and Seven-Year Amortization for Reforestation Expenditures 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose  
  To promote reforestation on private timberlands.   
 
Background and authority
 
  A special 10 per cent investment tax credit is allowed for up to $10,000 invested annually in clearing land and planting trees for the ultimate production of timber.  The same amount of forestation investment may also be amortized over a seven-y ear period.  Without this preference, the amount 
would have to be capitalized and could be recovered (d educted) only when the trees were sold or 
harvested years later.  Moreover, the amount of for estation investment that is amortizable is reduced 
by one-half of the investment credit that is allowe d.  These provisions are authorized by sections 48(b) 
and 194 of the Internal Revenue Code.  They were  originally enacted in the Recreational Boating 
Safety and Facilities Improvement Act of 1980.  
 
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
 
 Applies to taxpayers on the reforestation cost s incurred during the year as allowances against 
federal income taxes.    
Amount
 
 
 The revenue loss was less than $10 m illion per year in 2003 and 2004.   
 
Duration  
  Indefinite.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
 G/SCM/N/123/USA 
Page 36  
 
  MEDICAL 
 Title: Orphan Drug Tax Credit  
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To encourage research on drugs for rare diseases or conditions.   
 
Background and authority  
  The provision provides a 50 per cent tax credit for qualified clinical testing expenses incurred 
in testing of certain drugs for rare diseases or conditions, referred to as "orphan drugs".  Qualified 
testing expenses are costs incurred to test an or phan drug after the drug has been approved for human 
testing by the Food and Drug Administration (FDA), but before the FDA approves it for sale.  A rare disease or condition is one that affects less than 200,000 persons in the United States, or affects more than 200,000 persons, but for which there is no r easonable expectation that businesses could recoup 
the costs of developing a drug for such disease or condition from US sales of the drug.  The credit 
originally was enacted as a temporary provision in 1983 under the Orphan Drug Act, and was 
extended on several occasions.  The credit expired after 31 December 1994, and later was reinstated 
for the period 1 July 1996, through 31 May 1997.  The Taxpayer Relief Act of 1997 made the credit permanent.  The orphan drug credit is authorized under section 45C of the Internal Revenue Code.   
 
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
 
 Taxpayers undertaking qualified research on orphan drugs receive a credit against federal 
income tax.    
Amount
 
 
 The revenue loss was $160 million in 2003 and $180 million in 2004.   
 
Duration  
  Indefinite.    
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.      G/SCM/N/123/USA 
 Page 37 
 
 
  Title: The Office of Isotopes for Medicine and Science 
 
Period covered by the notification  
  This notification covers fi scal years 2003 and 2004.   
 
Policy Objective and/or Purpose
 
  The mission of the isotope programme is to main tain the infrastructure required to support the 
national need for a reliable supply of isotope pr oducts, services, and related technology used in 
medicine, homeland security applications, and scientific research.   
 
Background and authority
 
  The DOE Office of Nuclear Energy, Science, and Technology, Isotope Programs, administers 
the programme.  The programme operates under a revolving fund established by the 1990 Energy and 
Water Appropriations Act (Public Law 101-101), as modi fied by Public Law 103-316.  All income is 
deposited into the fund including the annual En ergy and Water Development Appropriations.   
 
Form
 
 
 No direct financial assistance is provided.  DOE sells commercial isotopes at full-cost 
recovery, which includes direct costs related to  the production of a specific isotope, as well as 
infrastructure costs.  Research is otopes are sold on a direct cost  recovery basis, which does not 
include a share of the hot cell infrastructure expense.    
To whom and how assistance is provided
 
  Isotopes are sold to a variety of commercia l and research institutions in the medical, 
industrial, and research communities -- commercial and non-commercial -- both in the United States 
and abroad.    
Amount
 
  Production expenses associated with the manufacture, processing, and distribution of isotopes are offset by revenue generated from sales.  Infrast ructure costs are covered in part by an annual 
Congressional appropriation.  For fiscal year 2003, the appropriated amount was $13.5 million, and in 
fiscal year 2004, the amount was $15 million.   
 
Duration
 
  The activity is of indefinite duration; th e programme operates with a revolving fund and 
maintains financial viability through its revenues from sales.   
 
Trade effects
 
 
Even if it were possible to quantify trade effe cts that might ensue from a programme of this 
nature, it is doubtful that this particular programme  has led to any meaningful trade effects.  The 
isotopes made available have been sold througho ut the world to over 250 customers, primarily for 
medical research.   G/SCM/N/123/USA 
Page 38  
 
  METALS, MINERALS AND EXTRACTION (NON-FUEL) 
 Title: Excess of Percentage over Cost Depletion for Non-fuel Minerals 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004  
Policy objective and/or purpose
 
 
 To encourage the development of th e domestic non-fuel mineral industry. 
 
Background and authority  
  The provisions permit most non-fuel mineral extr actors to make use of percentage depletion 
rather than cost depletion, with percentage de pletion rates ranging from 22 per cent for sulphur to 
5 per cent for sand and gravel.  Percentage depletion is authorized by sections 611-613 and 291 of the 
Code.  Percentage depletion simila r to its current form was provided in 1932 at 23 per cent for sulphur 
and 15 per cent for metal mines.  From 1932 to 1950,  percentage depletion was extended to most 
other minerals.  The Revenue Act of  1951 granted it to more minerals .  In 1954, still more minerals 
were granted the allowance.  In 1969, the top de pletion rates were reduced.  The Tax Equity and 
Fiscal Responsibility Act of 1982 reduced the allowa nce for corporations that mined iron ore by 
15 per cent.  The Tax Reform Act of 1986 raised th e cutback in corporate allowances of iron ore from 
15 to 20 per cent.    
Form
 
 
 Income tax concession.    
To whom and how assistance is provided
 
  Non-fuel mineral extractors  are permitted deductions from taxable income for depletable 
expenditures equal to the larger of percentage or cost depletion.   
 
Amount
 
  The revenue loss was $250 million in 2003 and less than $5 million in 2004.   
 
 Duration
 
  Indefinite.   
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of these 
provisions.     Title: Expensing of Exploration and De velopment Costs for Non-fuel Minerals 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    G/SCM/N/123/USA 
 Page 39 
 
 
  Policy objective and/or purpose  
  To encourage the development of domestic non-fuel mineral industry.    
Background and authority
 
 
 These provisions permit certain capital outlays associated with exploration and development of non-fuel minerals to be expensed rather th an depreciated over the life of the asset.  These 
provisions are authorized by sections 263, 263A, 29 1, 616-617, 56 and 1254 of the Internal Revenue 
Code.  Expensing of mine devel opment expenditures was enacted in 1951 to reduce ambiguity in the 
then-existing treatment of, and to encourage, mini ng.  The provision for mine exploration was added 
in 1966.  The Tax Equity and Fiscal Responsibility Act of 1982 limited expensing for corporations 
to 85 per cent; the remaining 15 per cent must be depreciated.    
Form
 
 
 Income tax concession.    
To whom and how assistance is provided
 
  Non-fuel mineral producers and royalty owne rs are permitted expensing of certain capital 
outlays associated with the development of non-fuel minerals rather than amortization over the life of 
the mine for federal income tax purposes.    
Amount
 
 
 The revenue loss was $10 million in 2003 and $230 million in 2004.   
 
Duration  
  Indefinite.   
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of these 
provisions.    
 
Title : Capital Gains Treatment of Iron Ore 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.   
 
Policy objective and/or purpose
 
  To encourage the mining of domestic iron ore.    G/SCM/N/123/USA 
Page 40  
 
  Background and authority
 
  The capital gains tax treatment is authorized  under sections 1231 and 63 1 of the Code.  As 
with coal, percentage depletion is not allowed when  the capital gains tax rate is below the regular tax 
rate.   
 
Form
 
  Income tax concession.    
To whom and how assistance is provided
 
  Certain iron ore and timber sold under a royalty contract may be treated as capital gains for 
income tax purposes.  Income tax rates for individua ls on ordinary income ranged from 10 per cent to 
35 per cent in 2003 and 2004.  For individual taxpaye rs, long-term capital gains are taxed separately 
from other income, generally at 5 per cent and 15 per cent rates.   
 
Amount
 
  The revenue loss was less than $5 million per year in 2003 and 2004.    
Duration
 
  Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     
Title: Special Rules for Mining Reclamation Reserves 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
  In allowing the current deduction of mine reclamation and similar expenses, the provisions encourage reclamation and prevent adverse economic  effects on mining firms that might result from 
the application of general tax rules re garding deduction for future costs.   
 
Background and authority
 
  The provisions permit taxpayers to establis h reserves to cover certain costs of mine 
reclamation and of closing solid waste disposal properties.  Net increases in reserves may be taken as a deduction against taxable income.  The provisions are authorized by section 468 of the Internal 
Revenue Code and were enacted in 1984.   
 
Form
 
  Income tax concession.    G/SCM/N/123/USA 
 Page 41 
 
 
  To whom and how assistance is provided  
  Taxpayers with mining and solid waste dispo sal properties receive deductions from taxable 
income based on the accrual of liabilities rath er than the realization of costs.   
 
Amount
 
  The revenue loss was less than $5 million per year in 2003 and 2004.    
Duration
 
 
 Indefinite.    
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.     
Title: Emergency Steel Loan Guarantee Program 
 
Period covered by the notification
 
  This period covered is fi scal years 2003 and 2004.  
 
Policy objective and/or purpose
 
 
The overall purpose of this programme was to assist steel companies injured by the import 
crisis in 1998 - 2002.    
Background and authority
  
 
The Emergency Steel Loan Guarantee Act of 1999  was signed into law on 17 August 1999.  
The Guarantee Board, consisting of  representatives of the Federal Reserve System, the Securities and 
Exchange Commission, and the Department of Co mmerce, administer the programme and had the 
authority to guarantee loans until 31 December 2005.    
Form
 
 
The programme guaranteed loans up to 95 per cen t of the principal amount of loans provided 
by private lenders.    
To whom and how assistance is provided
 
 
The programme guaranteed loans provided to qualified steel companies by private banking 
and investment institutions in accordance with rul es established by the Guarantee Board.  The Board 
had the authority to make commitments for guarantees of loans up to $1 billion.  The amount guaranteed to any single qualified steel company could not exceed $250 million.   
 G/SCM/N/123/USA 
Page 42  
 
  Amount
 
  The Board received an application for guarantee of a $250 million loan in September 2002 that was approved for guarantee in March 2003.  Th e guaranteed loan was issued in August 2003.  
This was the third and final loan guarantee issued under the programme.   
 
Duration
 
 
The Board's authority to issue guarantees expire d 31 December 2005.  Currently there are no 
applications pending under this programme.   
 
Trade Effects  
 
It is not possible to estimate what trade effect s, if any, may result from this programme.   
 
 
TEXTILES 
 
Title: The Textile/Clothing Technology Corporation Program (TC2)  
 
Period covered by the notification  
 
 The period covered is fiscal years 2003 and 2004.   
Policy objective and/or purpose
 
 
 The Textile/Clothing Technology Corporati on is a non-profit membership organization 
designed to stimulate economic growth in the US te xtile and apparel sector.  It has programmes to 
demonstrate advanced equipment and techniques, to e ducate participants in the sector, and to do basic 
research.  Only the basic research element is f unded by the federal government through a grant from 
the US Department of Commerce (DOC).  The b asic research is performed internally by the 
organization and, in part, by external entities on a cont ractual basis.  The results  of the basic research 
are made available throughout the textile and a pparel sector of the United States.  No production 
subsidies are provided under this programme.    
Background and authority
 
 
 The programme is administered by DOC's Offi ce of Textiles and Apparel.  Authorization and 
funding for the programme is provided for as part of the annual budget and appropriations process for 
the DOC.    
Form
 
 
 Assistance is provided under this programme in the form of grants.   
 
To whom and how assistance is provided  
  A grant is provided to the Textile/Clo thing Technology Corporation following the 
presentation of a proposal describing the rese arch projects which will be undertaken.   
  G/SCM/N/123/USA 
 Page 43 
 
 
  Amount  
  Appropriations (approximate dollars in millions).   
  2003 - $2.9   2004 -$2.8 
 
Duration
 
  Grants were first distributed under the progra mme in 1981.  Funding must be reauthorized by 
the US Congress on an annual basis. 
 
Trade effects
 
  In light of the scope and nature of the R& D activities being assisted, it is not possible to 
determine what, if any, trade effects may ever result from this programme.  While it is anticipated that 
successful research projects may lead to the de velopment of technologies that would enable 
companies in the textile and apparel sector to improve their productivity, TC2 assistance does not 
directly benefit the production or export of particular companies or products.   
  
TIMEPIECES AND JEWELLERY 
 Title: The Insular Possessions Watch and Jewellery Programs .   
 
Period covered by the notification
 
 
The period covered is calendar year 2003 and 2004.   
 
Policy objective and/or purpose  
 
The insular watch and jewellery programmes ar e designed to encourage watch and jewellery 
production in the US insular possessions and thereby st imulate development of the insular economies.   
 
Background and authority  
 
The US Department of Commerce and the US Depa rtment of the Interior jointly administer 
the Insular Possessions watch programme under Pub lic Law 97-446, as amende d by Public Law 103-
465 and Public Law 108-429.  The watch programme provides for duty exemptions and duty refunds 
in the form of negotiable production incentive certificates.    
Public Law 106-36 and Public Law 108-29 amended additional US  notes to chapter 71 of the 
Harmonized Tariff Schedule of the United States ("HTS") to provide a duty-refund benefit for any article of jewellery within heading 7113 that is a product of the US Virgin Islands, American Samoa, 
Guam and the Northern Mariana Islands in acco rdance with the new provisions of the note in 
chapter 71 and additional US Note 5 to chapter 91.  The jewellery programme is also administered by 
the US Department of Commerce and the US Depart ment of the Interior.  The jewellery programme, 
like the watch programme, provides for duty refund s in the form of negotiable production incentive 
certificates, but does not provide for duty exemptions.   
 G/SCM/N/123/USA 
Page 44  
 
  To whom and how assistance is provided
 
 
The assistance is provided to watch and jewellery  producers located in the US Virgin Islands, 
American Samoa, Guam and the Northern Mariana Islands.  At present, there are producers only in 
the US Virgin Islands.   
 
The watch programme establishes an annual allocation for watches and watch movements 
assembled in these areas to enter the United States  free of duty.  Both the watch and jewellery 
programmes provide production incentive certificates  which authorize a duty refund from Customs on 
(HTS non-column 2) articles that have entered the United States duty-paid.  The subsidy amount is 
based on the duty foregone on the fi nished watches and watch movements, as well as the value of the 
production certificates issued to watch and jewelle ry companies.  Since the watches, the watch 
movements and jewellery produced under the prog rammes already receive duty-free treatment, the 
certificate is negotiable and may be transferred to  another company having a record of duty-paid 
imports.  The value of the certificate is based on the producer's average creditable wages per unit 
shipped free of duty into the United States mu ltiplied by a factor of 90 per cent for the 
first 300,000 units and by declining percentag es in additional increments up to a maximum 
of 750,000 units for watches and watch moveme nts and 10,000,000 units for jewellery.   
 
Amount  
 Production Incentive Certificate ("PIC")  Year (1)  Product  Total Amount (2) 
 
2003 Watches  $2,304,244 
 
2003 Jewellery  $1,704,827  2004 Watches  $1,837,761  2004 Jewellery  $2,036,949        
 
 
(1) The PIC is based on the wages and shipme nts made during the above mentioned calendar 
year.  Due to the passage of Public Law 108-429 in  December 2004, there will be further production 
incentive certificate amounts issued for years 2003 and 2004 after the final regulations are in place.  
The amounts will increase because the law was retroac tive to January 2003 and contained a provision 
which allows for general fringe be nefits to be included in the wages as part of the production 
incentive certificate.  It is not anticipated that th ere will be major changes in the above figures but 
there will be increases in these amounts.     
(2) One per cent is deducted from the total am ount of the duty refund shown above to cover 
the administrative costs of processing by Customs.   
 
Duty Exemption    Amount (3) 
 
2003     $270,816  
2004   $305,379   G/SCM/N/123/USA 
 Page 45 
 
 
  (3) The amount of the duty paid was calculated by using an approximate total trade 
ad valorem equivalent rate of 6 per cent multiplied by the total yearly amount of the invoices billed to 
customers.    
Duration
 
 
The watch programme annual allocation for watches and watch movements assembled in 
these areas to enter the United States free of duty is authorized through 2015 as is the production 
incentive duty refund certificate for watch a nd jewellery programme participants.   
 
Trade Effects  
 
Although the precise trade effects cannot be de termined, the support from these programmes 
account for approximately 0.007 per cent of US an nual personal domestic c onsumption of watches 
and jewellery.  Also, the watches and jewellery cove red by the programme are only shipped to the US 
market. 
  
OTHER 
 Title:   Advanced Technology Program 
 
Period Covered by the Notification
 
 
The period covered is fiscal years 2003 and 2004.   
 
 Policy objective and/or purpose  
 
The Advanced Technology Program (ATP) of th e US Department of Commerce's National 
Institute of Standards and Technology is a partne rship between government and private industry to 
accelerate the development of high-risk technologies that promise significant commercial payoffs and widespread rewards for the US economy.  In sh aring the relatively high development risks of 
technologies that potentially enable a broad range  of new commercial opportunities, possibly across 
several industries, ATP fosters projects with a high payoff for the US economy as a whole.  The nature of ATP projects, risky but broadly applicable, stimulates joint research ventures that link small 
suppliers with users or link several firms together  to solve a generic problem common to all.  The 
ATP holds competitions open to proposals in all areas of technology, and has provided cost-shared 
financial assistance for the development of a wide span of advanced technologies.   
 
Because there are no de jure  limitations on who may participat e in ATP as a whole, and given 
the wide variety of technologies and industrial sect ors that have participated, the United States has 
routinely considered that there is no readily availa ble evidence to suggest that this programme should 
fall within the scope of our notification.  However, recognizing that this is an exercise in transparency, 
we have provided available info rmation about the programme.   
 
Background and authority
 
 
The programme is operated by the National Ins titute of Standards a nd Technology under the 
auspices of the Technology Administration of the US Department of Commerce.   
 G/SCM/N/123/USA 
Page 46  
 
  Form
 
 
The ATP does not fund product development.  It supports enabling technologies that are 
essential to the development of new products, processes,  and services across diverse application areas.  
Private industry bears the costs of product development, production, marketing, sales, and 
distribution.  Moreover, ATP awards are made strictly on the basis of rigorous peer-reviewed 
competitions designed to select the proposals that are best qualified in terms of the technological ideas, the potential economic benefits to the nation (not  just the applicant), and the strength of the plan 
for eventual commercialization of the results.  Expe rt reviewers (without conflicts of interest) drawn 
from the business community, government, and academia  carefully examine and rate each proposal 
according to published selection criteria that focu s on both business and technical potential.   
 
ATP projects are expected to make significan t contributions to scientific and technical 
knowledge, produce new technologies that will be de veloped and introduced into the marketplace by 
the project awardees (using their own funds), and, in  the long run, yield substantial benefits to the 
economy beyond those accruing directly to the award recipients.  This is a lengthy process.  
ATP projects typically run from 2 to 5 years, the commercialization phase could add several more years, and the full economic impact may not be rea lized for some years after commercial introduction.  
It also is costly, because compan ies must spend additional time, effort, and money on their own to 
pursue product development and marketing.  Rega rdless of whether initial commercialization takes 
place before an ATP project ends, or long after, the company must invest its own money to design 
specific products incorporating the technology and to pay any other costs associated with 
commercialization.    
To whom and how assistance is provided
 
 
The ATP has strict cost-sharing rules.  Joint ventures must pay at least half of the project 
costs. Single companies working on ATP projects mu st pay all indirect costs associated with the 
project, or, if they are large companies, they must co st share at least 60 per cent of total project costs.  
(This provision encourages small companies to participate in the programme, particularly start-ups, which often have much lower overhead rates than  large firms).  ATP support does not become a 
perpetual subsidy or entitlement Ceach project has goals, specific funding allocations, and completion 
dates established at the outset.  Projects are monitored and can be terminated for cause before 
completion.   
 
The ATP benefits companies of all sizes.  To date, over 66 per cent of 768 ATP awards have 
gone to individual small businesses (fewer than 500 employees) or to joint ventures led by a small 
business, a large majority of which have fewer than 49 employees.  In fiscal year 2004, 59 awards were made, of which 80 per cent were to small firms.   In fiscal year 2003, 67 awards were made, of 
which 82 per cent were to small firms.  Large fi rms can work with the ATP, especially in joint 
ventures, to develop critical, high-risk technologies that would be difficult for any one company to justify, because, for example, the benefits are spr ead across the industry as a whole.  Universities and 
non-profit independent research organizations also pl ay significant roles as participants in ATP 
projects.  To date, 172 different universities across 47  states are involved in ATP-funded projects.  In 
fiscal year 2004, 29 universities across 26 states were involved in newly awarded projects.  In fiscal 
year 2003, 34 universities across 29 states were involved in newly awarded projects.    
Amount
 
 
2003 - $180.0 million 
 2004 - $179.2 million 
  G/SCM/N/123/USA 
 Page 47 
 
 
  Duration  
 
On-going.   
  Trade Effects
 
 
 The trade effects, if any, cannot be determined.   
 
 Title: Empowerment Zones, Enterprise  Communities and Renewal Communities 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
  The purpose of this assistance is to encourage re vitalization of distressed areas.  Nominated 
areas must meet population, distress, size, and poverty rate criteria in order to be eligible, ensuring 
that assistance is targeted to areas experiencing hi gh economic distress.  The use of tax incentives 
reflects a desire to encourage the private sector, guided by market forces and supported in a non-
bureaucratic fashion through government assistance,  to be a driving force behind the increased 
economic activity.  Some restrictions on the ty pes of business activities and investments were 
imposed in order to limit potential abuses.    
Background and authority
 
 
 The Omnibus Budget Reconciliation Act of 1993 provided for the designation of nine 
empowerment zones (3 rural and 6 urban) and 95 enterprise communities (30 rural and 65 urban).  
The Taxpayer Relief Act of 1997 added 22 empowe rment zones (5 rural and 17 urban), and the 
District of Columbia Enterprise Zone (DC Zone).   The Community Renewa l Tax Relief Act of 2000 
added 9 empowerment zones (2 rural and 7 urban)  and authorized the designation of 40 renewal 
communities (12 rural and 28 urban).  State and lo cal governments jointly nominated distressed areas 
and proposed strategic plans aimed at economic and social revitalization.  Rural enterprise 
communities and empowerment zones were designat ed by the Secretary of the Department of 
Agriculture, while urban enterprise communities,  urban empowerment zones and all renewal 
communities were designated by the Secretary of the Department of Housing and Urban 
Development.  The tax provisions for enterp rise communities, empowerment zones, renewal 
communities, and the DC Zone are found in secti ons 1391 through 1400J of the Internal Revenue 
Code.     Qualified businesses located in empowerment zon es are eligible for the following federal tax 
incentives:  (i) an employment tax credit for 20 per cent of the first $15,000 of qualifying wages paid 
to employees who live and work in the empowerment zone;  (ii) an additional $35,000 per year of 
expensing, instead of depreciation, of capital i nvestments by small businesses;  and (iii) a new 
category of tax-exempt private activity bonds.  In ad dition, taxpayers may elect to defer capital gains 
from certain sales and re-investments in qualified empowerment zone assets and the exclusion on the gain from the sale of qualified small business stock that is held for more than five years is increased 
from 50 to 60 per cent for empowerment zone bus inesses.  Businesses located in enterprise 
communities are only eligible for the new category of tax-exempt bonds.     Qualified businesses located in renewal communiti es are eligible for the following federal tax 
incentives:  (i) an employment tax credit for 15 per cent of the first $10,000 of qualifying wages paid G/SCM/N/123/USA 
Page 48  
 
  to employees who live and work in the renewal comm unity;  (ii) an additional $35,000 per year of 
expensing, instead of depreciation, of capital i nvestments by small businesses;  (iii) a commercial 
revitalization deduction;  and (iv) an exclusi on for capital gains on qualified community assets held 
more than 5 years.    
 Incentives for the DC Zone include the employ ment tax credit, increased expensing and tax 
exempt financing incentives available in empowerment  zones, plus an exclusion for capital gains on 
qualified assets held more than 5 years.    
Form
 
 
 Income tax concession.    
To whom and how assistance is provided
 
 
 The employment tax credit and an additional $35,000 per year of expensing are provided 
when the recipient business completes its tax return.  No registration is needed to qualify for the tax 
incentives.  The new category of tax-exempt privat e activity bonds requires a local initiation and State 
offering of the bonds.  The subsidy is reflected in th e lower interest rate charged on the bonds because 
interest income on them is excluded from federa l taxable income.  The capital gains incentives are 
provided to investors in qualified zone or community assets by reducing the amount of capital income 
subject to tax.   
  To qualify for the employment credit, substan tially all of the employee's services must be 
provided in the zone or community.  The $35,000 of additional expensing is ta rgeted to assist small 
businesses because the benefit of expe nsing begins to phase out when investment exceeds $200,000.  
To qualify for the expensing, businesses must also m eet other criteria, such as having at least 35 per 
cent of employees who reside in the zone or community.  Businesses lo cated in enterprise 
communities and empowerment zones are eligible fo r the new category of tax-exempt bonds.  Up 
to $3 million per business per zone in bond funding  and $20 million per business for all zones is 
available.  The exclusion of capital gains from qua lified DC Zone assets held more than 5 years does 
not apply to gains earned before 1998 or after 2010.  The exclusion of capital gains from qualified 
renewal community assets held more than 5 years does not apply to gains earned before 2002 or 
after 2014.    
Amount
 
 
 The revenue loss was $1,070 million in 2003 and $1,080 million in 2004.   
 
Duration  
  Tax incentives have been available since the first zones and communities were designated on 
21 December 1994.  Empowerment zone and renewal community tax benefits are due to expire on 
31 December 2009, with the exception of th e DC Zone tax benefits, which expire on 
31 December 2005.  Enterprise community tax benefits expired on 31 December 2004.   
 
Trade effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.      G/SCM/N/123/USA 
 Page 49 
 
 
  Title: The Export Credit Programs of the Export-Import Bank of the United States 
 
Period covered by the notification  
  The period covered is fiscal year 2003 and 2004.   
 
Policy objective and/or purpose;  background and authority
 
  The Export-Import Bank of the United States (Ex-Im Bank) is authorized by the Export-Import Bank Act of 1945 to pr ovide credits, guarantees and insura nce, including commercial and 
political risks, to support exports of US goods and servi ces.  The financial support is to be at rates and 
on terms that are competitive with government-s upported rates and terms available from other 
countries whose exporters compete with US e xports.  All Ex-Im Bank programmes are in full 
conformity with the OECD guidelines on export credit practices and, concomitantly, the Agreement on Subsidies and Countervailing Measures.  Inasmuch as other official authorities offer official 
financing in support of exports from their countries,  Ex-Im Bank has offered similar financing.   
 
Form;  amount
 
  The United States Federal Credit Reform Ac t of 1990 (Credit Reform) made fundamental 
changes in the budgetary treatment of direct loans,  loan guarantees and insurance.  Credit Reform, 
which became effective in fiscal year 1992, shifte d the accounting basis for federally provided or 
guaranteed credit from the amount of cash flowing into  or out of the Treasury for a credit programme, 
to the estimated net financial costs of the loans, guarantees and insurance.  Credit Reform requires an 
annual appropriation that is used to set aside a loan -loss reserve to cover any expected financial losses 
in recognition of the cost to the US government of running an official export credit programme.   
 
 Under the accounting procedures required by Credit Reform, the cost of Ex-Im Bank 
programmes is calculated as the difference betwee n the amount committed and the present value of 
the expected cash inflows, each di scounted by the interest rate on  marketable Treasury securities of 
like maturity.  This includes the cash  flows specified in the contract  financed by Ex-Im Bank, as well 
as "expected" deviations from contract terms, in cluding delinquencies, defaults, prepayments, and 
other factors.  This calculation is performed on a transaction-specific basis, and for those transactions 
showing a positive cash flow on a net present value b asis, the transaction cash flow is zero-ed out for 
Credit Reform purposes.     For direct loans, cash outflows include loan disbursements, and cash inflows include exposure 
fees and repayment of principal and interest net of expected defaults.  For loan guarantees and 
insurance, cash outflows include payments to cover default claims and intere st supplements, and cash 
inflows include fees and recoveries.  The expected  costs are calculated using a model developed by 
the Office of Management and Budget.     The following tables show the US government  budget authority value for Ex-Im Bank direct 
loan, loan guarantee and insuran ce programmes.  Due to the unique nature of US credit reform 
calculations, the numbers presented in the tables are not comparable with short-term cash-flow data 
presented by other government export credit agencies.    G/SCM/N/123/USA 
Page 50  
 
  Table I
 
 
Direct Loan Budget Authority 
($ Millions) 
 
Fiscal Year Direct Loan  
Levels Budget 
Authority % 
2001 871.2 93.8 10.8% 
2002 295.6 48.6 16.4% 
2003   58.3  0.9   1.5% 
2004 227.1 21.5   9.5% 
 
 
Table II  
 
Loan Guarantee and Insurance Budget Authority 
($ millions) 
 
Fiscal Year Guarantee & Insurance 
Levels Budget 
Authority % 
2001   9,370.3 729.7 7.8% 
2002   9,823.6 677.9 6.9% 
2003 10,448.9 329.3 3.2% 
2004 13,093.9 248.4 1.9% 
 
Duration  
 
 Ex-Im Bank activities are subject to periodic renewal under US law.  Congress reauthorized Ex-Im Bank until the end of September 2006.    
Trade Effects
 
 
 It is not possible to estimate what, if any,  trade effects may result from the use of this 
programme.    
 
Title: New Markets Tax Credit 
 
Period covered by the notification
 
  The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To encourage capital investment in businesses located in economically distressed areas.   
 
Background and authority  
 
 The Community Renewal Tax Relief Act of 200 0 created the new markets tax credit under 
section 45D of the Internal Revenue Code.     G/SCM/N/123/USA 
 Page 51 
 
 
  Form  
  Income tax concession.    
To whom and how assistance is provided
 
 
 A tax credit is applied to taxpayers who make an equity investment in a Community 
Development Entity (CDE).  The credit amount is equal to 5 per cent of the investment for each of the 
first three years and 6 per cent for each of the foll owing 4 years.  A CDE is any domestic firm whose 
primary mission is to serve or provide investment capital for low-income communities or individuals.  
A fixed amount of equity investment is eligible  each year for the credits, which is apportioned to 
CDEs through a competitive application process.  The total amount of equity investment eligible for 
the credit is $15 billion from 2001 to 2007.     Amount
 
 
 The revenue loss was $190 million in 2003 and $290 million in 2004.   
 
Duration  
  This credit first became effec tive in 2001, and credit allocations to qualified CDEs will be 
made through 2007.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
  
Title: New York Liberty Zone 
 
Period covered by the notification
 
 
 The period covered is fiscal years 2003 and 2004.    
Policy objective and/or purpose
 
 
 To encourage the redevelopment of the area surrounding the World Trade Center in New 
York City in the aftermath of the terrorist attack on 11 September 2001.    
Background and authority
 
  Section 1400L of the Internal Revenue Code, en acted as part of the Job Creation and Worker 
Assistance Act of 2002.   
 
Form
 
  Income tax concession.   
 
To whom and how assistance is provided
 
  The New York Liberty Zone is the area immedi ately surrounding the World Trade Center in 
New York City.  The following tax incentives are provided:  (i) qualified small businesses are allowed G/SCM/N/123/USA 
Page 52  
 
  a wage credit equal to 40 per cent of the fi rst $6,000 of qualifying wages paid annually to each 
qualifying employee;  (ii) an additional $35,000 per y ear of expensing, instead of depreciation, of 
capital investments by small businesses within the Z one;  (iii) 30 per cent expensing, instead of 
depreciation, of certain property placed in service within the Zone;  (iv) accelerated depreciation of 
qualified leasehold improvement property placed in service within the Zone;  (v) authorization for 
New York State and New York City to issue an ad ditional $8 billion in tax-exempt private activity 
bonds to finance property placed in service within the Zone;  (vi) an additional advance refunding of 
tax-exempt bonds up to an aggregate limit of $9 b illion for facilities located in  New York City;  and 
(vii) extension of the replacement period from 2 to 5 years for certain property involuntarily converted 
due to the 11 September 2001 terrorist attack.   
 
Amount
 
  The revenue loss was $790 million in 2003 and $630 million in 2004.   
 
Duration
 
  The wage credit expired at the end of 2003, th e additional authority to issue tax-exempt bonds 
and the bonus depreciation for structures expire at the end of 2009, the additional advance refunding 
of tax-exempt bonds expires at the end of 2005, and the other provisions expire at the end of 2006.   
 
Trade effects
 
  It is not possible to estimate what, if any,  trade effects may result from the use of this 
provision.   
  
   G/SCM/N/123/USA
 Page 53 
State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alabama Appalachian 
Regional Commission Grant Alabama 
Department of Economic and 
Community 
Affairs Grant The Appalachian Regional 
Commission (ARC) provides supplemental funding for economic 
development projects under its Area 
Economic and Human Resources Development Program.   Appalachian Regional Commission 
(ARC) region consisting of 37 counties in North Alabama in a line just north of 
Montgomery.  New or expanding 
businesses including manufacturing and warehousing.   $200,000 maximum or 50 per cent of total project 
cost spent on serving more than one industry.  Can bring federal participation up to 80 per cent of 
eligible project cost.   Ongoing 
Alabama Capital Investment 
Tax Credit Alabama 
Department of Revenue Tax Credit The programme allows qualifying 
companies to claim a tax credit against Alabama income tax 
liability generated by or arising out 
of a qualifying Alabama project.   Favoured Geographic Area:  defined as 
one of the 28 Alabama Enterprise Zones or either one of the less 
developed counties as determined by 
the Department of Industrial Relations based on statutory criteria.  Small 
Business Addition: addition to existing 
facility, company must have 100 or fewer employees in Alabama prior to the date addition is placed in service.   A capital credit is available to the income tax 
liability generated by income from a project approved by the Alabama Department of Revenue 
(ADOR).  The capital cred it is available each year, 
for 20 years.  The capital credit is calculated at five per cent of the total capita l costs of the qualifying 
project and the credit begins in the year the 
qualifying project is "placed in service". Ongoing 
Alabama Community 
Facility Loan and 
Grant Program USDA Rural 
Development Mixed 
Financing To promote development in rural 
communities.   Rural communities with a population 
of 20,000 or less.  Priority is given to 
applicants in rural communities with 
populations of 5,000 or less and areas with the lowest median household 
income.   Interest rates for direct loans are based on current 
market yields for municipal obligations.  The 
maximum term for all loans is 40 years.  However, 
the repayment period is lim ited to the useful life of 
the facility or equipment or any statutory limitation 
on the applicant's borrowing ability.   Ongoing 
Alabama Enterprise Zone 
Tax Credit Alabama 
Department of 
Revenue Tax Credit Enterprise Zone Act is a job 
creation programme.  It is a 
performance driven programme and 
provides credits for specific accomplishments of the company.   28 Designated enterprise zones.  
Economic development within 
depressed communities.  Enterprise 
zone residents especially those unemployed for at least 90 days prior 
to employment.   Maximum credit of $2500 per new permanent 
employee.  Credits are to be used in the year 
earned with any remainder available to be applied 
against income or business privilege tax liabilities for he succeeding two years.  There are three ways 
to make up the $2500 maximum credit for new 
permanent employee.  2) credit based on income tax liability from EX project operations:  5 year tax credit incentive, taken in  increments:  year 
1=80 per cent, year 2=60 per cent, year 3=40 per 
cent, year 4&5=20 per cent.  Must be certified annually by the Alabama Department of Economic 
and Community Affairs that requirements have 
been met. 2) Credit from new capital investment:  10 per cent of the first $10,000;  5 per cent of the 
next $90,000;  2 per cent of the remaining 
investment.  Minimum job creation of 5 new 
permanent employees.  3) Training: Company may 
claim a credit of up to $1000 for training new 
permanent employees in new skill areas.   Ongoing  
  G/SCM/N/123/USA 
Page 54 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alabama Intermediary 
Relending 
Program USDA Rural 
Development Loan A loan programme funded by the 
Rural Economic and Community 
Development (REDC) to strengthen 
the economy of rural communities.   Priority scoring is gi ven to applications 
located in areas of high unemployment, 
areas experiencing trauma, and areas 
where the population has declined.  All territory of a state that is not within the 
outer boundary of any city having a 
population of 25,000 or more, according to the latest decennial 
census. Loans to intermediaries are scheduled for 
repayment over a period of up to 30 years with an 
interest rate of one per cent per annum.  The 
intermediary sets the term of the loans and sets the interest rate that they will charge to ultimate 
recipients.  The maximum lo an to an intermediary 
is $750,000.00. Ongoing 
Alabama Property Tax 
Exemptions for 
Industrial Projects Alabama 
Department of 
Revenue Tax 
Abatement/
Reduction Both non-exempt real property and 
personal property are subject to ad 
valorem property taxation.  To encourage the development of new 
industry in the state as well as to 
encourage the expansion of existing industry, an abatement from 
property taxation is provided in 
some cases.  Certain industries may be exempted from the state, county, and city tax levies, except for taxes 
levied for education. Statutory Requirements:  1) The 
qualifying project must constitute an 
"industrial, warehousing, or research activity" defined as any trade or 
business described in the 1987 
Standard industrial Classification (SIC) code, promulgated by the US 
Government Office of Management 
and Budget as:  Major Groups 20-39, inclusive;  50 or 51;  Industrial Group Number 737;  or Industry Numbers 
0724, 4613, 8731, 8733, or 8734.  2) 
Expansion projects may qualify for an abatement under a "major addition" 
provided the project meets an 
additional investment threshold requirement of the lesser of 30 per cent 
of the original cost of the industrial 
development property, or $2 Million.   Industrial projects may be exempted from ad 
valorem (property) taxes for up to 10 years (except 
school taxes) with fi xed assessment ratio 
established at 20 per cent of appraised market 
value for businesses.   Ongoing 
Alabama Regional 
Revolving Loan Funds Alabama 
Association of Regional 
Councils Loan Revolving loan funds are locally 
controlled.  Capital may be used to finance start-up and existing 
businesses whose projects will 
create permanent jobs.   Financing for small manufactures, 
manufacturing related services located in the Southeast. Equity requirement that is established locally 
usually falls between 5 per cent and 25 per cent.  The interest rate is normally below prime and can 
be fixed or variable.  Programme requires 
conventional lender participation.   Ongoing  
   G/SCM/N/123/USA
 Page 55State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alabama Renewal 
Community (RC) 
Program Alabama 
Development 
Office Mixed Tax The RC Program is a federal tax 
incentive programme created to 
assist in the economic development 
and expansion of 40 communities throughout the United States.  In 
January 2002, three areas received 
federal designation as RCs in the State of Alabama.  Those 
designated include areas of nine 
counties in Southern Alabama, Greene and Sumter counties, and 
East Mobile and Prichard.   Must be located in RC as designated 
by the programme.  Generally, an RC 
business is defined as a corporation, 
partnership, or sole proprietorship that for each taxable year actively conducts 
every trade or busine ss of the entity in 
a RC;  at least 50 per cent of the total gross income of the entity is derived 
from the active conduct of business 
within a RC; a substantial portion of the use of the tangible property of the 
entity is within a RC;  a substantial 
portion of the intangible property of the business is used in the active 
conduct of the business;  a substantial 
portion of the services performed for the employer by its employees occur 
within a RC;  at least 35 per cent of the 
employees reside in a RC;  no more than 5 per cent of the property is 
nonqualified financial property except 
for reasonable amounts of working capital held in cash, cash equivalents, or debt instruments;  and no more than 
5 per cent of the property is works of 
art or other collectibles unless held for sale to customers.   Available incentives incl ude wage credits for 
employing RC residents;  increased Section 
179 deduction;  commercial revitalization 
deduction;  and zero capital gains rate for RC assets.   Ongoing 
Alabama Rural Business 
Enterprise Grants USDA Rural 
Development Grant A grant programme funded by 
Rural Economic and Community 
Development (REDC) to strengthen 
the economy.   Any area other than an incorporated 
city or town w ith greater than 
50,000 population and the urbanized 
area contiguous and adjacent to such city or town.   Must assist small and emerging private business 
(50 or less employees and less than $1,000,000 in 
projected gross income).   Ongoing 
Alabama Rural Business 
Opportunity Grant USDA Rural 
Development Grant To promote development in rural 
communities.   Any area other than an incorporated 
city or town w ith greater than 
10,000 population and the urbanized 
area contiguous and adjacent to such 
city or town.  Pr iority communities--
those experiencing trauma due to 
natural disasters or are undertaking 
fundamental structural changes, have remained persistently poor or have 
experienced long-term population 
decline or job deterioration. $50,000 limit on unearmarked funds per applicant 
per state.   Ongoing 
Alabama Venture Capital 
Funds Alabama 
Development Office Tax Credit House Bill 627 authorizes the 
establishment of CAPCOs certified capital companies to manage such 
funds.   Small technology businesses.   Credits are li mited to $12.5 million in any year.   Ongoing  
  G/SCM/N/123/USA 
Page 56 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alabama Tennessee Valley 
Authority 
Economic 
Development Loan Fund Tennessee 
Valley Authority Loan A multimillion dollar revolving 
loan programme established to 
stimulate industrial development 
and leverage capital investment in the TVA power service area.  An 
indirect financing loan programme 
promotes economic expansion, encourage job creation and foster 
the increased sale of electricity by 
TVA and its power distributors.   All industries.   Loans are typically below market rate, with 
specific rates to be determ ined on a case by case 
basis after considering the loan evaluation criteria 
(project's financial viability, management quality, community economic impact, funds leverage and 
increased power sales).  Maximum length of terms 
is 10 years for new plants, plant expansion and plant retention.  7 years for service industry loans 
and 6 years for infrastructure loans.  Repayment 
schedules will be determined on a project by project basis.  No TVA loan is likely to exceed 
$2 million.  Real estate and equipment can be used 
for collateral.   Ongoing 
Alabama Water and Waste 
Disposal Funds USDA Rural 
Development Loan Indirect financing for public bodies 
and non-profit corporations in 
unincorporated rural communities 
with a population of no more than 10,000.  Rates for loans may 
be made at poverty, intermediate or 
market interest rates and are subject to change quarterly.  Term of the 
loan may be for up to 40 years.  
Loans and grants are limited to applicants serving rural areas and 
towns with populations not in 
excess of 10,000.  Applicants must not be able to obtain the financing 
form other sources and/or their own 
resources at rates and terms they can afford.  Funds may be used to 
construct and develop water and 
waste disposal systems-including solid waste disposal and storm 
drainage.   Loans and grants are limited to 
applicants serving rural areas and 
towns with populations not in excess of 
10,000.   Term of the loan may be for up to 40 years.   Ongoing 
Alabama Business and 
Industry 
Guaranteed Loans USDA  Loan Objective is to bolster existing 
private credit structure through the 
guarantee of quality loans that will 
provide lasting community benefits by increasing employment and 
improving the economic and 
environmental climate of rural communities.   Priority given to 25,000 population or 
less.   Loan programme funded by Rural Economic and 
Community Development (REDC) to strengthen 
the economy of rural communities.  Indirect 
financing/loan to commercial or other authorized lenders in any area other th an an incorporated city 
or town with greater than 50,000 population and 
urbanized area contiguous and adjacent to such city or town.   Ongoing  
   G/SCM/N/123/USA
 Page 57State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alaska Commercial 
Fishing Revolving 
Loan Fund Department of 
Commerce and 
Economic 
Development Loan The Commercial Fishing Revolving 
Loan Fund provides long-term, low 
interest loans to commercial fishing 
businesses. Statewide.  The general requirements 
are that the recipient be an Alaskan 
resident for the prior two years and that 
any child support payments are not outstanding.  The creditworthiness of 
an applicant is reviewed by means of a 
detailed examination and analysis of the recipient's application which 
requires that information be provided 
regarding:  assets and liabilities, cash accounts, securities, accounts 
receivable, vessels owned, real estate 
owned, notes payable, current and projected profit ands loss statements, 
non-fishing income and household and 
living expenses.   The interest rate is 2 per cent above the prime rate, 
not to exceed 10.5 per cent.  Interest rates will be 
fixed at time of loan approval and are consistent 
with local commercial rates.  Maximum loan term is 15 years.  The average loan amount given under 
the programme is $40,400.  The maximum amount 
is $300,000.  Ongoing 
Alaska Rural 
Development 
Assistance Grants Department of 
Community and 
Regional Affairs Grant Competitive grants to communities. Communities with fewer than 
900 people or a lack of centralized 
water and sewer systems serving the 
majority of residents, a lack of organized police of fire protection, or a 
lack of medical and dental service 
other than those provided by the Indian Health Service. Each grant can provide a maximum of $50,000 per 
community. Ongoing 
Alaska Rural 
Development Assistance Mini-
grant Program Department of 
Community and Regional Affairs Grant Grants for economic development 
projects for planning or implementation of business start-up 
or expansion, manufacturing, 
tourism development or other economic enterprises that increase 
jobs, income or services in rural 
Alaska communities. Communities with fewer than 10,000 
people.  Grants are provided to native village councils, and regional or local 
non-profit corporations which serve 
eligible communities.  With Department's approval, a community 
may submit an application with a 
public or private for-p rofit entity if the 
community will receive a specified 
benefit. Maximum $30,000 per community per fiscal year. 
 Funding level during FY 98 were approximately 
$200,000. Ongoing 
Alaska Denji Fund Alaska Minority 
Business 
Development 
Center, Tanana Chiefs 
Conference 
Center Financing To improve the potential for 
economic growth in rural areas (in 
the TCC region).   Sole proprietorships, partnerships, 
corporations, cooperative.  In addition, 
any ANCSA corporation or Alaska 
Native Tribe locating a business in a rural area is eligible. Direct loans ranging from $1,000 to $150,000.  
Loan term is 1 to 15 years, depending on the 
project.  No repayment penalty. Interest rate is 1 
per cent above the prime rate.  A loan commitment fee of 1 per cent will be assessed on the principal 
amount of each loan.  Each  applicant will normally 
be required to provide in the form on new equity a minimum of 25 per cent of the total cost of the 
project.  Collateral will be obtained from the client 
in order to secure the lo an.  Adequate insurance 
will also be required.   Ongoing  
  G/SCM/N/123/USA 
Page 58 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Alaska Small Business 
Economic 
Development 
Revolving Loan Fund Department of 
Commerce, 
Community, and 
Economic Development 
and Alaska 
Division of Investments 
(ADI) Financing To create significant long-term 
employment and diversify the 
economy by providing start-up and 
expansion capital for small businesses.  Emphasis is placed on 
projects, which promise the greatest 
long-range positive economic impact on a community.   Applicants will be required to obtain 
additional private, non-public 
financing in an amount not less than 
twice the amount requested under the application.  Loans may be made to 
companies, which are "small 
businesses" as defined by the US Small Business Administration, and are 
located within rural areas as defined by 
the programme guidelines.   Financing of either industrial or commercial 
ventures will be considered.  The Loan 
Administration Board will determine interest rates 
and terms on loans;  they can be expected to be at a fixed rate and below the prevailing market rate for 
loans of similar size, maturity and purpose in the 
project area.  The maximum loan amount is $300,000, and the minimum $10,000. Ongoing 
Alaska State Underground 
Storage Tank Revolving Loan 
Fund Department of 
Environmental Conservation 
(DEC), Division 
of Spill Prevention and 
Response Financing To assist owners or operators of 
underground storage tanks to clean up underground storage tanks.   Owners of regulated underground 
storage tanks, including municipalities and businesses, but excluding state and 
federal government.  To be eligible 
tanks must be registered with DEC and comply with state and federal 
regulations. New applications are no 
longer being accepted.   Not available. Ongoing 
Arizona Defense 
Restructuring 
Program Department of 
Commerce  Tax 
Credit/Tax 
Incentive  To assist defence contractors in the 
state in maintaining and attracting 
contracts with the Department of Defense (DOD);  and to encourage 
defence contractors to diversify into 
commercial markets, adopt new manufacturing processes and 
technologies, and consolidate 
facilities into this state.   Defence contractors (manufacturer, 
assembler or fabricator).  No new 
certifications to the Department of Revenue after 30 June 2001.   A credit allowed against corporate income taxes 
for up to 40 per cent of the real and personal 
property taxes paid base d on jobs retained and 
created;  corporate and individual income tax 
credits for increases in net employment above an 
established baseline.  The credit is a dollar amount allowed for each new employee equalling $7,500 
over five years;  and de preciation or amortization 
costs of capital investments may be subtracted from Arizona gross income equal to one-half of the 
time period allowed under the US Internal Revenue 
Code.   Ongoing 
Arizona Enterprise Zone 
Program Arizona 
Department of 
Commerce Tax Credit To improve the economies of areas 
in the state with high poverty or 
unemployment rates by enhancing 
opportunities for private investment in certain areas called enterprise 
zones.   Benefits apply to businesses located in 
disadvantage areas designated as state 
enterprise zone creating new full-time 
jobs that pay at least a designated "county wage" and provide health 
insurance coverage for which the 
company pays at least 50 per cent.  Thirty-five per cent of the jobs for 
which the tax credits are claimed must 
be filled by zone residents.   Provides an income tax credit for net increases in 
qualified employment positions.  These credits 
may be up to $3,000 per qualified employment 
position over three years.  In addition, qualified manufacturing businesses locating or expanding 
within these zones can apply for a class six 
property tax classification (5 per cent of full-cash value) for a period of 5 years.  (Primary portion of 
property tax is reclassified). Ongoing  
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Arizona Military Reuse 
Zone Program Arizona 
Department of 
Commerce Tax Credit Eases the restrictions on the 
designation and renewal of a closed 
military facility as a military reuse 
zone by allowing the Governor to designate the zone upon either the 
execution of a long-term lease or 
title transfer. Manufacturers, assemblers, or 
fabricators of aviation or aerospace 
products, as well as providers of 
aviation or aerospace services, located within a Military Reuse Zone.   Companies will have their real and personal 
property classified as class six property with an 
associated assessment ratio of 5 per cent, normally 
at 25 per cent, for a period of five years.  In addition, tax credits are based upon net new 
employees.  The credit is a dollar amount allowed 
for each new employee up to $7,500 (up to five years).  There is also an exemption of the (5.6 per 
cent state portion) Transaction Privilege Tax 
available for a prime cont ractor having a contract 
with a qualified MRUZ bus iness for work in the 
zone.   Ongoing 
Arizona Motion Picture 
Production State 
Transaction Privilege Tax 
Refund Arizona 
Department of 
Commerce Tax Refund Film incentives  Only purchased tangible goods and 
leased property can be claimed for 
refund.  Feature films, telefeatures, music videos, documentaries, episodic 
television series and other television 
production must meet the $1 million expenditure threshold of qualified 
spending over any consecutive 12-
month period for one or more productions or portions thereof shot in Arizona to be eligible.  Commercial 
advertising production must meet the 
$250,000 expenditure threshold in qualified spending with the same time 
parameters as features. A 50 per cent transaction privilege (sales) tax 
refund to qualifying production companies for 
projects filmed in Arizona.  Specific Department of Revenue (DOR) rules must be followed to both 
apply and qualify for this rebate against the 5.6 per 
cent state sales tax.   Ongoing 
Arizona Credit for Motion 
Picture Production 
and Investment Arizona 
Department of 
Commerce Tax Credit To encourage film production 
within the State.   Any single medium or multimedia 
programme, including commercial 
advertising that is created by production activities conducted in 
whole or part within the state.   Computes the tax credit as fo llows:  1)  If the total 
amount of the actual investment made and spent by 
the certified production in Arizona as a production-related cost is more than $100,000 but less than or 
equal to $5 million, the cr edit is 10 per cent of the 
actual investment made by the taxpayer.  2)  If the total amount of the actua l investment made and 
spent by the certified production in Arizona as a 
production-related cost is more than $5 million but less than or equal to $10 million, the credit is 
15 per cent of the actual investment made by the 
taxpayer.  3)  If the total amount of the actual investment made and spent by the certified 
production in Arizona as a production-related cost 
is more than $10 million, the credit is 20 per cent of the actual investment made by the taxpayer.   Ongoing  
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Programme 
Arkansas  ArkPlus Arkansas 
Department of 
Economic 
Development State 
Income Tax 
Credit This programme is a discretionary 
incentive used in competitive 
situations that provides a state 
income tax credit based upon a percentage of the total project 
investment.  The eligible business 
meet the investment and payroll thresholds for the tier in which it 
locates.   Manufacturers classified in sectors 31-
33 in the North American Industrial 
Classification System, as in effect 1 
January 2005;  Computer related Businesses deriving at least seventy-
five per cent of their revenue from out-
of-state sales.  Businesses primarily engaged in motion picture productions 
deriving at least seventy-five per cent 
of their revenue from out-of-state sales.  Distribution centres and intermodal 
facilities;  Office sector businesses;  
National or Regional corporate headquarters; Firms primarily engaged 
in commercial, physical and biological 
research as classified in the North American Industrial Classification 
System code 541710, as in effect 
1 January 2005;  and Scientific and technical services businesses deriving 
at least seventy-five per cent of their 
revenue from out-of-state sales and paying wages in excess of one hundred fifty per cent of the county or state 
average hourly wage, whichever is 
less.   The amount of the credit is ten per cent (10 per 
cent) of the total project investment.  The credit 
may be used to offset fifty per cent (50 per cent) of 
the business' state income tax liability.  Any unused credit may be carried forward for a period 
of nine (9) years.   Ongoing 
Arkansas  Research & 
Development Arkansas 
Department of Economic 
Development State 
Income Tax Credit The Research and Development 
incentives are intended to provide incentives for uni versity-based 
research, in-house research and 
research and development in start-up, technology based enterprises.   Businesses that contract with Arkansas 
universities for research and development; existing, mature firms 
conducting in-house research; and new 
"targeted" businesses engaged in research and development.   The amount of the income tax credits earned is 
based upon a percentage of eligible research and development expenditures.   Ongoing 
Arkansas  Targeted Business 
Payroll Credit Arkansas 
Department of Economic 
Development State 
Income Tax Credit The programme offers a state 
income tax credit for job creation based on the payroll of the new 
employees hired as a result of the 
project.  The qualifying threshold is determined by the tier in which the 
company locates.   "Targeted Businesses" are a grouping 
of growing business sectors, the businesses of which:  have been 
operating in the state for less than five 
(5) years;  and pay at least one hundred and fifty per cent of the lesser of the 
county or state average wage; and 
those groupings, not to exceed six, include the following:  Advanced 
materials and manufacturing systems;  
Agriculture, food and environmental sciences;  Biotechnology, bioengineering and life sciences;  
Information technology;  
Transportation logistics;  and Bio-based products.   The amount of the income tax credits earned is 
based upon ten per cent of the payroll of the targeted business.  The in come tax credits may be 
used to offset a maximum of one hundred thousand 
dollars ($100,000) per tax year.  Any unused credits may be carried forward for a period of nine 
years.   Ongoing  
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Programme 
Arkansas  Motion Picture 
Incentive Act Arkansas 
Department of 
Economic 
Development Sales and 
Use Tax 
Refunds This programme provides a sales 
tax refund to motion picture 
production companies for sales 
taxes paid during production.   Motion picture production companies 
producing a film, music video, 
documentary, episodic television show 
or commercial advertising project.  The minimum investment is five hundred 
thousand dollars within a six month 
period or one million dollars within a twelve month period.   Sales taxes paid in connec tion with the filming or 
production.   Ongoing 
Arkansas  Tax Increment 
Financing Arkansas 
Department of 
Economic 
Development Bond 
Program Enable local governments to issue 
bonds to finance improvements in a 
redevelopment district.  The bonds 
are secured and paid back from the increased revenue generated as a 
result of the improvements.   A redevelopment district must be in an 
area that is considered blighted, 
deteriorated or underdeveloped.  Not available.   Ongoing 
California Enterprise Zones Technology, 
Trade and 
Commerce Agency Tax Credit California's Enterprise Zone 
programme is an innovative 
partnership comprised of state government, local government and 
private businesses.  The Enterprise 
Zone programme spurs business development in 39 designated areas 
through special zone incentives.  
Companies already located or that locate in Enterprise Zones can take advantage of state and local 
incentives and programmes not 
available to businesses outside the Enterprise Zone.  California tax law 
allows businesses that experience a 
loss for the year to  carry this loss 
forward to the next year in order to 
offset income in the following 
years. Businesses within LAMBRA and EZs can carry over for 
15 years.  California tax law allows 
businesses that experience a loss for the year to carry th is loss forward to 
the next year in order to offset 
income in the following years.  Businesses within LAMBRA and 
EZs can carry over for 15 years There are 39 designated areas.  
Designations are made based on 
proposals from cities and counties containing areas meeting these criteria.  
These areas are then evaluated 
competitively on the basis of local economic development incentives 
designed to complement state 
incentives. Tax credits and benefits available to companies 
locating in Enterprise Zones include:  (1) tax 
credits for sales or use taxes paid on up to $20 million of qualified machinery purchased per 
year;  (2) a hiring credit for wages paid to qualified 
employees during the employees' first 60 months on the job;  (3) a 15 year carryover of up to 100 per 
cent of net operating losses;  (4) expensing up to 
$40,000 of certain depreciable property;  (5) lender interest income deductions for loans made to zone businesses;  and (6) preference points on state 
contracts. 
In addition, local incentives may be available that include reduction or elimin ation of local permit 
and construction-related fees, expeditious 
processing of plans and permits, reduced utility 
rates, reduced land costs, assistance in employee 
hiring, low-cost financing and low-interest 
revolving loans.  For LAMBRA, new businesses can carryover 100 per cent of their losses over 
eight years if the loss is in their first year of 
operation, 100 per cent over seven years if in their second year of operation and 100 per cent over six 
years if in their third year of operation.   Ongoing  
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Programme 
California Local Agency 
Military Base 
Recovery Area California Trade 
and Commerce 
Agency Tax Credit Local Agency Military Base 
Recovery Area (LAMBRA) 
legislation (AB 693) was drafted to 
stimulate job creation in areas experiencing military base 
downsizing and closure.  It was 
signed into law in 1993 in response to severe job loss among California 
military and civilian personnel as a 
result of base closures.  Per legislation, the state has been 
geographically divided into five 
regions.  Communities competed for the LAMBRA Zone designation 
which is limited to one per region.  
A LAMBRA may consist of only the former base or a specified 
portion of it. A LAMBRA 
designation is binding for eight years. 
 
LAMBRA designations are similar to Enterprise Zones. In 1995, the first three military site 
designations under the state's 
LAMBRA programme included Mare 
Island Naval Shipyard in Vallejo, Castle Air Force Base in Merced and 
George Air Force Base in Victorville.  
In 1997, Alameda Naval Air Station in Alameda and the Tastin Marine Corps 
Air Station received their designations The designations allow communities to extend 
California Enterprise Zone tax credits to 
companies locating in a LAMBRA Zone.  As with 
Enterprise Zone communities, LAMBRA communities also have co mmunity incentives as a 
part of the business attraction package.   Ongoing 
California Old Growth 
Diversification Revolving Loan 
Fund California Trade 
and Commerce Agency Loan With funding from the US Forest 
Service, the Old Growth Diversification programme 
provides low cost capital to 
businesses to create and retain jobs in areas of Northern California 
affected by timber harvest 
reductions and sawmill and related plant closures.  Emphasis will be 
placed on value-added wood 
products and other resource-related manufacturing, and on business 
ventures which diversify the local 
economy.  Where possible, preference will be given to those 
projects which employ displaced 
timber workers.  Expanding businesses as well as start-up ventures will be considered. Statewide.   Businesses may borrow from $25,000 to $100,000.  
Loan terms may go up to 10 years for real estate or equipment, and up to five years for working 
capital.  Lines of credit with a one-year maturity 
are also available.  The interest rate may be fixed or variable, and will be set at the time of loan 
approval, depending on the borrower's individual 
circumstances.   Discontinued 
as of 30 June 2003  
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California Recycling Market 
Development 
Zone Program California 
Integrated Waste 
Management 
Board (part of CalEPA) Mixed 
Financing The Recycling Market 
Development Zone Program was 
developed by the California 
Environmental Protection Agency, Integrated Waste Management 
Board.  Businesses locating within 
the 40 designated zones can take advantage of low interest loan 
packaging, local permit 
streamlining, technical assistance and information sharing.  In 
addition, RMDZ loans are available 
for recycling projects.   Any business or local government 
agency located in a recycling Zone 
utilizing post-consumer or secondary 
waste material in their production process may apply for a recycling loan.  
Private businesses and not-for-profit 
organizations may borrow funds for real property, equipment, working 
capital, or refinancing of onerous 
debts.   Each eligible business or local government agency 
may borrow up to 50 per cent of the cost of any 
project with a maximum of $1 million.   Ongoing 
California The STAR 
Partnership Commerce and 
Economic 
Development 
Program Tax 
Incentives To encourage film production 
within the State.   Filmmakers No state hotel tax on occupancy, no sales or use tax 
on production or postproduction services on 
motion pictures or TV film s, five per cent sales tax 
exemption on purchase or lease of postproduction equipment.   On going  
California Community 
Development 
Block Grant 
Program Housing and 
Community 
Development Grant Create or retain jobs for low-
income workers in rural 
communities Businesses that locate in counties with 
fewer than 200,000 residents in 
unincorporated areas and cities with 
fewer than 50,000 and are not participants in the US Department of 
Housing and Urban Development 
(HUD) Community Development Block Grant (CDBG) programme.   Grants of up to $500,000.   On going  
Colorado Enterprise Zone Office of Econ. 
Dev & Int'l 
Trade Tax Credit Tax credits granted for investment 
and employment which takes place 
within 16 designated enterprise 
zones.  Companies must invest in equipment used exclusively in the 
zone;  or they must hire new full-
time employees;  or conduct R&D activities in the zone;  or invest in 
the rehabilitation of a building that 
is over 20 years old and vacant; or make a contribution to approved zone development projects or child 
care in zones.   There are currently 16 zones in the 
state, 8 are in rural areas.  Legislation 
provides for a maximum of 16 zones.  
Any business locating or expanding anywhere within a designated 
enterprise zone is potentially eligible.  
Specific programmes, however, are targeted at agricultural processing, 
manufacturing, and R&D. An investment credit of 3 per cent is for 
investments in equipment used exclusively in the 
enterprise zone.  There is a 25 per cent income tax 
credit (not to exceed $50,000) to rehabilitate vacant buildings.  There is a 10 per cent credit for 
employer job training expenses.  There is a 
$500 tax Credit for each new full-time employee and an additional $500 credit for each full-time 
agricultural processing or manufacturing 
employee.  A 3 per cent tax credit is granted for increases in R&D expenditure s.  There is also a tax 
credit of 25 per cent (not to exceed $100,000) for 
private contributions to local zone administrators 
for enterprise zone development projects and for promoting child care within zones.  Localities also 
have the option of refunding local property tax 
and/or sales and use tax on equipment and 
supplies. Ongoing  
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Programme 
Colorado Biotech Sales Tax 
Refund Department of 
Revenue Tax Refund To promote business within the 
state. "Qualified taxpayer" means a C 
corporation, as defined in section 39-
22-103 (2.5), a partnership, as defined 
in section 39-22-103 (5.6), a limited liability company that is not a C 
corporation, an S corporation, as 
defined in section 39-22-103 (10.5), or a sole proprietorship that purchases, 
stores, uses, or consumes tangible 
personal property to be used in Colorado directly and predominately in 
research and development of 
biotechnology.   For the calendar year commencing 1 January 1999, 
and for each calendar year thereafter, each 
qualified taxpayer shall be allowed to claim a 
refund of all state sales and use tax paid by the qualified taxpayer, pursuant to parts 1 and 2 of this 
article, on the sale, storage, use, or consumption of 
tangible personal property to be used in Colorado directly and predominately in research and 
development of biotechnol ogy during that calendar 
year. To claim the refund a qualified taxpayer shall 
submit a refund application to the department of 
revenue on a form provided by the department. Such application shall be submitted no earlier than 
1 January and no later than  1 April of the calendar 
year following the calendar year for which the refund is claimed.  The application shall be 
accompanied by proof of payment of state sales 
and use taxes paid by the qualified taxpayer in the immediately preceding calendar year. 
  Ongoing 
Connecticut Apprenticeship 
Training Tax 
Credit Connecticut 
Department of 
Labor Tax Credit This is a tax credit granted under 
Gen. Stat.  12-217g and amended 
by P.A. 97-295. The manufacturing trades of machine 
tools, plastics, or metals.   A firm may apply for a credit of up to $4800 per 
apprenticeship.  The amount of the credit is limited 
to the lesser of 50 per cent of the actual wages paid 
or the total number of working hours during the 
year multiplied by $4.00, or $4,800.   Ongoing 
Connecticut Connecticut 
Capital Access 
Fund:  Urban Connecticut 
Development 
Authority Loan Access to bank lending through use 
of portfolio loan insurance.  Loss 
reserves up to 29.5 per cent used to induce bank lending in targeted 
areas.  Up to 9.5 per cent cash 
reserve deposited for other small business loans.  Direct loans up to 
$250,000 for buildings, equipment 
and working capital for specialized projects. Businesses located in New London or 
Windham counties or one of 25 
designated municipalities are eligible for targeted business loans.  Special 
emphasis on minority and women-
owned businesses.  Small business Assistance loans available for 
businesses with 100 or fewer full-time 
employees. No prior CDA approval is  required for new bank 
loans up to $250,000.  Maximum loan $500,000.  
Maximum 15 year term. Ongoing  
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Programme 
Connecticut Connecticut 
Growth Fund Connecticut 
Development 
Authority Loan The purpose of  the programme is 
to provide financing for small 
contractors and minority businesses 
that might have difficulty obtaining commercial financing.  Direct state 
loans and equity investments 
administered by the Connecticut Development Authority to small 
businesses for fixed asset financing, 
working capital, and start-up capital for those businesses vital to the 
economic base of the state.  Special 
purpose financing loans available for certain businesses unable to 
obtain conventional financing, 
including small contractors, minority businesses, water 
facilities, enterprise zone businesses 
or other impacted businesses.  Working capital requirements are 
determined by examining a 
prospective borrower's short-term obligations such as wages, taxes and accounts  payable.  Loans are 
not made to "loss-making" 
enterprises.   Any for-profit small business whose 
gross sales including those of affiliates 
did not exceed $25 million in the most 
recent fiscal year. Loans are made in amounts form $50,000 to 
$4 million within which real property loans cannot 
exceed 90 per cent of their cost or 20 years in term;  
machinery and equipment cannot exceed 80 per cent of cost nor 10 years in term;  and working 
capital cannot exceed those amounts determined to 
be necessary by the authority for a maximum term of seven years.  The rate of interest is.  50 per cent 
over the latest 30-year US Treasury rate 
outstanding as of the first day of each calendar quarter.  Limit $4 million to any one borrower or 
SBIC.  Up to $1 million to state or local 
development corporations.   Ongoing 
Connecticut Connecticut 
Innovations Connecticut 
Innovations, Inc. Equity The goal of these efforts is the 
creation and sustainable growth of a community of high technology 
companies vital to Connecticut's 
future.   To be considered as a Connecticut 
Innovations portfolio client, a company must have a proprietary technology, 
since this is typically the collateral for 
providing funds.   Product development financing is available for a 
minimum of 40 per cent of the project funds between $50,000 and $1,000,000 in funds.  
Companies may apply for up to $500,000 under 
CTP.  Investments are structured using a variety of vehicles, including debt, equity, quasi-equity and 
royalties.  Generally, the fund expects a 
compounded annual rate of return of 25-40 per cent.  The structure of the investment terms 
depends upon the risk assessment made by 
Connecticut Innovations' staff, and the needs of the business. Ongoing 
Connecticut Electronic Data 
Processing 
Equipment Property Tax 
Credit Department of 
Revenue 
Services Tax Credit The purpose of this programme is 
to promote economic development 
and job creation by encouraging investment in data processing 
equipment in a variety of industries 
(e.g., insurance co mpanies, hospital 
and medical services corporations, 
health care centres, air carriers, 
railroads, cable companies and utilities). Statewide Property tax credit that provides a 100 per cent 
credit for property tax paid on electronic data 
processing equipment.  Unused credits may be carried forward for five income years. Ongoing  
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Programme 
Connecticut Enterprise 
Corridor Zones Department of 
Economic and 
Community 
Development Mixed Tax Enterprise Corridor Zones are 
located along Route 8 in the state's 
Naugatuck Valley and Interstate 
395 in the eastern region of the state.  The benefits available in an 
enterprise corridor zone are the 
same as in an enterprise zone, subject to the similar qualifying 
terms and conditions. The communities located in the 
corridor zones are:  Ansonia, Beacon 
Falls, Derby, Griswold, Killingly, 
Lisbon, Naugatuck, Plainfield, Putnam, Seymour, Sprague, Sterling and 
Thompson.  Municipalities in the 
enterprise corridor zones are not classified as targeted investment 
communities, and are therefore not 
eligible to extend urban job benefits. In the case of an Enterprise Corridor Zone, for the 
purposes of obtaining the enhanced 50 per cent 
level of corporate credits, the hiring level for new 
full time positions remains at 30 per cent of those positions being filled by residents of the 
community in which the project takes place, who 
are JTPA eligible.   Ongoing 
Connecticut Enterprise Zone or 
Entertainment 
District Tax Credit State of 
Connecticut 
Department of 
Economic And Community 
Development Tax Credit Tax credit for relocating or 
expanding a facility within a 
designated enterprise zone or 
entertainment district. Enterprise zones or entertainment 
districts.  Manufacturers, R&D, 
warehousing and certain services and 
entertainment related business as defined by regulations. Allows a business 25 per cent or 50 per cent of 
their allocable State Corporate business tax as a 
credit.  Corporations may claim this credit for 
10 years beginning with the first year following certification. Ongoing 
Connecticut Enterprise Zone 
Program State of 
Connecticut 
Department of 
Economic and Community 
Development Mixed Tax Connecticut's  Enterprise Zone 
Program represents a state and local 
partnership for the promotion of 
good business development, residential development, and the 
creation and retention of jobs. It 
targets a variety of state and local incentives for specific areas of 
17 Connecticut municipalities.   Manufacturers and certain qualifying 
service sectors firms in the targeted 
investment communities.  Programme 
geared toward manufacturing and certain service sector businesses as 
well as research and development 
related to manufacturing and distributors of manufactured products.  
Eligible facilities include newly 
constructed facilities, older facilities idle for at least one year prior to being 
acquired through lease or purchase, 
and facilities that are substantially renovated or expanded.  Also, facilities 
must have a standard industrial code 
2000 to 3999.   Manufacturing facilities located within the zones 
are eligible for the followi ng assistance:  1) Five-
year, 80 per cent abatement of local taxes on real 
estate improvements and personal property acquisitions:  2) Ten-year, 25 per cent credit on 
corporate business taxes, 50 per cent if at least 
5 per cent of all new employees are from the enterprise zone or from the municipality's 
disadvantaged population.  3) Low-cost loans and 
free technical assistance;  4) Job-training and placement assistance;  5) Exemptions on both state 
real estate conveyance taxes and sales taxes on 
machinery replacement parts.  Both commercial businesses and residential facilities (where tenants 
satisfy maximum income level criteria) are eligible 
for a seven-year gra duated tax deferral on 
increased assessments for improvements to 
property, exemptions on state real estate 
conveyance tax, and local incentives.   Ongoing 
Connecticut Financial 
Institutions Tax 
Credit Department of 
Economic and 
Community Development Tax Credit This credit is available to financial 
institutions which construct a new 
facility of at least 900,000 square feet and create a minimum of 
1,200 new jobs. Statewide Credit levels of 30 per cent, 40 per cent or 50 per 
cent are based on the number of qualified 
employees.  This credit may be taken for up to ten years. Ongoing  
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Connecticut Manufacturing 
Assistance Act State of 
Connecticut 
Department of 
Economic and Community 
Development Loan The most comprehensive of the 
Department's financing 
programmes, this act allows for the 
provision of financing for a variety of projects. Statewide- Manufacturing or economic 
base business.  All sectors defined by 
SIC codes from 2000 to 3999 are 
included.  Funds 50 per cent of total project costs;  up to 
75 per cent for joint ventures between two or more 
municipalities, up to 90 per cent in targeted 
investment communities, and up to 100 per cent for defence diversification projects.  The term of the 
state's economic development loans is typically for 
a period of ten years as recipients of said financial assistance are required by statute to maintain their 
operations in the state of a ten year period.  
However, the state has the authority to set any term it deems appropriate.  Inte rest rate charged under 
the programme are slightly below market rates. 
Maximum amount is capped at $10 million.  Ongoing 
Connecticut Manufacturing 
Credits to 
Facilities Located in Distressed 
Municipalities and 
Enterprise Zones Department of 
Revenue 
Services Tax Credit Tax Credits up to 50 per cent are 
available through the Department of 
Economic and Community Development (DCED) for 
corporations (including 
manufacturing facilities) that are located in designated distressed 
municipalities and enterprise zones 
within Connecticut. Statewide Tax credits up to 50 per cent of eligible expenses. Ongoing 
Connecticut Manufacturing 
Facility in a High 
Unemployment 
Area Tax Credit State of 
Connecticut 
Department of 
Economic and Community 
Development Tax Credit A credit may be applied against the 
portion of the corporation business 
tax allocable to a manufacturing 
facility located in a distressed municipality. Operating in a designated area of high 
unemployment The credit period lasts for ten years beginning with 
the first year following certification. Ongoing 
Connecticut Tax Credits for 
Manufacturers Located in 
Connecticut's 
Targeted Investment 
Communities State of 
Connecticut Department of 
Economic and 
Community Development Tax Credit A ten year tax credit for businesses 
relocating to or expanding in one of Connecticut's Targeted Investment 
Communities. Targeted Investment Communities- 
Eligible activities include investments in manufacturing facilities or in 
research and development activities 
related to manufacturing. 25 per cent corporate tax credit for 10 years. Ongoing 
Connecticut Tax Increment 
Financing Connecticut 
Development 
Authority Bond Tax-exempt and taxable bonds for 
special economic development 
projects using incremental state tax 
revenues as partial security for the bonds. Large-scale economic development 
projects approved by the Authority 
prior to 7/1/96 and determined to be 
self-sustaining through the generation of incremental taxes collected under 
the sales, admission, cabaret and dues 
taxes. Negotiated sale or competitive bid with bond 
purchasers developed in conjunction with the State 
Treasurer.  Terms generally 10 and 30 years. Ongoing  
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Programme 
Connecticut Urban Jobs 
Program Department of 
Economic and 
Community 
Development Mixed Tax The Urban Jobs Program provides 
incentives to manufacturing 
businesses to encourage the 
location and expansion of industrial facilities in targeted investment 
communities within the state.  The 
incentives are primarily tax incentives. There are presently 17 targeted 
investment communities.  Facilities 
must have a standard industrial code 
2000 to 3999. Businesses located within the targeted areas are 
eligible for the following assistance:  1) An 80 per 
cent local property tax abatement for five years for 
both real and personal property;  2) A corporate business tax reduction of 25 per cent for ten years;  
3) Working capital loans fo r small business;  4) A 
0.5 per cent reduction in charges for state industrial mortgages guarantees.  Facility owners are entitled 
to the property tax incentiv es;  all other incentives 
are reserved for facility occupants. Ongoing 
Conneticut MetroHartford 
Growth Fund Department of 
Economic and Community 
Development Loan To enhance employment 
opportunities by easing the burden of expanding, building or relocating 
businesses within MetroHartford. 1) Businesses which plan to create new 
jobs within the next  three years in the 
MetroHartford area.  2) Businesses in 
the following "growth clusters":  
manufacturing, financial services, health care, information technology, 
distribution, tourism/entertainment, 
and environmental technologies. Maximum loan amount is $350,000 per project. 
Most loans amount to $20,000 per new, full-time, permanent job to be created over the next three 
years. On going  
Conneticut Information 
Technology 
Project Grants Conneticut 
Development 
Authority Grant To encourage developers and 
companies to utilize brownfields or 
industrial sites within urban communities. Developers and companies that engage 
in information technology projects and 
must be located with in an enterprise 
zone, urban communities, or distressed 
areas. Not available. On going  
Conneticut Qualified 
Manufacturing Plant Department of 
Economic and Community 
Development Tax credit 
and Tax abatement  To encourage business development 
within the State. Any targeted investment community 
with approval from the Commissioner of the Department of Economic and 
Community Development, designated 
a vacant or underutilized manufacturing plant, with an area of at 
least 500,000 square feet. 1) 5 year, 80 per cent abatement of local property 
taxes.  2) 10 year, 25 per cent or 50 per cent credit on that portion of the Connecticut Corporation 
Business tax. On going  
Conneticut Railroad Depot 
Zone Department of 
Economic and 
Community Development Tax credit 
and Tax 
abatement  Encourage technology related 
products in various fields than have 
the potential to create jobs and stimulate the local economy. Any targeted investment community 
with approval from the Commissioner 
of the Department of Economic and Community Development, designated 
as an under utilized railroad depot, 
located outside the boundaries of the existing Enterprise Zone. 1) 5 year, 80 per cent abatement of local property 
taxes.  2) 10 year, 25 per cent or 50 per cent credit 
on that portion of the Connecticut Corporation Business tax. On going  
Conneticut CT Inner City 
Business Loan 
Guarantee Program Department of 
Economic and 
Community Development Loan To encourage small business 
growth in designated industry 
clusters locate in the following communities:  Waterbury, Hartford, 
New Britain, Bridgeport and New 
Haven.   Small Businesses Loan amounts from $50,000 to $250,000, 
discounted fixed interest rates and 1per cent 
application fee. On going   
   G/SCM/N/123/USA
 Page 69State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Delaware Corporate Income 
Tax Credits Department of 
Finance Tax Credits To encourage new and expanded 
facilities within targeted industries 
in Delaware. Firms within targeted industries, 
including:  manufacturers;  
wholesalers;  laboratories used for 
scientific, agricultural, or industrial research, development or testing;  
computer processors;  engineering 
firms, consumer credit reporting services;  wholesale of computer 
software;  telecommunications and 
aviation services. 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.  Total credits in any taxable 
year cannot exceed 50 per cent of the pre-tax liability.  Unused credits can be carried forward 
during the ten-year Programme.  Selected 
commercial and retail businesses which locate in one of the 30 targeted census tracts and meet the 
minimum investment/employment criteria, qualify 
for credits of $400/new employee and $400/$100,000 investment. Ongoing 
Delaware Delaware Access 
Program Delaware 
Economic  
Development Authority Loans To provide a source of financing to 
companies. To companies that need financing but 
have found that traditional funding 
sources difficult to obtain. Amount are negotiated between the bank and the 
borrower.  The Delaware Access Program is 
designed to give banks a flexible and extremely non-bureaucratic tool to make business loans that 
are somewhat riskier than a conventional bank 
loan, in a manner consistent with safety and soundness.   Outgoing.  
  G/SCM/N/123/USA 
Page 70 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Delaware Delaware 
Strategic Fund Delaware 
Economic  
Development 
Authority Loan, 
Grants, and 
Equity 
Incentives The Delaware Strategic Fund 
represents the primary funding 
source used by The Delaware 
Economic Development Authority to provide customized financial 
assistance for job retention, creation 
or other economic development projects within the state.  
Assistance usually includes 
recapture provisions.  Some specific uses of the fund are listed below:   
a) Economic Development Loans or 
Grants  b)Green Industries Loans 
c)Governmental Units 
Development Assistance  d)SBIR Bridge Grants and  e) Brownfield Grants 
Typically, a request  for financial 
assistance from the Strategic Fund is first discussed with the Business 
Development Section of the 
Delaware Economic Development Office.  If a project is deemed to 
qualify under legislative, 
regulatory, and policy guidelines, a process begins which includes 
completion of a comprehensive 
application, staff and legal review of the application, review of the 
application and other supporting 
material at a public meeting of the Council on Development Finance, 
final staff review, approval by the 
Chairperson of The Delaware Economic Development Authority, 
followed by a contract that 
memorializes terms and conditions.  All industries. Varies on an indi vidual project basis.   Ongoing 
Delaware Technology-Based 
Seed Fund Delaware 
Economic  
Development Authority Equity The Fund's intent is to foster high-
wage, fast-growing small 
businesses in technology fields such as biotechnology, advanced 
materials, clean energy, information 
technology, and new chemical applications. Delaware entrepreneurs and start-up 
ventures with less than 2 years of 
sustained operating history. $50,000.   Ongoing  
   G/SCM/N/123/USA
 Page 71State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Delaware Corporate Income 
Tax Credits Department of 
Finance Tax Credits To encourage new and expanded 
facilities within targeted industries 
in Delaware. Firms within targeted industries, 
including:  manufacturers; wholesalers;  
laboratories used for scientific, 
agricultural, or industrial research, development or testing; computer 
processors;  engineering firms, 
consumer credit reporting services;  wholesale of computer software;  
telecommunications and aviation 
services.   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.  Total credits in any taxable 
year cannot exceed 50 per cent of the pre-tax liability.  Unused credits can be carried forward 
during the ten-year programme.  Selected 
commercial and retail businesses which locate in one of the 30 targeted census tracts and meet the 
minimum investment/employment criteria, qualify 
for credits of $400/new employee and $400/$100,000 investment. Ongoing 
Delaware Gross Receipt Tax 
Reductions 
for targeted industries locating 
within a targeted 
area. Department of 
Finance Tax 
reductions This is an enhancement to 
Corporate Income Tax Credits (See 
above).  When the targeted industry locates in a targeted area, Gross 
Receipt reductions further increase 
the incentive by providing a fifteen year reduction of Gross Receipts;  
100 per cent the first five years, 
90 per cent in the sixth year decreasing by 10 per cent each year until 5 per cent in the final 
(fifteenth) year.   Targeted industries locating in a 
targeted area. 100 per cent reduction the first five years. 
90 per cent reduction beginning in the sixth year.  
80 percent the seventh year  until the fifteenth and 
final year with a 5 per cent reduction. Ongoing 
Delaware Gross Receipt Tax 
Reductions 
for targeted 
industries. Department of 
Finance Tax 
Reductions This is an enhancement to 
Corporate Income Tax Credits (See 
above).  Gross receipt reductions 
further increase the incentive by also providing a ten year reduction 
of Gross Receipts;  90 per cent 
beginning in the first year, 80 per cent the second year until 5 per cent in the last (tenth) year.    Targeted industries eligible for 
Corporate Income Tax credits. 90 per cent reduction the first year. 
80 per cent the second year. 
70 per cent the third year;  until 5 per cent the last 
(tenth) year. Ongoing 
Delaware Headquarters 
Management Corporation 
(HMC) Department of 
Finance Tax 
Reductions Designed to attract headquarter 
operations. Headquarters:  In 2004, Delaware 
approved a new corporation category, designed to strengthen the states 
location for headquarter operations. 
This is a result of various states putting pressure on Delaware Holding 
Companies. The benefit equals a 20 per cent reduction in taxes 
owed for each new Delaware employee.  HMCs must pay a minimum $5,000 tax. Ongoing  
  G/SCM/N/123/USA 
Page 72 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Delaware Neighborhood 
Assistance Act Department of 
Finance Tax Credits To encourage businesses paying 
Delaware corporate taxes to invest 
in impoverished neighbourhoods. Participating Delaware businesses. The credit is equal to 50 per cent of the amount 
invested by a business in a neighbourhood 
assistance programme for tax years beginning on 
or after1 January 2000, up to a maximum of $100,000.  The total tax credits available for the 
State's fiscal year are $500,000.  Ongoing 
Delaware Recycled 
Materials Collection and 
Distribution Tax 
Credit Department of 
Finance Tax Credits To encourage recycling. A taxpayer engaged in the business of 
collecting and distributing recycled materials is entitled to job and 
investment credits.   Targeted Industry that meet the recycler definition 
receive a tax credit to $650 per employee and per $100,000 of investment.  During the ten-year life 
of credits, credits may not exceed 50 per cent of 
the company's pre-credit tax liability in any one year. Ongoing 
Delaware Non-targeted 
industry locating 
in a targeted area. Department of 
Finance Tax Credits 
& Gross 
Receipt 
Tax Reductions To encourage certain commercial 
and retail activities to locate in 
targeted areas. Designated commercial & retail 
businesses. A Corporate Income Ta x credit of $400 for each 
$100,000 of investment and $400 for each 
qualified employee. Ongoing 
Delaware Gross Receipt 
reductions for non-targeted 
industry locating 
in a targeted area. Department of 
Finance Tax 
Reductions To encourage certain commercial 
and retail activities to locate in targeted areas. Designated commercial & retail 
businesses. Ten year programme with a 90 per cent reduction 
the first year, 80 per cent the second; until 5 per cent in the final (tenth) year. Ongoing 
Delaware Corporate Income 
Tax Credits (Targeted Industry 
& Targeted Areas 
) Department of 
Finance Tax Credit Delaware has identified targeted 
industries and targeted areas for economic development purposes 
and provides tax credits for 
qualifying new and expanded facilities for up to ten years.  This 
programme has a requirement of 
job creation associated with it.   Targeted areas are defined as:  a) real 
property that is owned by any level of government or any of their agencies;  
b) real property owned by a non-profit 
organization which is organized and operated solely for the purpose of 
fostering economic development;  
c) real property which has been approved as a Delaware Foreign Trade 
Zone;  and d) 30 low income Census 
Tracts throughout the State. 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.  Total credits in any taxable 
year cannot exceed 50 per cent of the pre-tax 
liability.  Unused credits can be carried forward during the ten-year programme.  Selected 
commercial and retail businesses which locate in 
one of the 30 targeted census tracts and meet the minimum investment/employment criteria, qualify 
for credits of $400/new employee and 
$400/$100,000 investment.   Ongoing  
   G/SCM/N/123/USA
 Page 73State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Delaware Public Utility Tax 
Rebates for 
Industrial Users Department of 
Finance Utility Tax 
Reduction  
(Rebate) To assist licensed manufacturers. 
"Firms meeting the criteria for 
targeted industry tax credits are 
eligible for a rebate 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 per cent.  
The utility tax on the consumption 
of electric by licensed manufacturers and food or 
agribusiness processors is reduced 
from 4.25 per cent to 2 per cent. Additionally, electricity consumed 
in the manufacture of automobiles 
is exempt from the utility tax.  Licensed manufacturers meeting the 
criteria for targeted industry tax  
credits. The rebate equals fifty per cent (50 per cent) of the 
Public Utilities Tax imposed on new or increased 
consumption of gas and elect ricity for five years. Ongoing 
Florida  Innovation Park 
Technology Commercializatio
n Grant Program Leon County 
Research and Development 
Authority Grant Encourage technology related 
products in various fields than have the potential to create jobs and 
stimulate the local economy. Researchers and entrepreneurs in Leon 
County. Can receive up to $15,000 in grants.  Ongoing  
Florida  Capital Investment 
Tax Credit Office of 
Tourism, Trade and Economic 
Development Tax Credit The Capital Investment Tax Credit 
is an annual credit against the corporate income tax for up to 
20 years. In order to qualify for consideration 
under the programme, an applicant must be in a designated high impact 
sector (currently biomedical 
technology, financial services, silicon technology, and transportation 
equipment manufacturing) SICs 372, 
376 and 3711;  or information technology—SICs 357, 366, 367, 481, 
482 and 737).  Other industries are 
expected to be designated in the future. The amount of the annual credit is up to five per 
cent of the eligible capita l costs generated by a 
qualifying project and no more than or a specified 
percentage of the annual corporate income tax 
liability generated by the project, whichever is lower.  Those percentages are:  
 
One hundred per cent, for a project with a cumulative capital investment of at least 
$100 million; 
 Seventy-five per cent, for a project with a cumulative capital investment of at least 
$50 million but less than $100 million; and 
 Fifty per cent, for a project with a cumulative 
capital investment of at least $25 million but less 
than $50 million. Ongoing  
  G/SCM/N/123/USA 
Page 74 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Florida  Enterprise Zone 
Jobs Tax Credit 
(Corporate Income 
Tax) Office of 
Tourism, Trade 
and Economic 
Development Tax Credit Business located in a state-
designated Enterprise Zone, who 
pay corporate income tax and create 
a new full-time job, are eligible to receive a corporate income tax 
credit for wages paid to new 
employees who have been employed by the business for at 
least three months and are residents 
of a Florida Enterprise Zone. State-designated enterprise zones.  
Firms must earn more than $5,000 to 
take advantage of the credit. The credit amounts to 20 per cent of wages paid to 
new employees who are residents of a Florida 
enterprise zone.  If 20 per cent or more of the 
permanent, full-time employees are residents of a Florida enterprise zone, the credit is 30 per cent.  
The credit is available for up to two years per new 
employee.  In "Rural Enterprise Zones" businesses will receive a credit of 30 per cent paid to new 
eligible employees in a full-time job who are 
residents of a "Rural County".  If 20 per cent or more of the permanent, full-time employees are 
residents of a zone, the credit is 45 per cent. Ongoing 
Florida  Enterprise Zone 
Jobs Tax Credit 
(Sales and Use 
Tax) Florida 
Department of 
Revenue Tax Credit Business located in a state-
designated Enterprise Zone, who 
collect or pay Florida sales and use 
tax and create a new full-time job, are eligible to receive a monthly 
credit against their tax due on 
wages paid to new employees who have been employed by the business for at least three months in 
a full-time job and are residents of a 
Florida Enterprise Zone. State-designated enterprise zones. The credit amounts to 20 per cent of wages paid to 
new employees who are residents of a Florida 
enterprise zone.  If 20 per cent or more of the 
permanent, full-time employees are residents of a Florida enterprise zone, the credit is 30 per cent.  
The credit is available for up to two years per new 
employee.  In "Rural Enterprise Zones" businesses will receive a credit of 30 per cent paid to new eligible employees in a full-time job who are 
residents of a "Rural County".  If 20 per cent or 
more of the permanent, full-time employees are resident of a zone, the credit is 45 per cent. 31/12/2015 
Florida  Enterprise Zone 
Property Tax Credit Florida 
Department of Revenue Tax Credit New or expanded businesses 
located in a state -designated enterprise zone are eligible for a 
corporate income tax credit equal to 
96 per cent of ad valorem taxes paid on the new or improved property. State-designated enterprise zones.  
Firms must earn more than $5,000 to take advantage of the credit. The corporate income tax credit is available for a 
period up to five years, up to a maximum of $25,000 annually, and may be carried forward for 
five years. If 20 per cent of the permanent 
employees of the business are residents of the zone, the maximum amount of the credit is 
increased to $50,000 annually.  New or expanded 
businesses must create at least five new jobs. 31/12/2015 
Florida  Florida Enterprise 
Zone Program Office of 
Tourism, Trade and Economic 
Development 
and Florida Department of 
Revenue Tax Credit Florida's Enterprise Zone Program 
offers financial investment opportunities to businesses located 
in designated areas found in both 
urban and rural communities. Tax savings are offered to businesses 
who are located within a designated Enterprise Zone who employ zone 
residents, rehabilitate real property or 
purchase business equipment.  Tax investments are also available to 
businesses who pay either the Florida 
Corporate Income Tax or the Florida Sales and Use Tax. The following state incen tives are offered to 
encourage private investme nt in the zones as well 
as employment opportunities for the area's 
residents: 
Enterprise Zone Jobs Tax Credit (Sales & Use Tax),  
Enterprise Zone Jobs Tax Credit (Corporate 
Income Tax), Sales Tax refund for building materials, sales tax refund for business machinery 
and equipment, and sales tax exemption for 
electrical energy, and community contribution tax credit. 31/12/2015  
   G/SCM/N/123/USA
 Page 75State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Florida  High Impact 
Business 
Performance 
Incentive Office of 
Tourism, Trade 
and Economic 
Development Grant The High Impact Business 
Performance Incentive (HIBPI) is a 
negotiated performance grant 
provided to pre-approved applicants in certain high-impact sectors. In order to qualify for consideration 
under the programme, an applicant 
must be in a designated high impact 
sector (currently biomedical technology, financial services, silicon 
technology, and certain transportation 
equipment manufacturing).  Applicants must also create at least 100 new full-
time jobs in Florid a in a three-year 
period and make a cumulative investment of at least $100 million in 
the same time-frame.  For research and 
development facilities, the requirements are lower.  Seventy-five 
full-time jobs need to be created and 
there should be a cumulative capital investment of at least $75 million over 
a three year period. Section 288.108 (3)(b), Florida Statutes, provides 
guidelines on the amount of grant to be given to an 
eligible high impact business. Ongoing 
Florida  Qualified Defense 
Contractor Tax 
Refund Program Office of 
Tourism, Trade 
and Economic 
Development Tax Refund The Qualified Defense Contractor 
Tax Refund Program provides a tax 
refund of up to $5,000 per job 
created or saved in Florida through the conversion of defence jobs to 
civilian production, the acquisition 
of a new defence contract, or the consolidation of a defence contract 
which results in at least a 25 per 
cent increase in Florida employment, or a minimum of 
80 jobs. All- In order to qualify for 
consideration under the programme an 
applicant must:  pay an average annual 
wage that is at least 115 per cent of the state or local average wages; have in 
the last year derived at least 60 per cent 
of its Florida gross receipts from Department of Defense contracts and 
not less that 80 per cent over the 
preceding five years;  create at least a 25 per cent increase in Florida 
employment or 80 new jobs if a 
consolidation project;  show that the jobs make a significant economic 
contribution to the area economy;  
demonstrate that the tax refund is necessary for the business to compete 
for the new contract or make the 
consolidation;  and provide a resolution from the city or county 
commission recommending the 
applicant for the incentive. Once certified by the OTTED, the applicant may 
receive funds up to the project cap on the taxes it 
pays including corporate income, sales and excise, 
ad valorem, and documentary stamp taxes, subject to the following:  1) up to  25 per cent of the total 
refund may be taken per year as long as the 
business is maintaining project employment and 
wage levels, 2) up to $2. 5 million may be refunded 
to a single defence contractor in any year, 3) up to 
$7.5 million may be refunded to a single defence contractor in all years under the programme.  The 
local community provides a match equalling 20 per 
cent of the tax refund.  If located in a Rural Economic Development Initiative (REDI) county, 
the business may elect to be exempt from the local 
match and accept a refund equal to 80 per cent of the refund for which they would otherwise qualify. Ongoing  
  G/SCM/N/123/USA 
Page 76 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Florida  Quick Response 
Training Program Workforce 
Florida, Inc. Grant Quick Response's customer-driven 
training programmes provide rapid, 
effective training which is 
specifically tailored and designed to meet the needs of Florida business. Special consideration will be given to 
applicants located in a distressed urban 
or rural area or Enterprise Zone.  
Funding priority given to businesses creating high skill/high wage jobs, in 
qualified targeted industries·jobs 
located in a distressed Urban Inner City Area or Rural Area, jobs located 
in an Enterprise Zone or Brownfield 
Area, whose grant proposals have the greatest potential for economic impact, 
that contribute in-kind and cash 
matches. Once approved, a grant agreement is signed and 
the applicant is eligible for reimbursement of direct 
training costs;  i.e., instructors' salaries, curriculum 
development and manuals.  Payments are made monthly on a reimbursement and performance 
basis as per terms of the grant agreement.  The 
maximum grant term is 24 months. Ongoing 
Florida  Qualified Target 
Industry Tax Refund Program 
(QTI) Office of 
Tourism, Trade and Economic 
Development Tax Refund The Qualified Target Industry 
(QTI) Tax Refund Program is a tool available to Florida communities to 
encourage quality job growth in 
targeted high-wage businesses. Manufacturing facilities, Finance & 
Insurance Services, Wholesale Trade, Information Industries, Professional, 
Scientific & Technical Services, 
Corporate Headquarters and Management Services, Administrative & Support Services. Pre-approved applicants who create jobs in Florida 
receive tax refunds of $3, 000 per new job created;  
$6,000 in an Enterprise Zone or Rural County.  For 
businesses paying 150 per cent of the average 
annual wage, add $1,000 per job;  for businesses 
paying 200 per cent of the average annual salary, add $2,000 per job.  New or expanding businesses 
in selected targeted industries or corporate 
headquarters are eligible.  Tax refunds are only paid after verification of job creation/maintenance 
and required wage payments.  Local communities, 
except rural counties, must pay 20 per cent of the refund. Ongoing 
Florida  Rural Job Tax 
Credit Program Office of 
Tourism, Trade 
and Economic 
Development Tax Credit The Rural Job Tax Credit is a 
$1,000 tax credit per qualified 
employee to be taken against either 
the Florida Corporate Income Tax or the Florida Sales and Use Tax. Florida's 33 rural counties.  The list of 
eligible industries includes:  
Manufacturers, Printing and Publishing 
Firms, and Mining, Agriculture, Hotels, Customer Service Centers. New businesses must create at least 10 new jobs.  
Existing businesses must increase its employment 
base by 20 per cent, if the business has fewer than 
50 employees.  Existing businesses with 50 or more employees must create at least 10 new jobs.  
A total of $5 million of tax credits are available per 
calendar year. Ongoing 
Florida  Sales and Use Tax 
Exemption on 
Machinery and Equipment Florida 
Department of 
Revenue Tax 
Exemption The Sales and Use Tax Exemption 
on Machinery and Equipment is an 
incentive made available to new and expanding businesses who use 
such equipment at a fixed location 
to manufacture, process, compound, or produce tangible personal 
property for sale, or for exclusive 
use in spaceport activities.   Manufacturing machinery and 
equipment (MME) bought or used for 
manufacturing, compounding, or producing items of tangible personal 
property.   New manufacturing operations are fully exempt. 
Expanding businesses pay sales or use tax of 
$50,000 for each calendar year of the expansion project before the exemption or refund is available.  Ongoing  
   G/SCM/N/123/USA
 Page 77State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Florida  Sales Tax 
Exemption for 
Electrical Energy 
Used in an Enterprise Zone Florida 
Department of 
Revenue Tax 
Exemption Businesses located in an enterprise 
zone may receive 50 per cent 
exemption from the municipal 
utility tax, if the municipality has enacted an ordinance for the 
exemption of the utility taxes in an 
enterprise zone. In addition, businesses are exempted from 
50 per cent of the state sales tax on 
utilities.  If 20 per cent of the firm's employees are zone residents, the 
business is totally exempt from the 
tax. State-designated Enterprise Zones with 
local ordinance exempting 50 per cent 
of the municipal utility tax. These exemptions are available for up to five 
years. 31/12/2015 
Florida  Sales Tax Refund 
for Building Materials Used in 
an Enterprise 
Zone Florida 
Department of Revenue Tax Refund Businesses or homeowners located 
in an enterprise zone may receive a sales tax refund up to $5,000 
($10,000 if 20 per cent of 
employees are EZ residents) for sales taxes paid on building materials used to rehabilitate real 
property located in the zone. Enterprise Zones The maximum refund per application will be no 
more than $5,000 or 97 per cent of the tax paid.  If 20 per cent or more of the permanent, full-time 
employees of the business are residents of a 
Florida enterprise zone, the refund will be no more than the lesser of $10,000 or 97 per cent of the tax paid. 31/12/2015 
Florida  Sales Tax Refund 
for Business 
Machinery and Equipment Used 
in an Enterprise 
Zone Office of 
Tourism, Trade 
and Economic Development Tax Refund Businesses located in an enterprise 
zone may receive a sales tax refund 
on sales taxes paid to purchase new and used business property (e.g. 
tangible personal property such as 
office equipment, warehouse equipment, and some industrial 
machinery and equipment) which is 
used exclusively in  an enterprise 
zone for at least three years. State-designated Enterprise Zones The total amount of the sales tax refund must be at 
least $500, but no more than the lesser of $5,000 or 
97 per cent of the tax paid per parcel of property.  If 20 per cent or more of the permanent, full-time 
employees of the business are residents of a 
Florida enterprise zone the refund will be no more than the lesser of $10,000 or 97 per cent of the tax 
paid per parcel. 31/12/2015  
  G/SCM/N/123/USA 
Page 78 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Florida  Semiconductor, 
Defense, or Space 
Technology Sales 
and Use Tax Exemption 
(SDST) Office of 
Tourism, Trade 
and Economic 
Development Tax 
Exemption This is an exemption of sales and 
use taxes that would otherwise be 
paid by the semiconductor, defence 
or space technology business on machinery and equipment used in 
production and research and 
development. Semiconductor, Defense, or Space 
technology based facilities. Semiconductor Technology 
Industrial machinery and equipment used in 
semiconductor technology facilities to 
manufacture, process, compound, or produce semiconductor technology products for sale or for 
use by these facilities are exempt from 100 per cent 
of the tax imposed.  Machinery and equipment used predominately in semiconductor wafer 
research and development activities in a 
semiconductor technology research and development facility are al so fully exempt from the 
tax imposed. 
 Defence or Space Technology Industrial machinery 
and equipment used in defence or space technology 
facilities to manufacture, process, compound, or 
produce defence technol ogy products or space 
technology products for sale or for use by these 
facilities are exempt from 25 per cent of the tax imposed.  Machinery and equipment used 
predominately in defence or space research and 
development activities in a defence or space technology research and development facility are also exempt from 25 per cent of the tax imposed. Ongoing 
Florida  Rural Community 
Development 
Revolving Loan Office of 
Tourism, Trade 
and Economic 
Development Grant To promote rural development 
projects in rural areas which will 
stimulate economic growth. All businesses Low interest rates loans On going  
Florida  Florida's Centers 
for Excellence 
Technology Fund Office of 
Tourism, Trade 
and Economic 
Development Grant The three Centers:  Center of 
Excellence in Regenerative Health 
Biotechnology, Florida Phontonics 
Center of Excellence and Center of Excellence in Biomedical and 
Marine Biotechnology are designed 
to help bridge the gap between academia and industry and give 
university-produced innovations a 
push towards commercialization.  High-technology industries Each centre receives $10 million and businesses 
have access to R&D resources provided by the 
Universities, which is often too expensive for 
commercial industries. Ongoing  
Florida  Urban Job Tax 
Credit Office of 
Tourism, Trade and Economic Development Tax credit Encourages job creation in Florida's 
13 designated distressed urban core areas. List to include activities such as retail, 
manufacturers, customer service centres and hotels. Credit ranges from $500 to $2,000 per qualified 
job and can be taken against either corporate income tax or sales and use tax, but not both.  A total of $5 million in tax credits is available each 
calendar year.  On going  
Georgia Appalachian 
Region Business Development 
Revolving Loan 
Fund Department of 
Community Affairs Loans To attract businesses to the 
Appalachian region. Private, for profit businesses in the 
Appalachian region. $3m pool.  Loans equal $200,000 per qualifying 
business, or 50 per cent of total project cost. Ongoing  
   G/SCM/N/123/USA
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Georgia Enterprise Zone 
Program Georgia 
Department of 
Industry, Trade 
and Tourism Tax Credit State legislation was enacted in 
1983, pertaining to Atlanta only.  It 
was later extended to provide for 
statewide enterprise zone designations in 1997.  Companies 
locating within the zones receive 
100 per cent exemption on inventory for 25 years.  Legislation 
allows other communities to create 
"development districts" which are similar to Atlanta's Enterprise 
Zones. Businesses in areas of poverty, 
unemployment, and general distress.  
Zone areas can not be less than:  
Industrial-25 acres; commercial-8 acres; housing-5 acres. Industrial: Ad valorem tax reductions on property 
taxes on Freeport-eligible inventory for 25 years, 
with a 100 per cent property tax reduction in the 
first five years and 80, 60, 40, and 20 per cent reductions in subsequent five year periods; a 100 
per cent exemption exists for inventory for 25 
years.  Housing and Commercial:  Zone created for ten years with exemptions  for real property being 
100 per cent for 5 years;  80 per cent 6 and 7 years;  
60 per cent for 8 years;  40 per cent for 9 years;  20 per cent for 10 years.  Non-exempt real property is 
taxed by the City. Ongoing 
Georgia Foreign Trade 
Zones Georgia 
Department of 
Industry, Trade and Tourism Mixed Tax Three FTZs (and several sub-zones) 
provides tax advantages for 
companies importing foreign goods, which may be brought into zones 
without formal entry payment of 
duties, excise taxes, or payment of property taxes.  Inside the zones, 
goods may be processed, 
consolidated, assembled, repacked, exhibited, manipulated, re-labelled, 
used in manufacture, stored until 
needed, or shippe d back into the 
United States, at which time duties 
would be paid. Manufacturers, importers.  
Manufacturers using both domestic and 
foreign components. Not available. Ongoing 
Georgia Headquarters Tax 
Credit Georgia 
Department of 
Industry, Trade and Tourism Tax Credit Companies establishing their 
headquarters or relocating their 
headquarters to Georgia may be entitled to a tax credit if the criteria are met (See Rates, Terms, Limits). All The following criteria must be met to be eligible -- 
New jobs created at a new headquarters must be 
full-time (as defined by th e law and regulation) and 
must pay above the average wage for Tier 1 counties, at least 105 per cent of the average wage 
for Tier 2 counties, at least 110 per cent of the 
average wage of Tier 3 counties, and at least 115 per cent of the average wage for Tier 
4 counties.  Within one year, a company must 
invest $1 million and create 100 jobs at a new headquarters facility.  The company must elect not 
to take the job or investment tax credits.  The credit 
is equal to $2,500 annually per new full-time job or $5,000 if the average wage of the new full-time 
jobs is 200 per cent or more of the average wage of 
the county in which the new jobs are located.  The credits apply for five years beginning with the year 
in which jobs are placed in  service.  The credit may 
be taken against Georgia income tax liability and a company's withholding taxes.  Credits may be 
carried forward for 10 years.     
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Page 80 State Programme Title Programme 
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Georgia Investment Tax 
Credit Georgia 
Department of 
Industry, Trade 
and Tourism Tax Credit Part of Georgia's Business 
Expansion and Support Act of 1994 
which allows manufacturers and/or 
support facilities in operation for 3 years a tax credit. Counties (census tracts) ranked by 
unemployment rate, income, wage, and 
poverty level.  Eligible use can be 
investment, recycling, pollution control, and defence conversion 
activities.  All manufacturing and 
telecommunications companies are eligible to receive the tax credit. Based on the same tiers as the Job Tax Credit 
programme.  Allows a taxpayer that has operated 
an existing manufacturing or telecommunications 
facility or manufacturing or telecommunications 
support facility in the state for the previous five 
years to obtain a credit agai nst income tax liability.  
Companies expanding in Tier 1 counties must invest $50,000 to receive a 5 per cent credit.  That 
credit increases to 8 per cent for recycling, 
pollution control, and defence conversion activities.  Companies expanding in tier 2 counties 
must invest $50,000 to receive a 3 per cent tax 
credit.  That credit increases to 5 per cent for recycling, pollution control, and defence 
conversion activities.  Companies expanding in 
Tier 3 or Tier 4 counties must invest $50,000 to receive a 1 per cent credit.  That credit increases to 
3 per cent for recycling, pollution control, and 
defence conversion activities.   Ongoing 
Georgia Job Creation Tax 
Credit Georgia 
Department of 
Industry, Trade and Tourism Tax Credit Part of Georgia's Business 
Expansion and Support Act of 1994 
which allows statewide tax credits for businesses locating or 
expanding in the state.  Also, Job 
Tax Credit for Joint Development Authorities provides for an 
additional $500 job tax credit for a 
business locating within the jurisdiction of a joint authority of 
two or more contiguous counties. Counties (census tracts) are ranked 
according to the rate of unemployment, 
income, wages, and poverty level.  Industries include manufacturing, 
warehousing and distribution, 
processing, tourism, and research and development industries. The four Tiers are as follows:  Tier 1 counties that 
are ranked 1st through 71st represent the state's 
least developed counties. Companies creating 5 or more new jobs in a Tier 1 county may receive a 
$3,500 tax credit; Tier 2 counties are ranked 72nd 
through 106th.  Companies creating 10 or more jobs in a Tier 2 county may receive a $2,500 tax 
credit; Tier 3 counties are ranked 107th through 
141st.  Companies creating 15 or more new jobs in a Tier 3 county may receive a $1,250 tax credit; 
Tier 4 counties are ranked 142nd through 159th.  
Companies creating 25 or more new jobs in a Tier 4 county may receive a $750 tax credit.  Credits 
similar to the credit availa ble in Tier 1 counties are 
potentially available to companies in certain "less developed" census tracts in the metropolitan areas 
of the state.  At least 30 per cent of the new jobs 
created in these census tracts must be held by residents of the eligible census tracts or a Tier 1 
county.  Ongoing  
   G/SCM/N/123/USA
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Georgia Ports Activity Job 
Tax & Investment 
Tax Credit Georgia 
Department of 
Industry, Trade 
and Tourism Tax Credit Businesses or the headquarters of 
any such businesses engaged in 
manufacturing, warehousing and 
distribution, processing, telecommunications, tourism, or 
research and development that 
increase their port traffic tonnage through Georgia ports by more than 
10 per cent over their 1997 base 
year port traffic, or by more than 10 per cent over 75 net tons, five 
containers or 10 20- foot equivalent 
units (TEU's) during the previous 12 month period are qualified for 
increased job tax credits or 
investment tax credits.   Businesses or the headquarters of any 
such businesses engaged in 
manufacturing, warehousing and 
distribution, processing, telecommunications, tourism, or 
research and development that increase 
their port traffic tonnage through Georgia ports by more than 10 per cent 
over their 1997 base year port traffic, 
or by more than 10 per cent over 75 net tons, five containers or 10 20-foot 
equivalent units (TEU's) during the 
previous 12 month period are qualified for increased job tax credits or 
investment tax credits. Companies that increase th eir port traffic tonnage 
through Georgia ports by more than 10 per cent 
over the 1997 port traffic base year, or 75 net tons, 
five containers, or ten 20-foot equivalent units 
(TEU) during the previous 12-month period, and 
meet Business Expansion and Support Act criteria 
for the county in which they are located, are qualified for increased job tax credits or 
investments tax credits. Base year port traffic must 
be at least 75 net tons, five  containers or 10 TEUs.  
Companies that create 400 or more new jobs, 
invest $20 million or more in new and expanded 
facilities, and increase their port traffic by more than 20 per cent above their port traffic base year 
may take both job tax cred its and investment tax 
credits.  Job Tax Credits:  Companies may qualify for tax credits based on the tier level of the county 
in which they locate.   Ongoing 
Georgia Sales Tax 
Exemption Georgia 
Department of Industry, Trade 
and Tourism Tax 
Exemption A tax exemption for machinery 
replaced, upgraded, or incorporated into a manufacturing plant.  A sales 
and use tax exemption on purchases 
of primary material handling equipment.  A sales tax exemption 
for electricity purchased that 
interacts directly with a product being manufactured.  Tax 
exemption provided by Georgia law 
for new machinery and equipment. Other exemptions:  purchase for 
resale;  machinery used directly in 
making a product for sale; raw materials that will become a 
component of a finished product, 
i.e., paint on automobiles;  machinery and equipment used for 
pollution control. Manufacturing, remanufactures of 
aircraft engines, parts, and components, and government 
contractors for DOD or NASA. Not available. Ongoing  
  G/SCM/N/123/USA 
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Programme 
Hawaii Enterprise Zone 
Program Department of 
Business, 
Economic 
Development and Tourism Mixed Tax Businesses within a designated 
enterprise zone and qualifying 
under the Programme 
(manufacturing, wholesaling, maintenance or repair) are eligible 
for General Excise Tax exemptions 
and are eligible for two different types of income tax credits.  These 
include a seven-year exemption 
from general excise taxes on gross proceeds;  an 80 per cent first-year 
income tax abatement (decreasing 
10 per cent each year thereafter during the next six years), and an 
income tax credit equal to 80 per 
cent of unemployment taxes paid during the first year (decreasing 
10 per cent during the next six 
years).  Counties also contribute one or more incentives for each 
zone designated under its 
jurisdiction.  Each county designates areas as special enterprise zones, such as 
agricultural enterprise zones, to 
provide tax breaks, incentives, and other advantages to businesses in 
the area. Enterprise Zones- Qualifying 
businesses include manufacturing, 
wholesaling, aviation and maritime 
repair, telecommunications, medical research, data systems and 
international executive training. Not available. Ongoing 
Hawaii High Tech 
Business 
Investment Tax Credit Department of 
Taxation Tax Credit The high-technology business 
investment tax credit provides a 
non-refundable income tax credit to encourage Hawaii taxpayers to 
invest in "qualified high technology 
businesses (QHTBs)".  The tax credit is up to a maximum credit of 
$2 million per single-year's 
investment, per business, claimed over a 5-year period.  The credit can be taken against the income tax 
for tax years 2000 through 2005.  If 
the tax credit exceeds the taxpayer's liability, the excess of the tax credit 
may be carried over to subsequent 
years until exhausted. High technology businesses. (1) From 2001 to 2003, a QHTB can sell a 
maximum of $500,000 of its net operating loss per 
year for any net operating loss occurring in the two previous taxable years.  The sale price must be 
75 per cent or more of the tax benefit sold, and the 
amount received by the seller is not taxed as income.  (2) A maximum of $2 million per year per 
business non-refundable income tax credit with 
carryover in a qualified high technology business.  (3) Capital loss can be carried forward by a QHTB. Ongoing  
   G/SCM/N/123/USA
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Authority Form of 
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Programme 
Hawaii Motion Picture 
and Film 
Production 
Income Tax Credit Department of 
Business, 
Economic 
Development and Tourism Tax Credit Each taxpayer subject to Hawaii's 
net income tax, who incurs 
production costs and transient 
accommodations costs in Hawaii while producing a motion picture or 
television film that benefits 
Hawaii's economy, may claim a motion picture a nd film production 
income tax credit for the taxable 
year.   Motion picture and film industry. The tax credit is comprised of two parts: (1). An 
amount up to 4 per cent of the costs incurred in 
Hawaii in the production of motion picture or 
television films. (2). An amount up to 7.25 per cent of the costs incurred in Hawaii in the production of 
motion picture or tele vision films for actual 
expenditures for transient accommodations.  This tax credit is also refundable. Ongoing 
Hawaii Revolving 
Venture Capital 
Fund Hawaii Strategic 
Development 
Corporation Equity The Corporation invests public 
funds in professionally managed 
venture capital limited partnerships. High-technology and innovation 
businesses are given priority. Corporation has committed $14 million, pooled 
with private capital , into seven venture capital 
funds. Ongoing 
Hawaii Royalties Tax 
Exemption Department of 
Taxation Tax 
Exemption Effective 1 January 2000, amounts 
received by an individual or a qualified high technology business 
as royalties and other income 
derived from patents and copyrights owned by the individual or 
qualified high technology business, 
and developed and arising out of a qualified high technology business, will be exempt from income tax. High technology industry Royalties and other income derived from patents 
and copyrights owned by the individual or qualified high technology business, and developed 
and arising out of a qualified high technology 
business, will be exempted from income tax. Ongoing 
Hawaii Stock Options Tax 
Exemption Department of 
Taxation Tax 
Exemption All income received from stock 
options from a qualified high 
technology business by an 
employee that would otherwise be taxed as ordinary income or as 
capital gains is exempt from income 
tax.  "Qualified high technology business" refers to a business 
performing qualified research.  
"Qualified research" means (1) the same as in section 41 (d) of the 
Internal Revenue Code or (2) 
developing, design ing, modifying, 
programming, and licensing 
computer software.   High technology industry  All income received from stock options from a 
qualified high technology business is exempted 
from income tax. Ongoing 
Idaho $500 New Jobs 
Income Tax Credit Dept. of 
Revenue and 
Taxation Income Tax 
Credit New job creation Business that produce, assemble, 
fabricate, manufacture, or process 
natural resource products. $500 per new employee.  May not be combined 
with $1000 new job tax credit.   Ongoing 
Idaho Broadband 
Telecom Tax 
Credit Dept. of 
Revenue and 
Taxation Tax Credit Increase telecom investment into 
Idaho communities Any Business Up to $750,000 on Idaho State Income Tax for 
qualified broadband equipment.  Credit is 
transferable.   Ongoing  
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Programme 
Idaho Idaho Workforce 
Development 
Training Fund 
(WDTF) Department of 
Commerce & 
Department of 
Labor Grant The Workforce Development 
Training Fund (WDTF) was created 
to provide worker training for 
specific economic opportunities and industrial expansion initiatives;  
provide training to upgrade the 
skills of currently employed workers at risk of being 
permanently laid off;  and help 
communities attract and retain appropriate businesses.  Training 
may be provided by state technical 
colleges, colleges, other public or private training organizations, by 
the employer, and through 
partnerships among the above entities.  A statewide network of 
training providers is coordinated by 
the Division of Professional-Technical Education.  This network 
can deliver customized job training 
for new and expanding industries anywhere in the state and can provide uniform training 
simultaneously at multiple 
locations. Basic industries that sell products and 
services outside of Idaho, thereby 
bringing new revenue into the state and 
creating new jobs.  Non-basic industries that sell products and 
services in the local area recirculating 
existing revenues and are eligible only if a compelling economic benefit to the 
state can be shown. New guidelines adopted in 2001 provide a rural 
component that increases training funds from 
$2,000 to $3,000 per employee, eliminated the 
matching requirement and simplified the application process if the business is in a distressed 
rural county.  Idaho basic industries will be given 
priority over other industries.  Ongoing 
Idaho Rural Community 
Block Grant Dept. of 
Commerce & Labor Grant To finance and facilitate business 
development, expansion, or relocation and job creation. Any county or city except Entitlement 
Cities Up to $500,000 for public owned land, buildings, 
and infrastructure.   Ongoing 
Idaho Rural 
Rehabilitation 
Loan Program Idaho State 
Department of 
Agriculture Loans To offer financing and assistance 
for rural development. Individuals and organizations in Idaho 
whose agricultural projects provide 
rural development. Not available. Ongoing 
Idaho Sales Tax 
Production 
Exemption Dept. of 
Revenue and 
Taxation Tax Credit Increase investment in Idaho Any qualifying business 100 per cent Idaho Sales and use tax exemptions 
are available for equipment and materials used 
directly in manufacturing, processing, mining, 
fabrication, or logging operations; and for clean rooms used in semiconductor and semiconductor 
equipment manufacturing. Ongoing 
Illinois Capital Access 
Program Illinois 
Department of 
Commerce and Economic 
Opportunity Incentive to 
lenders Provides portfolio insurance to 
lenders. Higher match is available to lenders 
who provide financing to businesses 
located in a Federally designated Empowerment Zone or Enterprise 
Community (200 per cent match);  or 
minority-, women-, and disabled-owned companies. The lender sets the rate and terms for loans to 
businesses.  Reserve premiums range to 150 per 
cent of the bank's non-refundable fee of 3-7 per cent. Ongoing  
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Illinois Coal 
Demonstration 
Program Illinois 
Department of 
Commerce and 
Economic Opportunity Mixed 
Financing Finances state-of-the-art 
development and demonstration 
projects for advanced coal systems 
with utility and industrial applications.   Coal mining companies and electric 
power producers. Programme provides partial funding; nearly all 
demonstration projects have  leveraged other public 
or private funds.  Grants typically range from $1-
30 million. Ongoing 
Illinois Coal Development 
Program Illinois 
Department of 
Commerce and 
Economic Opportunity Grant Provides funds to advance 
promising new coal research 
technologies through the proof of 
concept stage to the commercial demonstration stage.  Includes 
technology maturation, technology 
transfer and related studies.   Companies employing clean coal 
technologies. 50/50 cost share. Ongoing 
Illinois Enterprise Zone 
Financing Program Department of 
Commerce and Community 
Affairs Loan Programme is designed to promote 
growth and development within the enterprise zone. Any for-profit entity  with less than 
500 employees locating in an Illinois Enterprise Zone. DCCA may participate in an eligible loan for no 
less than $10,000 and not more than $75,000.  In no case shall the amount of DCCA's subordinated 
participation exceed 25 per cent of the total project.  
DCCA's rate will be 200 basis points below the Wall Street Journal Prime rate, but in no event will 
the rate be less than 3 per cent. Ongoing 
Illinois Coal Infrastructure 
Program Illinois 
Department of 
Commerce and Economic 
Opportunity Grant Encourages communities and 
businesses to improve the coal 
extraction, preparation, and transportation systems in order to 
remedy barriers to the economic 
employment of coal. Coal mining companies, transportation 
companies, local communities. Grants typically range from $50,000 to $900,000. Ongoing 
Illinois Coal Revival 
Program Illinois 
Department of Commerce and 
Economic 
Opportunity Grant Provides incentives for the 
construction of base load coal-fired electricity generation plants. Electric power producers. Grants to be based on sales taxes paid on coal 
purchases up to a maximum of $100 million over 25 years. Ongoing 
Illinois High Impact 
Business Program Illinois 
Department of Commerce and 
Economic 
Opportunity Corporate 
Income and Sales Tax 
Credits Provides investment tax credits, 
sales tax exemptions for building materials and items consumed in a 
manufacturing or assembly process, 
and a utility tax exemption. To be designated a business must 
intend to invest $12 million and create 500 jobs or invest $30 million and 
retain 1,500 jobs. A high impact designation is made for 20 years, 
but the sales tax and utility tax exemptions are granted for five years with provision for renewal. Ongoing  
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the 
Programme 
Illinois Enterprise Zone 
Program Illinois 
Department of 
Commerce and 
Economic Opportunity Corporate 
Income and 
Sales Tax 
Credits Provides investment tax credits, a 
jobs tax credit, dividend deduction, 
interest income deduction to 
financial institutions, contribution deduction to a qualified zone 
organization, a sales tax exemption 
on building materials, utility tax exemptions, telecommunication 
excise tax exemptions, and sales tax 
exemptions for items consumed during a manufacturing or 
assembling process.  Local 
governments within a zone may abate local utility taxes and 
property taxes. Hired workers must be either 
dislocated or disadvantaged to qualify 
the employer for the jobs tax credit. Enterprise zones are designated by the state for a 
term of 30 years.  The sales tax or consumed items 
and utility and telecommunications excise tax 
exemptions are granted for five years with renewal 
provisions but cannot exceed termination date of 
zone. Ongoing 
Illinois Illinois Film 
Office Technical 
Assistance Illinois 
Department of 
Commerce and 
Economic Opportunity Business 
Assistance Provides technical assistance to 
film television and commercial 
production companies to encourage 
development of the film industry in Illinois.  Services include location 
scouting, pre-production and 
production coordination, liaison assistance, and information 
hotlines. Film industry N.A. -- in-kind assistance. Ongoing 
Illinois Film Wage Credit   Illinois 
Department of Revenue Corporate 
Income Tax Credit Provides corporate income tax 
incentive to motion picture, television, and production 
companies, based on wages paid, to 
promote filmmaking in Illinois. Film industry 25 per cent of wages paid to Illinois residents (non-
refundable). Ongoing 
Illinois Rail Freight 
Program Illinois 
Department of 
Transportation Mixed 
financing, 
mostly 
loans Provides loans and grants to 
communities and businesses to 
construct or improve rail facilities. Rail transportation companies, rail 
transportation customers, local 
communities. Terms of loans are negotiable, but the average rate 
is 3 per cent and the average repayment period is 
10 to 20 years.  Collateral is required. Ongoing 
Illinois Used Tire 
Recovery Program Illinois 
Department of Commerce and Economic 
Opportunity Mixed 
financing Provides grants and loans to 
projects that produce marketable materials from used tires and projects that use tire-derived 
materials in product manufacture or 
energy production. Manufacturing/processing and 
research/development projects. Grants and loans are available for 
manufacturing/processing projects up to $500,000, grants for procurement or demonstration projects and research/development up to $200,000, and 
grants for marketing up to $75,000. Ongoing 
Illinois Property Tax 
Incentives Illinois 
Department of 
Commerce and 
Economic Opportunity Tax 
exemptions
, 
abatements Only realty is subject to property 
taxes.  Taxing districts may abate 
partial abatements to commercial or 
industrial development  Enterprise zones may offer total property tax 
abatement. Enterprise zone abatement are limited 
to Illinois' 93 enterprise zones. Property tax abatement is limited to $4 million 
over 10 years, except in Illinois' 93 enterprise 
zones. Ongoing  
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Illinois Sales Tax 
Incentives Department of 
Commerce and 
Community 
Affairs Tax 
Exemption Sales tax exemptions are provided 
for farm machinery, farm 
chemicals, pollution controls, 
manufacturing machinery, replacement parts for 
manufacturing machinery, 
computers used to control manufacturing machinery,  and 
enterprise zone purchases.  
Purchasers of manufacturing machinery receive a credit equal to 
50 per cent of what the sales tax 
would have been if manufacturing machinery was taxed, making it 
possible for manufacturers to use 
these credits to offset any other sales tax liability they incur. The enterprise z one incentives are 
limited to Illinois' 93 enterprise zones. Credit equal to 50 per cent of what the sales tax 
would have been if manufacturing machinery was 
taxed. Ongoing 
Illinois Tax Increment 
Finance (TIF) Districts Illinois 
Department of Commerce and 
Community 
Affairs Loan Tax increment financing allows a 
community to use the increases in 
various local taxes that result from 
a redevelopment project to pay for 
costs involved in the project. Deteriorated areas with declining tax 
bases are targeted.  Both commercial and industrial sectors are eligible. TIF districts have a lifetime of 23 years. Ongoing 
Indiana Community 
Revitalization 
Enhancement 
Districts (CRED) Indiana 
Department of 
Commerce, 
Economic Development Tax Credit Provides tax credits to encourage 
business development in 
economically distressed areas of 
certain Indiana counties. The area must have an aggregate of at 
least 50,000 square feet of vacant floor 
space.  Significant obstacles to 
redevelopment must exist.  There must be significantly fewer employees in the 
area than there were 10 years earlier. The county's annual rate of unemployment must 
have been above the average statewide rate during 
at least three of the preceding five years; - the 
county's median income must either have declined over the preceding 10 years or grown at a lower 
rate than the statewide av erage during at least three 
of the preceding five years.  The population of the county must have declined over the preceding 10 
years; and certain other criteria (size of empty 
buildings, job loss and specified obstacles to redevelopment) must be met.    Amounts:  The tax credit is similar to, but more restrictive than, the 
Industrial Recovery Site Credit/Dinosaur Program.  
It is based on 25 per cent of the qualified investment. Ongoing  
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the 
Programme 
Indiana Venture Capital 
Investment Tax 
Credit Indiana 
Department of 
Commerce, 
Economic Development Tax Credit To encourage venture capital 
investments to be made in Indiana. Qualified businesses must meet the 
following criteria a) headquarters in 
Indiana b) primary focus on 
commercialization of research and development, technology transfers, or 
the application of new technology c) 
annual revenue of less than ten million in two years preceding the year in 
which the qualified investment is made 
c) has at least 50 per cent of its employees reside in Indiana d) is not 
engaged in real estate related business, 
insurance, accounting, medical or legal services, or oil or gas related 
exploration. The credit equals 20 per cent of the amount of the 
taxpayer's qualified investment capital. On going  
Indiana Enterprise Zone Indiana 
Department of 
Commerce, 
Community Development Tax Credits To improve the cash-flow position 
of business and improve its access 
to capital. Businesses who operate or will operate 
in the enterprise zone, lenders who 
make qualified loans within the 
enterprise zone and qualified employees of businesses within the 
enterprise zone.  Participating 
businesses must reinvest 100 per cent of their tax savings. Amounts vary. On going  
Indiana The TECH Fund Indiana 
Department of Commerce, Economic 
Development Grant To create and maintain jobs. Companies or non-profits who 
employee Indiana residents in advanced information technology jobs. Funds are available on a reimbursement basis.  Up 
to 50 per cent of eligible training costs.  Awards for training have the maximum of $50,000 or $2,500 per employee or whichever is less. On going  
Indiana Company-specific 
tax abatement Spencer County Tax 
Abatement The purpose of this programme was 
to aid in the construction of a new 
$285 million structural mill in Whitley County.  Spencer County 
tax abatements. Steel Dynamics.   Up to $59 million in tax abatements. 10 years. 
Indiana  Loan Guaranty 
Program Indiana 
Development 
Finance Authority Guarantee Must create or retain Indiana jobs. Loan guarantees are available to 
finance land acquisition;  building 
acquisition or improvements;  structures;  machinery;  equipment;  
facilities;  and some working capital.  
Eligible firms are high-tech/high-growth companies, agribusiness and 
some manufacturing companies.   If security is real property, guaranty up to 90 per 
cent of loan balance or 90 per cent of appraised fair 
market value, whichever is less.  If security is personal property, guaranty up to 75 per cent of 
loan balance or 75 per cent of fair market value, 
which ever is less.  Limited working-capital 
guarantees available for high-tech companies.  
Amounts vary.  For rural development and value-
added agricultural projects, the maximum guaranty is $300,000.  The guaranty may be larger for high-
growth/high-tech companies and manufacturing 
projects. Ongoing  
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Programme 
Indiana  Company-specific 
start-up incentives DeKalb County Tax 
Credits/ 
Bonds The purpose of this programme was 
to assist in the start-up of a new 
$370 million minimill in Butler, 
Indiana.  This subsidy took the form of tax credits, tax abatement, bonds, 
and county economic development 
income tax revenues applied toward project (November 1995).  On 
going tax incentives programmes 
previously notified. Steel Dynamics.   DeKalb County tax incentives of $77.84 million;  
DeKalb County bonds of $11.1 million;  DeKalb 
County bonds to be repaid by property taxes of 
$5.6 million;  DeKalb County grant from economic development income tax revenue of $12.5 million.  
The total is $107.4 million. 10 years. 
Indiana  Community 
Revitalization Enhancement 
Districts (CRED) 
Tax Credit Indiana 
Department of Commerce Tax Credit To encourage revitalization 
investments in designated CRED areas. All businesses.   Up to 25 per cent of the qualified investment. On going  
Indiana  The Tech Fund IDOC Grant Training activities eligible for 
reimbursement must result in a full-time employee receiving a portable certification in systems 
administration, systems engineering 
or software development;  a professional certification or other 
advanced e-business enabling 
applications. Indiana companies or non-profit 
corporations that employ Indiana residents (US citizens only) in advanced information technology 
occupations.  Non-resident, contractual 
or part-time employees are not eligible.  Companies must have been in 
operation for at least one year prior to 
the application date and be in good standing with the State of Indiana. Funds are available on a reimbursement basis.  The 
business must submit quarterly reports on the status of the employees' training.  Amounts:  up to 50 per cent of eligible training costs.  Awards for 
training have a maximum of $50,000.  30 or fewer 
employees - up to 50 per cent of eligible training costs;  30 to 100 - up to 40 per cent eligible 
training costs;  100 to 200 - up to 30 per cent 
eligible training costs;  200 and up - to 10 per cent of eligible training costs. Ongoing 
Iowa Enterprise Zones Department of 
Economic 
Development Mixed Tax Twenty eight counties and 18 cities 
may establish enterprise zones for 
manufacturers and other businesses expanding or establishing new 
operations.   Businesses located in economically 
distressed areas of Iowa.  To receive 
the benefits, businesses must invest at least $500,000, hire at least 10 persons 
at target wage and benefit levels, and 
not be retail establishments. The enterprise zones provide the following benefits 
for qualifying businesses: 
1) Property tax exemptions for up to 10 years. 2) Investment Tax Credit for up to 10 per cent on 
corporate income taxes. 
3) Refunds of sales or use taxes paid to contractors during construction. 
4) A 13 per cent research and development 
activities credits on corporate income taxes. 5) Additional withholding tax credit of 1.5 per cent 
(total 3 per cent for the business' job training 
programme). Ongoing 
Iowa Entrepreneurial 
Ventures 
Assistance Program (EVA) Department of 
Economic 
Development Loan The Entrepreneurial Ventures 
Assistance Program (EVA) 
provides up to $20,000 in financial assistance funds and up to $5,000 in 
technical assistance funds for a 
business in a sector of the Iowa economy with the greatest start-up 
and growth potential for Iowa. Biotechnology;  recyclable materials;  
software development and computer 
related products;  advanced materials;  advanced manufacturing; medical and 
surgical instruments. Up to $50,000 may be awarded to a single 
applicant in the form of  financial assistance.  
Repayment of the funds may be in the form of a royalty investment or low interest loan, which is 
determined upon approval.  Up to $10,000 may be 
awarded to a single applicant in the form of technical assistance.  Technical assistance funds 
will be considered a grant and do not require 
repayment.   Ongoing  
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Iowa Company-specific 
grant and tax 
incentives State of Iowa Tax 
incentives. The incentives were provided by 
the State of Iowa to Ipsco for the 
construction of a new plate mill, 
which cost $360 million. Ipsco.   Fixed amount of $73 million.  Of this amount, 
$3 million was in the form of a state grant and 
$70 million is in the form of tax incentives. 20 years 
Kansas Sales Tax 
Exemptions Department of 
Commerce & 
Housing Tax 
Exemption Electricity, gas, and water 
consumed during manufacturing is 
exempt from the Kansas sales tax.  
Sales tax paid on the purchase of machinery, equipment and certain 
other tangible property may be 
exempted if the applicant's business qualifies for Job and Investment Tax Credits and is located within a 
state designated Enterprise Zone.  
Companies that qualify for the High Performance Business Incentive 
Programme are eligible to receive 
this exemption without being tied to the job creation requirement.  This 
exemption extends to 
manufacturing machinery and equipment as well as to any quality 
control and pollution control 
equipment installed.  All sales of manufacturing machinery and 
equipment are exempt from sales 
taxes.  This exemption extends to machinery and equipment 
purchased primarily for use in the 
assembly, processing, finishing, storing, warehousing, or 
distribution of tangible personal 
property intended for resale. Statewide.   Not available. Ongoing  
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Kansas  Enterprise Zone Department of 
Commerce & 
Housing Mixed Tax The Enterprise Zone Act provides 
state income tax credits and state 
and local sales tax exemptions on a 
state-wide basis.  This programme is not based on locating in a specific 
geographic location, except in 
certain cases.  The types and amounts of credits and exemptions 
are dependent upon 1) type of 
business (manufacturing, distribution, certain service and 
other designated business 
operations);  2) the number of net new jobs and capital investment.  
Non-metropolitan counties can 
offer increased job credits by meeting certain programme 
requirements.  The sales tax 
exemption is available to retail businesses in cities under 
2,500 population or counties under 
10,000 population. Statewide, except for 1) certain non-
metropolitan counties that can qualify 
for enhanced job credits by meeting 
certain requirements;  2) All businesses, including retail, locating in 
cities under 2,500 population or 
counties under 10,000 population that can qualify for a sales tax exemption. The incentives are:  (1) Sales tax exemption on the 
purchase of machinery, equipment, or services 
associated with any construction, expansion, or 
renovation project that creates net new jobs;  (2) Job creation tax credit ($1,500 basic, $2,500 
enhanced) against state income tax liability for 
each net new job created;  and (3) Investment tax credit ($1,000) against state income tax liability for 
each $100,000 or major portion thereof.  This is a 
one-time credit with unlimited carry-forward provisions.  The maximum credit in any given year 
is 100 per cent of the tax liability in qualified 
business facility investment. Ongoing 
Kentucky Coal Income Tax 
Credit Kentucky 
Revenue Cabinet Tax Credit A credit is allowed for up to 4.5 per 
cent of the purchase price of coal 
(excluding transportation costs) used for industrial heating or 
processing. For purposes of the Coal Income Tax 
Credit, "qualifying coal" is coal that is 
subject to the Coal Severance tax, which is levied on every taxpayer in 
Kentucky engaged in processing coal. The credit is allowed for 10 years following either 
the installation or conversion to coal burning units.  
The credit in any y ear cannot exceed the 
corporation's tax liability, minus other credits.  
Unused credits cannot be carried forward. Ongoing  
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Kentucky Enterprise Zone Kentucky 
Economic 
Development 
Cabinet, Department of 
Financial 
Incentives Tax Credit State and local tax incentives are 
offered to businesses located or 
locating in zones, and some 
regulations are eased to make development in the area more 
attractive.  A zone remains in effect 
for 20 years after the date of designation. To qualify, businesses must meet the 
following criteria:  50 per cent of their 
employees must perform substantially 
all of their serv ices within the 
enterprise zone and must be able to 
apply as a new business (companies 
which began operations in the enterprise zone after the date the zone 
was designated);  and 25 per cent of 
the company's total full-time workforce must meet the targeted 
criteria as long as the business is 
enterprise zone certified.  To apply as an existing business (companies which 
were in operation in the enterprise zone 
prior to the designation of the zone) the company has the option of (a) making 
a 20 per cent increase in capital 
investment, or (b) increasing the total workforce 20 per cent with 25 per cent 
of the new employees meeting the 
targeted workforce cr iteria.  Targeted 
workforce criteria are Kentucky residents who (a) reside within the 
enterprise zone, or (b) were 
unemployed 90 days prior to being hired by the enterprise zone business, 
or (c) were receiving public assistance 
benefits for at least 90 days prior to employment with a qualified business. Not available. All enterprise 
zones expire 
by Dec. 31, 
2007 
Kentucky High-tech 
construction & 
high-tech 
investment pools Kentucky 
Cabinet for 
Economic 
Development Loan The Office of the Commissioner for 
Commercialization and Innovation, 
in the Cabinet for Economic 
Development, shall administer two pools of funds:  (1) The high-tech 
construction pool shall be used for 
projects with special emphasis on the creation of high-tech jobs and knowledge-based companies;  
and 2.  The high-tech investment 
pool shall be used to build and promote networks for technology-
driven industries and research-
intensive industries with the goal of creating clusters of innovation-
driven industries in Kentucky. Technology-driven, research-intensive, 
and knowledge-based companies, 
clusters, or networks. Not available. Ongoing  
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Kentucky Kentucky Rural 
Economic 
Development Act 
(KREDA) Kentucky 
Economic 
Development 
Cabinet, Department of 
Financial 
Incentives Tax Credit Companies with projects approved 
under KREDA receive state income 
tax credits and job assessment fees. Projects must create new jobs in 
economically distressed counties.  
Manufacturing industries are the 
primary target of this programme. Companies with projects approved under KREDA 
may potentially receive state income tax credits 
and job assessment fees for up to 100 per cent of 
annual debt service costs for up to 15 years on land, buildings, site development, building fixtures 
and equipment used in a project.  Total benefits 
can approach one year's gross wages per job.  The company may collect a job assessment fee of 4 per 
cent of the gross wages of each employee whose 
job is created by the approved project and who is subject to Kentucky income taxes.  The employee 
receives credits for the fee against state income 
taxes. Ongoing 
Kentucky Kentucky Equal 
Opportunity Zone Kentucky 
Cabinet for Economic 
Development Tax Credit A qualified zone consists of one to 
five contiguous census tracts located entirely within a county, 
urban county government, or city of 
the first class.  KREDA-certified counties are exempt from census tract criteria and may have the 
entire county certified as a zone.  
Only one qualified zone is allowed per county.  Eligible companies 
include new or expanded 
manufacturing, service, or technology industries, which must 
invest at least $100,000 in the 
project and create at least ten new full-time jobs for residents of the 
zone.  An approved company may 
receive up to one hundred per cent credit against Kentucky income tax 
liability on taxable income 
generated by the project.  The company may carry forward credits 
during the agreement term, which 
shall be ten years.   The Kentucky Economic Opportunity 
Zone Act (KEOZ) focuses on development of areas with high 
unemployment and poverty levels. Not available. Ongoing  
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Kentucky Kentucky 
Industrial 
Development Act 
(KIDA) Kentucky 
Economic 
Development 
Cabinet, Department of 
Financial 
Incentives Tax Credit Investments in new and expanding 
manufacturing projects may qualify 
for tax credits.  Companies that 
create at least 15 new full-time jobs and invest at least $100,000 in 
projects approved under KIDA may 
receive state income tax credits for up to 100 per cent of annual debt 
service costs (principal and interest) 
for up to 10 years on land, buildings, site development, 
building fixtures and equipment 
used in a project, or the company may collect a job assessment fee of 
3 per cent of the gross wages of 
each employee whose job is created by the approved project and who is 
subject to Kentucky income taxes. All new and expanding manufacturing 
projects are eligible for KIDA. Financing may be provided by any source, 
typically banks or industrial revenue bonds, except 
debt service paid in connection with other state 
grant programmes.  Unused credits may be carried forward for the term of the agreement. Ongoing 
Kentucky Kentucky Rural 
Economic 
Development Act 
(KREDA) Kentucky 
Economic 
Development 
Cabinet, Department of 
Financial 
Incentives Tax Credit Companies with projects approved 
under KREDA receive state income 
tax credits and job assessment fees. Projects must create new jobs in 
counties with unemployment rates 
above the state aver age in each of the 
preceding 5 years.  Manufacturing industries are the primary target of this 
programme. Companies with projects approved under KREDA 
may potentially receive state income tax credits 
and job assessment fees for up to 100 per cent of 
annual debt service costs for up to 15 years on land, buildings, site development, building fixtures 
and equipment used in a project.  Total benefits 
can approach one year's gross wages per job.  The company may collect a job assessment fee of 4 per 
cent of the gross wages of each employee whose 
job is created by the approved project and who is subject to Kentucky income taxes.  The employee 
receives credits for the fee against state income 
taxes. Ongoing  
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Kentucky Local Government 
Economic 
Development 
Fund Kentucky 
Cabinet for 
Economic 
Development Grant The programme is funded through 
an allocation of coal severance tax 
receipts.  Grants are provided to 
eligible coal producing counties to assist in diversifying local 
economies beyond a dependence on 
coal.  The Regional Business Park Programme is funded under the 
LGEDF programme and designed 
to develop large blocks of available, accessible, and marketable land as 
regional business parks. The 
participating counties share in the tax revenues, and all other proceeds 
generated from the project, through 
interlocal agreements between the participating counties and the 
formation of regional authorities.  
These legally established authorities own, maintain, and market the 
available acreage with guidance 
from the Cabinet for Economic Development.  Workforce training costs under the Job Training Fund 
are available to companies locating 
in a coal county or one of the Regional Business Parks that hire 
residents from participating 
counties.  The company must meet eligibility criteria under the LGEDF 
Programme and one of the KEDFA 
administered tax credit programmes, id est, KREDA, 
KJDA, KEOZ, or KIDA.   Coal producing counties. Not available. Ongoing 
Louisiana Biomedical 
Research and 
Development Park (NORMC) Incentives Department of 
Economic 
Development Mixed Tax Qualified medical concerns may be 
granted exemptions for state 
corporation income and franchise taxes.  The total amount of state tax rebates and/or exemptions granted 
for any fiscal year shall not exceed 
thirty (30) per cent of the corporate income, franchise and state 
sales/use tax liability of the medical 
concern during the fiscal year preceding the fiscal year for which 
the exemptions are granted, unless 
another amount is established by contract. 
Qualified medical concerns may 
also be granted tax credits against New Orleans Regional Medical Center.  Annual tax exemptions, reba tes and/or credits are 
subject to the following limitations:  The total 
amount of state tax exem ptions and/or rebates 
granted for any fiscal year  shall not exceed thirty 
per cent of the corporate income, franchise, and 
state sales/use tax liability of the medical concern 
during the fiscal year preceding the fiscal year for which the exemptions and/or rebates are granted, 
unless another amount is es tablished by contract.  
The total amount of rebates of local sales/use taxes granted for any fiscal year shall not exceed one 
hundred per cent of the local sales/use taxes 
liability due to that authority from the medical concern during the fiscal year preceding the fiscal 
year for which the rebates are granted, unless 
another amount is esta blished by contract. Ongoing  
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state corporate income and franchise tax liabilities.  Such 
credits, which may be carried 
forward up to five years, shall not exceed the cost of purchase by the 
concern of machinery and scientific 
equipment used on premises of a medical concern located in the park 
district, which is the area known as 
the New Orleans Regional Medical Center (NORMC). 
Louisiana Biotechnology 
Tax Credit Louisiana 
Department of 
Economic 
Development Tax Credit Excludes biotechnology companies 
from paying state or local sales and 
use taxes on capital expenditures 
for new research equipment. Biotechnology Companies.   Not available. Ongoing 
Louisiana Customized 
Computer 
Software Development Tax 
Credit Louisiana 
Department of 
Economic Development Tax Credit Phases in a state sales and use tax 
exclusion for certain custom 
computer software over a four-year period.   Technology Companies.   The current 4 per cent sales tax rate will decrease 
1 per cent per year until it reaches 0 per cent 
on 7.1.2005. Ongoing 
Louisiana Economic 
Development 
Award Program Department of 
Economic 
Development Grant Grant awards to public or quasi-
public state entities and local 
governments to finance publicly-owned infrastructure for industrial 
or business development projects. Preference will be given to projects 
located in areas of the state with high 
unemployment levels and to projects intended to expand, improve or provide 
basic infrastructure supporting mixed 
use by the company and the surrounding community.  No 
assistance may be provided for 
Louisiana companies relocating their operations to another labour market 
area (as defined by the US Census 
Bureau) within Loui siana, except when 
company gives sufficient evidence that 
it is otherwise likely to relocate out of 
Louisiana.   The minimum award request size shall be $25,000.  
Projects must create or retain at least 10 permanent 
jobs in Louisiana.  The portion of the total project cost financed by the award may not exceed 90 per 
cent for projects located in parishes with per 
capital income below the median for all parishes;  75 per cent for projects in parishes with 
unemployment rates above the statewide average;  
or 50 per cent for all other projects. Ongoing  
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Louisiana Enterprise Zone 
Program Department of 
Economic 
Development Tax Credit The programme provides one-time 
tax credit of $2,500 for each net 
new permanent job created for 
businesses that locate or expand in designated enterprise zones.  
Credits may be applied against a 
company's Louisiana state income or corporation franchise tax 
liability.  As of 2002, the Enterprise 
Zone Program offers double the usual $2,500 tax credits to certain 
manufacturers, giving them 
$5,000 per job.  The Enterprise Zone Program also provides rebates 
on applicable state and local 
sales/use taxes (except where local sales taxes are encumbered toward 
payment of bond indebtedness or 
are school taxes), on purchases of building construction materials, 
machinery, and equipment by 
businesses that build or renovate facilities in Louisiana Enterprise Zones. There are 1,670 enterprise zones 
statewide, in both urban and rural 
parishes.  Job credits are $5,000 for 
SIC Code Numbers 3721, 3724, 3728, 3761, 3764, and 3769. Sales tax benefits (rebates) are only in effect for 
the duration of the initial construction period 
(2 year maximum). Ongoing 
Louisiana Film & Video 
Investor Tax 
Credit Louisiana 
Department of 
Economic 
Development Tax Credit To attract business to Louisiana. Film/Video Industry.   Lowers from $1 million to $250,000 the amount a 
movie or TV company must spend to qualify for an 
exemption from the state sales tax. Ongoing 
Louisiana Film & Video 
Jobs Tax Credit Louisiana 
Department of 
Economic 
Development Tax Credit To attract business to Louisiana. Film/Video Industry.   Gives film producers with a $300,000 Louisiana 
payroll a 10 per cent tax credit on that payroll.  If 
the payroll is $1 million or more, the credit is 
20 per cent. Ongoing 
Louisiana Film & Video 
Sales & Use Tax Exemption Louisiana 
Department of Economic Development Tax 
Exemption To attract business to Louisiana. Film/Video Industry.   Allows LA residents who invest $300,000 in a 
movie or TV production a 10 per cent tax credit on that investment.  The credit is 15 per cent if the investment is $1 million or more.   Ongoing 
Louisiana Film and Video 
Sales/Use Tax 
Refund Program Department of 
Economic 
Development Tax Refund To attract business to Louisiana. Film/Video Industry.   Rebates all of Louisiana state sales/use taxes paid 
out by motion picture production companies that 
film in the state and pay sales/use taxes on a 
minimum of $1 million of annual purchases in the state. Ongoing  
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Louisiana Restoration Tax 
Abatement Department of 
Economic 
Development Tax 
Abatement 
or 
Reduction The Restoration Tax Abatement 
Programme was created for 
municipalities and local 
governments to offer as an incentive to encourage the 
expansion, restoration, 
improvement and development of existing commercial structures and 
owner-occupied residences in 
Downtown Development Districts, Economic Development Districts, 
or Historic Districts. Buildings must be located in a 
Downtown Developm ent District, an 
Historic District, an Economic 
Development District or be listed on the National Register for Historic 
Places. Property taxes may be abated on the amount of 
improvements to existing structures, for a five year 
period and may be renewed for an additional five 
years. Ongoing 
Louisiana University 
Research and 
Development Parks Income and 
Franchise Tax 
Exemptions and Credits Department of 
Economic 
Development Mixed Tax Firms located in university research 
and development parks may be 
granted exemptions for state corporation income and franchise 
taxes.  Firms located in university 
research and development parks may be granted tax credits against state corporate income and 
franchise tax liabilities.  Such 
credits, which may be carried forward up to five years, shall not 
exceed the cost of purchase by the 
concern of machinery and scientific equipment used on the firm's 
premises. University research and development 
parks. The total amount of state tax rebates and/or 
exemptions granted for any fiscal year shall not 
exceed thirty per cent of  the corporate income, 
franchise and state sales/use tax liability of the firm 
during the fiscal year preceding the fiscal year for 
which the exemptions are granted, unless another amount is established by contract.  Ongoing 
Louisiana University 
Research and 
Development 
Parks Sales and Use Tax Rebates Department of 
Economic 
Development Tax Refund Qualified firms located in 
University Research and 
Developments Parks may be 
granted rebates for state and/or local sales/use taxes on machinery 
and equipment to be used by the 
applicant, on materials and building supplies to be used in the repair, 
reconstruction, modification, or 
construction of facilities and on materials and supplies necessary for 
or used in the production of the 
applicant's production of the applicant's product.  Additionally, 
sales/use tax rebates may be granted 
on any other goods and services used or consumed by the applicant. University research and development 
parks. Annual tax exemptions, reba tes and/or credits are 
subject to the following limitations:  The total 
amount of state tax exem ptions and/or rebates 
granted for any fiscal year  shall not exceed thirty 
per cent of the corporate income, franchise, and 
state sales/use tax liability of the medical concern 
during the fiscal year preceding the fiscal year for which the exemptions and/or rebates are granted, 
unless another amount is es tablished by contract. 
The total amount of rebates of local sales/use taxes granted for any fiscal year shall not exceed one 
hundred per cent of the local sales/use taxes 
liability due to that authority from the medical concern during the fiscal year preceding the fiscal 
year for which the rebates are granted, unless 
another amount is esta blished by contract. Ongoing  
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Louisiana Workforce 
Development and 
Training Program Department of 
Economic 
Development Grant Funding for eligible training 
activities includes:  (1) New 
Employee Training:  This sub-
programme provides training assistance for companies seeking 
prospective employees who possess 
sufficient skills to  perform the jobs 
to be created by the companies;  (2) 
Workplace-Based Retraining:  This 
sub-programme provides training assistance for companies seeking to 
upgrade the skills of existing 
employees in response to technological advances or improved 
production processes, or the need to 
ensure compliance with accepted international and industrial quality 
standards (e.g. ISO standards, 
proprietary technology). Preference will be given to applicants 
in industries identified by the state as 
target industries, and to applicants 
located in areas of the state with high unemployment levels. The New Employee Training award may cover up 
to 100 per cent of the eligible training costs, not to 
exceed $500,000.  The Workplace-based 
Retraining award may cover up to 50 per cent of the eligible training costs, not to exceed $500,000.  
Funds are available on a reimbursement basis 
following submission of approved invoices to 
DED. Ongoing 
Maine Jobs and 
Investment Tax 
Credit Maine Revenue 
Services Tax Credit This programme provides a 10 per 
cent credit against Maine income 
taxes for investment in most types of personal property that generates 
at least 100 new jobs within two 
years of the date the investment is placed in service, as long as the 
investment is at least $5 million for 
the taxable year. Statewide.  This tax credit is available 
to any business (oth er than regulated 
utilities) making a personal property investment of at least $5 million and 
creating at least 100 qualifying jobs, 
regardless of industry sector, location, market, raw materials source or 
product content.   The amount of the credit is tied to the federal 
investment tax credit and is limited to $500,000 per 
year with carry forwards available for seven years.  Thus, the credit can be up to $3.5 million, based 
upon taxable income.  Businesses are prohibited 
from receiving the Maine Jobs and Investment Tax Credit and Employment Tax Increment Financing 
concurrently. Ongoing 
Maine Tax Increment 
Financing (TIF) 
District Department of 
Economic and 
Community Development Loan A Tax Increment Financing (TIF) 
District is an area within a 
municipality that is designated as a development district to allow the 
municipality to financially support 
a business development programme using the revenue stream of new 
property taxes that will result from 
improvements made to the property.  When forming a TIF district, a community may either fund a 
portion of the necessary 
improvements or return a percentage of the incremental tax 
revenue to the company to help 
offset project costs. The maximum term for a TIF district is 
30 years, except in instances where the 
municipality issues bonds to finance a project, in which case the maximum 
term is 20 years. Not available. Ongoing  
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Maine  Pine Tree 
Development 
Zones Department of 
Economic and 
Community 
Development Tax Free 
Zone Maine offers qualified businesses in 
manufacturing, financial services, 
and targeted technology sectors 
significant tax advantages for locating in one of Maine's newly 
designated Pine Tree Zones.  
Detailed information is available online at 
http://www.mainebiz.org/why_mai
ne/pine_tree_zones.asp. Certified businesses which locate in a 
Pine Tree Development Zones 
(PTDZ). Certified businesses which locate in a PTDZ may 
be eligible for the following:  1) 100 per cent 
Corporate Income Tax Credit for 5 years and 
50 per cent credit for the second 5 years,  2) 80 per cent reimbursement of its employees' state personal 
income tax withholdings, 3) 100 per cent sales tax 
exemption on purchases of qualified building materials and personal property, 4) access to other 
state and local incentive programmes.   Until 2018 
Maine High Technology 
Investment Tax Credit Department of 
Economic and Community 
Development Tax 
Incentives Tax credit for businesses engaged 
in high-tech activities. Business primarily engaged in high-
tech activities;  high-tech activities include the design, creation, and 
production of computer software, 
computer equipment, supporting communications components and other 
accessories that are directly associated 
with computer software equipment;  it also includes the provision of Internet or advanced telecommunications 
services. The credit amount is equal to the adjusted basis of 
eligible equipment placed in service in Maine less 
any lease payments received during the taxable 
year;  the credit cannot reduce the tax liability to 
less than the preceding tax year's liability after the 
allowance of any credits, and it cannot reduce the 
tax liability in the current year below zero;  unused 
portions of the credit may be carried forward five years;  the credit cannot exceed $100,000 in any one year;  income must be increased by any credit 
base amount claimed as a business expense.  This 
credit cannot be used in tandem with the Business Equipment Tax Reimbursement. Ongoing 
Maine Sales Tax 
Exemptions - 
Biotechnology Department of 
Economic and 
Community 
Development Tax 
Incentives Sales of machinery, equipment, 
instruments and supplies used by 
the purchaser directly and primarily 
in a biotechnology application are eligible for a sales tax exemption.   Businesses engaged in a biotechnology 
application. Not available. Ongoing 
Maine Maine Technology 
Institute Maine 
Technology 
Institute Grants Maine Technology Institute (MTI) 
will provide research & 
development money to companies 
and non-profit research organizations in the State of Maine 
to support the commercialization of 
new technology-related products and services that will create and 
support sustainable, high-quality 
jobs for Maine people.  Awards are made on a competitive 
basis and support efforts in any of the 
state's seven targeted technology areas:  
Advanced Technologies for Forestry and Agriculture, Aquaculture and 
Marine Technology, Biotechnology, 
Composite Materials Technology, Environmental Technology, 
Information Technology, and Precision 
Manufacturing Technology. All MTI programmes require a 1:1 cash match, and 
are awarded based on scientif ic or technical merit, 
commercial feasibility, and potential for economic 
impact to the State.  MTI offers three awards programmes.  These awards are considered on an 
on-going basis:  
1) Development Awards are competitive awards of up to $500,000 per project and are awarded twice a 
year;  
2) Seed Grants, awarded four times per year, are competitive grants of up to $10,000 per project to support very early activities for product 
development, commercialization, or business 
planning and development;  3) Cluster Enhancement Awards are competitive 
grants for up to $100,000 for collaborative projects 
that will stimulate and support the formation and growth of technology businesses and their 
infrastructure.  Ongoing  
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Authority Form of 
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the 
Programme 
Maryland  Maryland Small 
Business 
Development 
Financing Authority 
(MSBDFA) Department of 
Business and 
Economic 
Development Mixed 
Financing Authorized by Article 83-A 
sections 5-1001 through 5-1048 Provides financing for small businesses 
and those owned by socially and 
economically disadvantaged persons. • Contract Financing Programme - loan guarantees 
and direct working capital and equipment loans to 
socially or economically disadvantaged businesses 
that have been awarded c ontracts mainly funded by 
government agencies and/or public utilities.  
• Equity Participation Investment Programme - 
direct loans, equity investments and loan guarantees to socially or economically 
disadvantaged-owned businesses in franchising, in 
technology-based industries, and for the acquisition of profitable businesses.  
• Long-Term Guaranty Programme - provides loan 
guarantees and interest rate subsidies.  • Surety Bonding Programme - assists small 
contractors in obtaining bonding for primarily 
funded government or public utility contracts that require bid, performance, and payment bonds.  Ongoing 
Maryland  Challenge 
Investment 
Program Maryland 
Department of 
Business and Economic 
Development Equity This programme provides financing 
for seed-stage companies to cover a 
portion of the initial costs associated with bringing new 
products to market. Financing is available for technology 
companies.  Requirements include: 
• The business must have no more than 25 employees and annual sales of less 
than $1 million.              
• A minimum 1:1 co-investor match is required.  
• Applicants are limited to high tech 
companies whose principal place of business is located in Maryland.  
• The company must remain in 
Maryland for at least three years.  This programme provides financing for seed-stage 
companies to cover a portion of the initial costs 
associated with bringing new products to market.  Initial investments are made up to $50,000, with 
incremental investments to a maximum of 
$150,000.  These incremental investments are awarded based upon the clie nt's performance and 
the client's ability to achieve milestones set by the 
Investment Financing Group st aff at the time of the 
initial closing.  Investme nt decisions are based on 
the project's potential return on investment, market 
potential, experience a nd credibility of the 
management team, and impact on the Maryland 
economy.  Investment decisions are also based on 
the strength of the technology (e.g., patents, highly proprietary developments preferred).  Companies 
receiving a Challenge investment must pay a 2 per 
cent royalty on revenues in excess of $500,000 for a period of ten years.  The firm must also pay a 
1per cent royalty on equity raised in excess 
of $500,000.  The royalty payments are capped at three times the Challenge investment received.   Ongoing 
Maryland  Empowerment 
Zone Incentives Empower 
Baltimore Management 
Corporation Mixed Tax A federally designated 
Empowerment Zone in Baltimore encompasses 6.8 square miles in 
three distinct areas of the City, two 
of which include sites zoned for heavy industrial use.  The 
Empowerment Zone is also a state 
enterprise zone.  All companies located within the 
Empowerment Zone. Empowerment zone incentives include: federal 
income tax credits, increased depreciation on equipment, tax exempt  bond financing and job 
training resources. Ongoing  
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Maryland  Enterprise 
Investment Fund Maryland 
Department of 
Business and 
Economic Development Equity This programme makes direct 
equity investments in emerging 
technology companies with 
patented or proprietary products or manufacturing processes and a 
marketing strategy in place.  The 
Enterprise Investment Fund works with emerging companies to move 
them into their next stage of 
development as a viable business. Requirements include: 
• Applicants must be in a technology 
industry.  Areas of technology include 
biotechnology, telecommunications, information technology, life sciences 
and advanced materials. 
• The applicant must agree to maintain its principal place of business in 
Maryland for five years. 
• A minimum 3:1 match by a sophisticated investor is required.  A 
sophisticated investor may be a venture 
capital firm, a corporate strategic investor, or other individuals seen as 
knowledgeable about the industry 
segment. The amount of investment ranges from $150,000 to 
$500,000.  Enterprise investments are generally in 
the form of equity, but it may be another type, e.g. 
debt issues, as initiated by the lead investor.  To be considered for either programme, a company must 
submit a full business plan and meet the criteria 
listed.  Ongoing 
Maryland  Enterprise Zone 
Tax Credits Maryland 
Department of 
Business and Economic 
Development Tax Credit Enterprise zones in the state offer 
an attractive locational alternative 
for industrial and commercial businesses.  Areas within enterprise 
zones that meet more stringent 
standards of eligibility may be declared focus areas. Businesses located in a Maryland 
Enterprise Zone may be eligible for 
income tax credits and real property tax credits in return for job creation 
and investments made in the zone.  
Thirty enterprise zones and four focus areas are located throughout the state.  Real property tax credits;  Income tax credits;  
Enhanced Job Creation Tax Credits; Priority access 
to Maryland's financing programmes.  Enhanced Focus Area Benefits include Real property tax 
credits;  Personal property tax credits;  Income tax 
credits.  In addition to 30 state-designated zones, Maryland has three Federal Empowerment Zone 
areas that have enterprise zone status.  These zones 
represent different mixes of industrial and commercial activity that will meet the 
circumstances and preferences of new or 
expanding businesses. Ongoing.  
Enterprise 
zone designation 
is for 10 
years;  Focus area 
designation 
is for 5 years.  
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Maryland  Job Creation Tax 
Credit Maryland 
Department of 
Business and 
Economic Development Tax Credit Maryland's Job Creation Tax Credit 
programme provides tax credits to 
businesses that create new jobs.  
The purpose of these incentives is to encourage businesses to expand 
or relocate in Maryland.  The 
business must create 60 new, full-time jobs at the expanding or new 
facility during a 24-month period. 
In designated "priority funding areas", the minimum is 25.  Outside 
"priority funding areas", the 
requirement may be reduced to as few as 30 new jobs if the aggregate 
annual salary of the new employees 
exceeds $2.36 million (for 2004). Only new jobs that pay more than 
150 per cent of the federal 
minimum wage are eligible for the credit.  The expansion or 
establishment of a business must be 
at a single location in the state.  A single firm may have more than one eligible location, provided that each 
is certified and meets the 
requirements of the statute.  The job must be filled for 12 months before 
it is qualified for the tax credit.   The new or expanded facility must be 
engaged in an eligible activity defined 
as primarily engaged in:  
manufacturing, transportation or communications, agriculture, forestry, 
fishing or mining, a public utility, 
warehousing, research, development, or testing, biotechnology, computer 
programming, data processing or other 
computer related services, central financial, real estate or insurance 
services, the operation of central 
administrative offices or a company headquarters, business services firms 
(only located in a "Priority Funding 
Area").  A business may also be engaged in the operation of 
entertainment, recreation, cultural or 
tourism related activities in a multi-use facility located with in a revitalization 
area if the facility generates a 
minimum of 1,000 new full-time equivalent filled positions in a 2-year period.   Credit granted will be the lesser of $1,000 or 2-1/2 
per cent of a year's wages for each new, full-time 
job calculated on an aggregate basis.  If the new or 
expanded facility is located  in a state enterprise 
zone, a federal empowerment zone or a DHCD 
designated neighbourhood, then the credit is 
increased to the lesser of $1,500 or 5 per cent of a year's wages for each new, full-time job.  The 
maximum credit allowed during any credit year for 
a single facility is $1 mill ion.  If during 3 years 
succeeding the credit years, the average number of 
qualified positions falls below the applicable 
threshold number, all credits shall be recaptured.  If the number of qualified positions falls more than 
5 per cent, but not below the applicable threshold 
number, then the credit is recaptured in proportion to the decline in certif ied employees.  Unused 
credits may be carried forward for up to five tax 
years following the year in  which the credit could 
first be used to reduce ta x liability.  The credit may 
not be used to reduce taxes owed for earlier years. The Job 
Creation Tax 
Credit 
remains in effect until 
1 January 
2010, subject to extension 
by the 
General Assembly. 
Maryland  Maryland 
Economic 
Adjustment Fund (MEAF) Department of 
Business and 
Economic Development Loan The programme is codified in 
Article 83A Subsections 6-501 
through 6-512.  MEAF was established as a non-lapsing 
revolving fund to make loans to 
new or existing companies in communities suffering dislocation 
due to defence adjustments to 
enable the companies to modernize their manufacturing operations, develop commercial applications 
for technology, or enter into and 
compete in new economic markets.   • Applicants must demonstrate 
creditworthiness, the ability to repay 
the obligation, an d the inability to 
obtain financing on affordable terms 
through normal lending channels.   
• State designated eligible locations include Baltimore City and Baltimore, 
Howard, Anne Arundel, Harford, 
Queen Anne's, Somerset, Worcester, Dorchester, Allegany and Washington counties.  
• A loan may not be used to relocate 
jobs from one commuting area to another.  The programme is administ ered in accordance with 
the guidelines imposed by the Federal 
Government's Economic Development Act (EDA). The maximum amount of the loan to any one 
borrower is $500,000.  
 Ongoing  
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Maryland  Maryland 
Economic 
Development 
Authority and Assistance Fund 
(MEDAAF) Department of 
Business and 
Economic 
Development Mixed 
Financing Article 83-A, subsection 5-1401 
through 5-1411 of the Annotated 
Code of Maryland.  Significant 
Strategic Economic Development Opportunities - A project in an 
eligible industry that provides a 
significant economic development opportunity on a statewide or 
regional level.  To qualify for assistance from 
MEDAAF, applicants are restricted to 
businesses located within priority 
funding areas and eligible industry sectors.  To qualify for a grant, the 
jurisdiction must provide a 100 per 
cent match of the requested grant amount unless the local jurisdiction is, 
or is located in, a qualified distressed 
jurisdiction, then the match must be equal to at least 50 per cent of the 
requested grant amount.   
Special purposes loans - This capability targets specific funding 
initiatives that are deemed critical to 
the State's economic health and development.  The use of funds 
includes the acquisition and 
development of land for industrial sites, development of water and sewer 
lines and other infrastructure 
improvements, construction of shell buildings, acquisition of fixed assets and leasehold improvements, up to 
70 per cent of the co st of feasibility 
studies, and up to 50 per cent of the cost of preparing local economic 
development plans.  
Regional or local revolving loan fund - Grants to local juri sdictions to help 
capitalize local revolving loan funds.  
• Eligible applicants include a county or regional economic development 
agency, whether public or private.  A 
jurisdiction may transfer all, or a portion of its allocation to a regional 
revolving loan fund.  
• Each jurisdiction may receive a grant of $250,000 annually.  The Department 
may not make grants totalling more 
than $2 million per fiscal year.  • The specific programme determines 
the level and type of financial 
assistance provided.  • The special purpose initiatives 
include the Brownfield Revitalization 
Incentive, Seafood and Aquaculture, Animal Waste, Day Care, and the Arts & Entertainment Districts.   There are five financing capabilities offered 
through this incentive programme, with assistance 
being provided to the business community and 
political jurisdictions.  With a few exceptions, assistance cannot exceed 70 per cent of the total 
project cost unless the recipient is the Maryland 
Economic Development Corporation (MEDCO), which can request 100 per cent assistance. 
The specific capabilities are: 
• Assistance is provided  to a business or MEDCO 
in the form of a loan.  
• Maximum assistance cannot exceed the lesser of 
$10 million or 20 per cent of the current fund balance.  
Local Economic Development Opportunity - A 
business that provides a valuable economic development opportunity to the jurisdiction in 
which the business is located  and is a priority for 
the governing body of that jurisdiction. • The local jurisdiction must sponsor the business 
and must participate in the form of either a 
guarantee, a direct loan, or a grant in an amount equal to at least 10 per cent of the State's financial assistance.  
• Loans may be up to $5 million, while conditional 
loans and grants may be up to $2 million.  Direct Assistance to local jurisdictions or MEDCO 
- The Department may provide financial assistance 
to local jurisdictions for local economic development needs.  Certain jurisdictions may 
qualify as "distressed ju risdictions" where the 
unemployment rate for the most recent 18 month period is at least 150 per cent of the State's 
unemployment rate for the same period, and the 
average per capita personal income for the most recent 24 month period is at or below 67 per cent 
of the State's per capita  personal income for the 
same period. • The total amount of assistance cannot exceed 
$3 million, except for qualified distressed 
jurisdictions where local strategic economic development plans have been approved by the 
Department.  Ongoing  
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Maryland  One Maryland 
Economic 
Development Tax 
Credits Department of 
Business and 
Economic 
Development Tax Credit To encourage economic 
development projects in distressed 
counties of the state. The business project must be located in 
a "qualified distressed county":  
Baltimore City or Allegany, Caroline, 
Dorchester, Garrett, Somerset or Worcester County.  The business entity 
must be primarily engaged at the 
facility in one or more eligible industries:  manufacturing, agriculture, 
testing, computer programming, 
mining, fishing, research, computer-related services, transportation,  
forestry, development, data processing, 
central insurance services, biotechnology, communications, 
company headquarters, central 
financial services, business services, public utility, central administrative 
offices, central real estate services, 
warehousing, filmmaking and resort/recreational business. Businesses can qualify for up to $5.5 million in tax 
credits under the One Maryland Tax Credit 
Programme.  A qualified business entity may claim 
both a start-up tax credit and a project tax credit.  Tax credits may be claimed against State income, 
insurance premium, or financial institution 
franchise tax. Project tax credits of up to $5,000,000 are based on 
qualifying costs and expenses incurred by the 
business entity in connection with the acquisition, construction, rehabilitati on, installation, and 
equipping of an eligible economic development 
project.  The business entity must incur at least $500,000 in eligible project costs and must create 
at least 25 new qualified positions.  
Start-up tax credits of up to $500,000 are based on a business' cost to furnish and equip a new location 
for ordinary business functions and to move to a 
qualified distressed county from outside Maryland. 
(50 qualified new positions are required to qualify 
for the full $500,000 credit.)  Ongoing 
Massachusetts Economic 
Development 
Incentive Program 
(EDIP) Massachusetts 
Office of 
Business 
Development Tax Credit Designed to stimulate job creation 
in distressed areas, attract new 
businesses, encourage existing 
businesses to expand and increase the overall economic development 
awareness and readiness of the 185 
participating cities and towns across the Commonwealth.  Administered 
through the Office of Business 
Development, the EDIP represents the cooperative efforts of 
communities, businesses and the 
state.  Designated Economic Target Areas. Through the EDIP, businesses and communities 
negotiate a local real estate tax incentive 
agreement.  In turn, these businesses become 
eligible for the state's enhanced 5 per cent Investment Tax Credit and, where applicable, the 
state's 10 per cent Abandoned Building Tax 
Deduction.  In addition, the programme also targets and prioritizes capital spending, including such 
programmes as Public Works for Economic 
Development (PWED) monies and Community Development Action Grants, to communities 
within Economic Target Areas. Ongoing 
Massachusetts Investment Tax 
Credit Massachusetts 
Office of 
Business 
Development Tax Credit Massachusetts gives businesses a 
3 per cent Investment Tax Credit 
against corporate excise tax for the 
construction of manufacturing facilities.  The credit also applies to 
the purchase or lease of equipment. Companies involved in manufacturing, 
research and development, agriculture 
or commercial fishing in designated 
Economic Target Areas. Unused portions of the tax credit may be carried 
over to subsequent years.  An enhanced 5 per cent 
investment credit is available.   Ongoing  
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Massachusetts Seafood Loan 
Program Mass 
Development Loan The Seafood Loan Program was 
created to enhance the 
competitiveness of Massachusetts 
$1 billion seafood processing industry.  The programme provides 
direct loans for fixed asset 
financing needs including the purchase of land, buildings, 
equipment and for the construction 
or renovation of facilities.  Funds cannot be used for revolving 
working capital or for the purchase 
of vessels.   Seafood processing industry. The maximum amount is $200,000, with a 10-year 
term for real estate loans and a 7-year term for 
equipment loans.  Loans may be amortized for a 
maximum of 20 years and ha ve a fixed or floating 
interest rate at prime plus a premium. Ongoing 
Massachusetts Seafood 
Revolving Loan Fund Mass 
Development Loan/Non-
traditional financing The Seafood Revolving Loan Fund 
provides financing in cooperation with private lenders, to fishing 
vessels and shore side facilities.  To 
be eligible, a business must demonstrate that it has been adversely affected by the federal 
fishing regulations enacted to 
rebuild the depleted stocks of cod, haddock and flounder.  The fund is 
capitalized through the a grant from 
the Economic Development Administration with matching funds 
provided by Mass Development.  Seafood industry. The loan fund uses two types of financing.  The 
first is a micro loan with a max of $50,000 to assist businesses.  The second loan provides gap 
financing of up to $100,000.  Loans have a fixed 
rate of 8 per cent for the initial lending period.  Under the terms of the grant, business must be located in Barnstable, Bris tol, Nantucket, Norfolk, 
Plymouth or Suffolk counties.  Start-up ventures 
are not eligible. Ongoing 
Massachusetts Urban Initiative 
Fund Community 
Development 
Finance Corporation Loan To help support minority owned 
businesses. Minority owned businesses with less 
than $500,000 in annual sales in 
targeted urban communities. Loans up to $200,000. Ongoing 
Massachusetts Venture Capital 
Fund Community 
Development 
Finance 
Corporation Loans/ 
Equity 
Financing To help create and support 
employment in low income 
communities. Firms in low income communities 
which have a community development 
corporation, to enable them to expand 
or retain employment for local residents. $100,000 to $300,000 per project, up to 1/3 of total 
financing. Ongoing  
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Massachusetts Emerging 
Technology Fund Massachusetts 
Development 
Finance Agency 
(Mass Development) Loan The Emerging Technology Fund 
provides loan guarantees to 
leverage private de bt financing for 
specialized research and development or manufacturing 
facilities. 
Two types of projects are eligible for financing:  1) The fund can be 
used to leverage private financing 
for the construction of state of the art manufacturing, research and 
development facilities.  2) The fund 
can be used to provide matching grants to universities and private 
institutions for ad vanced research 
and development of new and emerging technologies in the 
Commonwealth. Technology Companies The maximum guarantee amount is $1,500,000 or 
50 per cent participation of the aggregate debt, 
whichever is less.  The maximum loan amount for 
facilities is $2,500,000 or 33 1/3 per cent participation of the aggr egate debt, whichever is 
less.  The maximum loan amount for equipment is 
$500,000 or 33 1/3 per cent participation of the aggregate debt, whichever is less. Ongoing 
Massachusetts Jobs Creation 
Incentive Payment Department of 
Revenue Grant Qualifying biotechnology and 
medical device manufacturing 
companies are eligible to receive 
incentive payments for new job creation. The jobs incentive payment for newly 
created manufacturing jobs is available 
to corporations engaged primarily in 
the research, development, production or provision of biotechnology, or 
manufacturers engaged in the 
production of products for a medical device manufacturing business 
primarily engaged in manufacturing 
medical or surgical instruments, surgical appliances or supplies, or 
electromedical, electrotherapeutic or 
irradiation apparatus. A qualifying biotechnology or medical device 
manufacturing company that creates 10 or more 
eligible jobs in the Commonwealth during a single 
calendar year shall be entitled to an incentive 
payment equal to 50 per cent of the eligible job's 
salary multiplied by the applicable Massachusetts 
income tax rate of the newly hired persons.  The jobs incentive payment will be paid in three equal 
instalments in each of th e following three years. Ongoing 
Michigan Economic 
Development Job Training Michigan 
Economic Development 
Corporation Grant This programme is a major feature 
of the state's economic development incentive package.   Under this 
programme, the employer designs 
the customized training and works with private or public education providers.  Employers are at the 
front end, designing their own 
customized employee training programmes and working in 
partnership with schools, 
government agencies and other community resources. Advanced Manufacturing, Information 
Technology, and Life Science/Bio Technology. Michigan's Economic Development Job Training 
(EDJT) Programme pr ovides approximately 
$10 million in competitive grants to companies that 
need to train or retrain workers to meet 
marketplace needs.  Gr ants average $500 per 
employee.  The employer must match 25 per cent of the state grant.  Match can be in-kind. Ongoing  
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Michigan Job Creation Tax 
Credits Michigan 
Economic 
Growth 
Authority Tax Credit In 1995, Michigan enacted the 
Michigan Economic Growth 
Authority (MEGA). Firms that are 
financially sound and have financially sound proposed plans 
might be eligible to receive a tax 
credit against the Michigan Single Business Tax (SBT).  This credit is 
for the incremental SBT liability 
attributable to an expansion/new location project and/or the amount 
of personal income tax attributable 
to new jobs being created.  To promote high quality economic 
growth and job creation.  Eligible 
Companies engaged in manufacturing, 
research and development, wholesale and trade, or office operations. Each credit may be awarded for up to 20 years and 
100 per cent of the incremental SBT liability 
and/or personal income tax attributable to the 
project.  Beginning March, 2000, the application fee was increased to $5,000 for companies 
applying for MEGA tax credits.  This fee is 
collected at the time the company submits its final application for a credit.  In addition, a one-time 
only administrative fee of 1/2 of one per cent of the 
estimated value of the in centive will be collected.  
This fee is payable at the time the company is 
certifying its eligibility to receive awards and is 
limited to no more than $100,000. Ongoing 
Michigan Technology Tri-
Corridor Michigan 
Economic 
Development 
Corporation Grant Not more than $5 million of the 
fund is to be distributed on a 
competitive basis to support 
commercialization (Category III) for life sciences development 
projects in Michigan for Michigan 
for-profit and non-profit entities.  Of the remaining funds available, 
fifty-five per cent of the fund is to 
be allocated for basic research (Category I), and distributed on a 
competitive basis to Michigan 
universities or Michigan non-profit research institutes.  Forty-five per 
cent of the funds are to be allocated 
on a competitive basis for collaborative applied research 
(Category II) among Michigan 
universities, companies and/or private and non-profit research 
facilities with emphasis on testing 
or developing emerging discoveries.  All funding is distributed based on an external 
independent expert peer review 
process which competitively reviews the science, technology and 
commercialization potential of 
proposed projects. Statewide.   Funding of new projects is limited to the amount 
appropriated each year.  F unds projects up to three 
years.   Ongoing  
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Michigan Michigan Smart 
Zones Michigan 
Economic 
Development 
Corporation Various 
business 
services To stimulate the growth of 
technology-based businesses and 
jobs by aiding in the creation of 
recognized clusters of new and emerging businesses, those 
primarily focused on 
commercializing ideas, patents, and other opportunities surrounding 
university or private research 
institute R&D efforts. The SmartZone programme has 
identified 11 locations throughout the 
State of Michigan with necessary 
resources to nurture technology business growth ranging from research 
and development with universities to 
entrepreneurial training.  The Smart Zones are in:  Ann Arbor/Ypsilanti 
(University of Michigan), Battle Creek 
(Western Michigan  University), 
Detroit (Wayne State University), 
Grand Rapids (Grand Valley State 
University/Van Andel Institute), Houghton/Hancock (Michigan 
Technological University), Kalamazoo 
(Western Michigan  University), 
Lansing/E. Lansing (Michigan State 
University), Mt. Pleasant (Central 
Michigan University), Muskegon (Grand Valley State University), 
Oakland County (Oakland University), 
and Pinnacle Aeropark. Each SmartZone has the ability to capture tax 
increments resulting from new development within 
the zone to support zone activities for a period of 
15 years. Ongoing 
Michigan Renaissance 
Zones Michigan 
Economic 
Development 
Corporation Tax Credit Michigan's Tax-Free Renaissance 
Zones are composed of 
152 geographic areas of the state 
designated as virtually tax free for any business or resident presently in 
or moving to a zone.  The zones are 
designed to provide selected communities with a powerful market based incentive--no taxes-- 
to spur new jobs and investment. 152 geographic areas of Michigan are 
tax free. By law, Renaissance Zones waive the following 
local and state taxes:  Michigan Single Business 
Tax;  Michigan Personal In come Tax;  Michigan's 
6 mil State Education Tax;  Local Personal Property Tax;  Local Real Property Tax;  Local 
Income Tax;  and Utility Users Tax.  These taxes 
represent nearly all state and local taxation on a Michigan business.   Ongoing 
Michigan Urban Land 
Assembly 
Program Michigan 
Economic 
Development Corporation Loan The Urban Land Assembly 
Program provides low interest loans 
to cities to enable them to purchase land for economic development 
projects.  Funds can be used to 
purchase industrial property or property in a downtown 
development authority. Projects located in cities that have 
experienced a local unemployment rate 
more than 70 per cent of the annual average state unemployment rate;  a 
growth in local population that is less 
than 75 per cent of the state's population growth rate;  or a change in 
local state equalized value that is less 
than 50 per cent of the state's five-year average. Determined on a case-by-case basis. Ongoing  
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Minnesota Enterprise Zone 
Program Department of 
Employment & 
Economic 
Development Tax Credit The Zone Program provides 
business tax credits (income, 
property, sales) to qualifying 
businesses, which create investment, development, job 
creation or retention in the 
Enterprise Zone.  Tax credits are allocated by the State to Enterprise 
Zone Cities.  Businesses apply for 
tax credits through the city Enterprise Zone coordinator.  Tax 
credits include: property tax credits, 
debt financing credit on new construction, sales tax credit on 
construction equipment materials 
and new or existing employee credits.   The Cities of Breckenridge, Dilworth, 
East Grand Forks, Moorhead, 
Ortonville and Duluth Not available. Ongoing 
Minnesota Rural Challenge 
Grant Program Department of 
Employment & Economic 
Development Loan The Office of Regional Initiatives 
has a partnership with each of the six Minnesota Initiative Funds to 
provide low-interest loans to new or 
expanding businesses in rural Minnesota.   Eligible applicants include businesses 
located, or intending to  locate, in rural 
Minnesota.  "Rural" is defined as the 
80 counties of Minnesota other than 
the Twin Cities metropolitan area. Maximum loan available is $200,000 up to 50 per 
cent of start -up or expansion costs.  Most loans will be smaller due to the high demand for funds 
compared with the funds available.  The interest 
rate is between 3 per cent and 10 per cent, and the terms will be consistent with other sources of 
project financing.  Each Initiative Fund will 
determine the specific interest rate and collateral requirements.  Each dollar of challenge Grant 
funds must be matched by at least one dollar of 
non-public funds, usually owners' equity and/or private financing.   Ongoing 
Minnesota Urban Initiative 
Program Department of 
Employment & 
Economic 
Development Business 
Assistance Urban initiative Board enters into 
partnerships with local non-profit 
organizations that provide loans and 
technical assistance to start-up and expanding businesses.   Eligible applicants include minority 
businesses and others creating jobs for 
low income people in Minneapolis, St. 
Paul, Hopkins, Columbia Heights, Hilltop, South St. Paul, West St. Paul, 
St. Anthony, Mendota and Lauderdale. Not available. Ongoing 
Minnesota Minnesota 
Investment Fund Department of 
Employment & 
Economic 
Development Loan Leverage private investment for 
business expansions. Eligible businesses locating to or 
expanding in Minnesota. Maximum loan is $500,000 Ongoing 
Minnesota Job Opportunity 
Building Zones (JOBZ) Department of 
Employment & Economic 
Development Tax Credit JOBZ provides for a combination of 
tax exemptions and credits including income tax, property tax, 
sales and use tax, and job creation 
credits for up to 12 years.  For qualified businesses making 
qualified investments and creating 
new jobs in rural Minnesota.   Eligible businesses in rura l Minnesota. Not available. Exemptions 
and credits are allowed 
until 
31 December 2015  
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Mississippi Jobs Tax Credit Mississippi 
Development 
Authority Tax Credit Provides a five-year tax credit to 
the company's state income tax bill 
for each new job created by a new 
or expanding business, effective for years two through six after the 
creation of the job. Eligible businesses include 
manufacturers, processors, distributors, 
wholesalers, warehouses, research and 
development facilities, air transportation and maintenance 
facilities, final destination or resort 
hotels having a minimum of 150 rooms and movie industry studios. The amount of credit depends on the development 
status of the county in which the business is 
located:  (1) $2,000 per ne w job for less developed 
counties, (2) $1,000 per new job for moderately developed counties, and (3) $500 per new job for 
developed counties.  A minimum number of new 
jobs must be created to be eligible for this credit.  
In less developed counties,  businesses must create 
at least 10 new jobs to be eligible for the credit;  in 
moderately developed c ounties, 15 new jobs; and 
in developed counties, 20 new jobs.  The county 
status will be re-assessed annually by the 
Mississippi State Tax Commission, according to each county's unemployment rate and per capita 
income averages over th e prior three years.  
Limited to an amount not greater than 50 per cent of the taxpayer's state income tax liability for the 
year in which the credits are taken.  Any excess 
credit may be carried forward for five successive years. Ongoing 
Mississippi Major Economic 
Impact Authority Mississippi 
Development 
Authority Bond This programme allows the State, 
through the issuance of general 
obligation bonds, to assist local communities in meeting the 
development requirements inherent 
in large capital projects, thereby generating an investment in the 
quality of life in such communities. Eligible projects include industrial or 
commercial projects, research and 
development, warehousing, distribution, transportation, processing, 
mining establishments, US 
Government projects, and tourism facilities. Major Impact Authority projects can be new 
projects or expansions of existing facilities which 
have a minimum initial investment of $300 million by the private sector or the US Government. Ongoing 
Mississippi Minority Surety 
Bond Guaranty Program Mississippi 
Development Authority Guarantee This programme was created to 
enable minority contractors, not meeting the surety industry's 
standard underwriting criteria, to 
obtain bid and performance bonds on contracts with state agencies and 
political subdivisions within 
Mississippi.   Statewide.   Maximum bond guaranty is 75 per cent of contract 
bond amount or $112,500, whichever is less.  A contractor may have more than one guaranteed 
bond as long as total ties do not exceed $112,500.   Ongoing  
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Mississippi Mississippi State 
Port Income Tax 
Credit Mississippi 
Development 
Authority Tax Credit The purpose of this tax credit is to 
promote the increased use of ports 
and related facilities in the state – 
particularly by those taxpayers which would not otherwise use such 
ports and related facilities without 
the benefit of the tax credit – and increase the number of port related 
jobs and other economic 
development benefits associated with the increased use of such ports 
and related facilities.   Ports.   Allowable Credit: the following are charges which 
a taxpayer may claim as a credit; receiving into a 
port, handling of a vessel, wharfage.  Amount of 
Credit:  credit may not exceed 50 per cent of the tax imposed upon the taxpayer for the taxable year 
reduced by the sum of all credits allowable to the 
taxpayer.;  any unused portion of the credit may be carried forward for the succeeding five years;  the 
maximum cumulative credit which may be claimed 
by the taxpayer is limited to $1million dollars for the period 1 January 1994 through 
31 December 1998.   Ongoing 
Mississippi Sales and Use Tax 
Exemption Mississippi 
Development 
Authority Tax 
Exemption Manufacturers pay a 1.5 per cent 
sales tax on machinery and parts 
used directly in manufacturing and 
port operations (purchase or rental) and industrial electricity, natural 
gas, and fuels.  Manufacturers pay a 
3.5 per cent contractor's fee for all costs (exceeding $10,000) included in a contractor's construction 
contract, including the costs of 
construction labour and the purchases of construction 
component materials made by the 
contractor on behalf of the manufacturer.   New or expanding manufactures 
located in less developed counties. New or expanding manufacturers located in less 
developed counties pay no sales taxes for:  (1) 
building construction materials, or (2) purchases of 
machinery or equipment associated with a location or expansion, if the building materials or 
equipment are purchased directly from a supplier 
(purchases of construction materials made through a contractor incur the 3.5 per cent contractor's fee).  New or expanding manufacturers located in either 
moderately developed or de veloped counties pay a:  
(1) 3.5 per cent sales tax for purchases of building construction materials and new machinery or 
equipment not used directly in the manufacturing 
process, and (2) 0.75 per cent sales tax on purchases of all machinery and equipment that is 
used directly in the manufacturing process. Ongoing  
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Missouri (update) Enterprise Zones Department of 
Economic 
Development Tax Credit The Department of Economic 
Development may recommend the 
establishment of enterprise zones in 
economically depressed areas that are not likely to achieve 
development otherwise.  The 
recommendations are made to the Joint Legislative Committee on 
Economic Development Policy and 
Planning, which may designate the area an enterprise zone.  Enterprise 
zones offer many types of tax 
credits, exemptions, abatements and refunds to taxpayers who establish 
new or expanding, facilities in any 
designated enterprise zone. The statute permits governing 
authorities to petition the Department 
of Economic Development to have the 
boundaries of an existing, enterprise zone expanded.  Th e expansion may be 
approved if there have been no more 
than three expansions. Areas designated as federal 
empowerment zones or enterprise 
communities are automatically granted state enterprise zone status.  In order to 
qualify for either the income 
exemption or the investment credit, the taxpayer must in addition to the above 
criteria, meet the "30 per cent Test".  
To meet the test, at least 30 per cent of the new employees at the new or 
expanded facility must be either 
residents of the enterprise zone, or have been unemployed for at least 
90 days prior to being employed at the 
new or expanded facility, or eligible for AFDC or General Relief, or some combination thereof The Department 
of Economic Development may waive 
or reduce this requirement for one year if there are 20 or fewer persons 
employed at the facility.   Tax benefits may include:  $400 for each new job 
created, and $400 for each qualified employee who 
is a resident of the enterprise zone, and $400 for 
each qualified employee who was either unemployed for at least 90 days prior to the time 
he/she was hired at the ne w or expanded facility or 
who was eligible for AFDC or General Relief at the time he/she was employed at the new or 
expanded facility, and up to $400 for each 
qualified employee who is trained from the employer's own funds, and a possible exemption 
equal to one-half of the in come attributed to the 
new or expanded portion of  the facility, and a 
possible investment tax credit equal to 10 per cent 
of the first $10,000 of new investment, 5 per cent 
on the next $90,000 of new investment and 2 per cent on all investment over $100,000, and up to a 
$75,000 refund for unused tax credits earned by a 
new facility, and a real property tax abatement of at least 50 per cent for ten years if the facility is 
used for manufacturing, mining, wholesale 
distribution or warehousing.   This 
programme 
was 
sunsetted during the 
2004 
legislative session and 
has been 
replaced with Enhanced 
Enterprise 
Zone.    
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Missouri Missouri "Build" 
Program Department of 
Economic 
Development/Mi
ssouri Development 
Finance Board Tax Credit Missouri Business Use Incentives 
for Large-Scale Development 
(BUILD) provides a financial 
incentive for the location or expansion of larger business 
projects.  The programme provides 
Missouri state income tax credits to the business in the amount of debt 
service payments for industrial 
revenue bonds related to a portion of project costs. The bonds may be used to finance 
public or private infrastructure used to 
support the project, or the new capital 
improvements of the business at the project location.  Bond proceeds may 
not be used for working capital, 
inventory or other operating costs of the business or other entity.   
Eligible businesses are:  (1) 
Manufacturing, processing, assembly, research and development, agricultural 
processing or services in interstate 
commerce which will invest a minimum of $15 million in capital 
improvements for a project and create 
at least 100 new jobs within three years. 
(2) Office projects (regional, national 
or international headquarters, telecommunications operations, 
computer operations, insurance 
companies or credit card billing and processing centres) are also eligible if the capital improvements exceed 
$10 million and at least 500 new jobs 
are created within three years.  Retail, health or professional services, intra-
state relocations or replacement 
facilities are not eligible. The bonds must be sold on the basis of the 
business' credit.  The options are (a) the business 
purchases a bank letter of credit or bond insurance;  
(b) the business has an investment bond rating;  (c) the business arranges for a private placement 
purchase of the bonds;  or (d) the business 
purchases the bonds.  The political subdivision benefiting from the project or other local entities 
must commit significant local incentives.  Such 
incentives may include tax abatement, discounted utility fees or others.   Ongoing  
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Missouri Real Property Tax 
Increment 
Allocation 
Redevelopment (TIF) Department of 
Economic 
Development Loan Tax increment financing can be 
used in any city or county in the 
State of Missouri.  It is helpful to 
small communities in order to finance the construction of 
necessary public improvements 
such as sewers and roads as an 
incentive for investment in areas to 
be redeveloped, rehabilitated or 
revitalized.  To encourage such development, real property tax 
revenues and 50 per cent of tax 
revenues are diverted into a special allocation fund which can be used 
to defray redevelopment costs.  The 
tax revenues diverted to the fund are attributed to the increased 
valuation of improvements made to 
real property within the designated areas.  Upon the implementation of 
TIF for a particular area, up to 
100 per cent of the increased amount of real property taxes and 50 per cent of other taxes generated 
by new development in the area 
(primarily sales tax) are set aside in a Special Allocation Fund.  These 
funds may be used by the 
municipality or a private developer for Redevelopment Project Costs.   An area, as defined by a municipality, 
that benefits from the improvements.  
There are no particular limitations on 
district boundaries, except that the area must be determined by the city or 
county to be blighted or a conservation 
area. Beginning 1 January 1998, certain blighted areas 
of municipalities with a pproved plans and projects 
to receive appropriated amounts, from the newly 
created Missouri supplemental tax increment financing fund, of up to 50 per cent of "new state 
revenues," defined as either  1) state sales taxes, 
except those which are constitutionally dictated, School District Trust Fund taxes, sales and use 
taxes on motor vehicles , trailers, boats and 
outboard motors, and future sales taxes earmarked by law, or 2) state income tax withholding.  An 
aggregate annual appropriation of new state 
revenues for super redevelopment areas is limited to $15 million.  The duration of redevelopment 
projects shall not exceed 23 years. 2005 
Legislative Session increased programme cap to $32M Ongoing 
Missouri Wine and Grape 
Production Tax 
Credit Program Department of 
Economic 
Development Tax Credits To attract business into the state of 
Missouri. Vineyards and wine producers. State income tax credit to an individual, 
partnership or corporati on in an amount equal to 
25 per cent of the purchase price of all new 
equipment and materials used directly in the growing of grapes or the production of wine in 
Missouri.   Ongoing 
Missouri Development Tax 
Credit Department of 
Economic 
Development Tax Credit To facilitate a business project in 
order to create jobs. Priority projects are businesses 
primarily engaged in manufacturing, 
service, processing and assembly that 
pay wages above the area average and include benefits.  Other types of 
projects may be considered for 
approval if tax credits remain near the end of the fiscal year.  Project must be 
located in or qualify as a blighted or 
conservation area.   Offers state tax credits to taxpayers making 
contributions to a not-for-profit corporation in the 
amount of 50 per cent of the contribution.   Ongoing  
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Missouri Enhanced 
Enterprise Zones Department of 
Economic 
Development Tax Credit The Enhanced Enterprise Zone 
Programme is a discretionary 
programme offering state tax 
credits and local real property tax abatement to Enhanced Business 
Enterprises.  The purpose is to 
provide tax credits to new or expanding businesses in a Missouri 
Enhanced Enterprise Zone. An eligible project must be located in a 
Missouri Enhanced Enterprise Zone.  
Enhanced Enterprise Zones are 
specified geographic areas designated by local governments and certified by 
the Department of Economic 
Development (DED).  Zone designation is based on certain 
demographic criteria, the potential to 
create sustainable jobs in a targeted industry and a demonstrated impact on 
local industry cluster development.  
Individual business eligibility will be determined by the zone based on 
creation of sustainable jobs in a 
targeted industry or demonstrated impact on local industry cluster 
development.  Gambling 
establishments, retail trade, and food and drinking places are prohibited 
from receiving the state tax credits.  
Service industries can be eligible if a majority of their annual revenues will be derived from services provided out 
of the state.  State tax credits will be an amount authorized by 
DED based on the number of new jobs/payroll and 
new capital investment that the project creates, 
limited to the lesser of the sum of $400 per new job and 2 per cent of new capital investment or the 
state economic benefit.  The real property tax 
abatement is determined by the sponsoring community and may be between 50 per cent and 
100 per cent of the real property improvements for 
up to 25 years.   Ongoing 
Missouri Film Production Department of 
Economic 
Development Tax Credit Provides tax incentives to facilitate 
film production in Missouri. State tax credits are issued to a 
qualified film production company that 
has been pre-approved by the Department of Economic 
Development. Tax credits are issued for up to 50 per cent of the 
amount expended in Missouri for production or 
production-related activities. Ongoing 
Missouri Missouri 
Downtown 
Economic Stimulus Act 
(MoDESA) Department of 
Economic 
Development, Missouri 
Development 
Finance Board  Loan A portion of the new state and local 
taxes created by a project can be 
diverted to fund eligible public infrastructure and related costs for a 
period of up to 25 years.  The local 
match must be, at a minimum, 50 per cent of the amount of the new local sales tax (and earnings 
tax in St. Louis and Kansas City) 
and 100 per cent of the amount of the new real property tax created by 
the project each year;  or a 
comparable amount of local funds from the city/county or a non-profit 
organization. Municipalities with an annual median 
household income of $62,000 or less.  
"Central business districts" that are either "blighted" or a "conservation 
area".  At least 50 per cent of the 
buildings must be 35 years old or older.  Other restrictions apply.  Projects can be "community 
enhancement" or for "job creation".  
Total project costs and/or new job creation minimums are based on the 
population of the municipality.   A development project will not receive funds until 
it generates increment.  A development project 
cannot receive more than half of the increased 
amount of state sales tax and/or income tax it 
generates.  The programme is limited in any year 
to the amount appropriated by the General Assembly.  The law does not allow an annual appropriation to exceed $150,000,000, but the 
actual amount available in any year will depend 
upon the amount actually appropriated by the General Assembly.  In the event appropriations 
from the fund are not adequate to cover approved 
disbursements, projects will receive a pro-rata share of increment.   Ongoing  
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Missouri Missouri Rural 
Economic 
Stimulus Act Missouri 
Department of 
Economic 
Development, Department of 
Agriculture Loan A portion of the new state and local 
taxes created by the production 
facility project may be diverted to 
fund construction of eligible public infrastructure and related costs for a 
period of up to 25 years.  The local 
funding must be, at a minimum, 50 per cent of the amount of the 
new local Economic Activity Tax 
(sales and utility tax, etc.), and 100 per cent of the amount of the 
new real property tax created by the 
project each year, or a comparable amount of local funds from the 
municipality or a private non-profit 
organization.   Any incorporated Mi ssouri city, town, 
village or county established on or 
prior to 1 January 2001, having a 
population of 99,999 or less.  A contiguous and "blighted" 
Development Area, not encompassing 
more than 10 per cent of the area of an eligible municipality.  Projects must be 
for the creation of a renewable fuel 
production facility or other eligible new generation processing facility, 
with a cost of at least $3 million, and 
projected to create at least 30 new jobs. A project must produce a positive tax increment 
before funds can be received.  A project may 
receive up to half of the increased amount of state 
sales and/or income tax it generates.  The programme is limited in any year to the amount 
appropriated by the General Assembly.  Current 
law provides a maximum $12 million per year.  If appropriations are not adequate to cover 
disbursements, projects receive a pro-rata share of 
increment.   Ongoing 
Missouri Rebuilding 
Communities Department of 
Economic 
Development Tax Credit To stimulate business activity in 
Missouri's "distressed 
communities" by providing tax credits to eligible businesses that 
locate, relocate or expand their 
business within a distressed community.   Must have more than 75 per cent of its 
employees at the facility in the 
distressed community; have fewer than 100 employees total at all facilities 
nationwide;  and pr imarily engage in 
manufacturing, biomedical, medical devices, scientific research, animal 
research, computer software design or 
development, computer programming, telecommunications or a professional 
firm. Eligible new or relocating businesses may choose 
either a 40 per cent equipment tax credit or 40 per 
cent income tax liability tax credit and the employees may receive a 1.5 per cent employee tax 
credit.  Eligible business already located in a 
distressed community may be eligible for a 25 per cent equipment tax credit.   Ongoing  
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Montana Local Option 
Property Tax 
Exemptions Department of 
Revenue Tax 
Exemption Exemption for Business Incubators 
(Local Option):  If approved by the 
local governing body, a business 
incubator owned or leased and operated by a local economic 
development organization is 
eligible for an exemption from property taxes (MCA 15-24-18).  
Industrial Parks (Local Option):  If 
approved by the local governing body, an industrial park owned and 
operated by a local economic 
development organization or port authority is eligible for an 
exemption from property taxes 
(MCA 15-24-19).  Suspension, Cancellation of Delinquent Taxes 
(Local Option): 
If approved by the local governing body, delinquent property taxes on 
commercial property may be 
suspended to facilitate the purchase and continued operation of a business utilizing the commercial 
property (MCA 15-24-17).  Statewide.   There are numerous specialized tax incentives, 
which can be researched with the Department of 
Revenue on a case by case basis. Ongoing 
Montana Property Tax 
Abatements Department of 
Revenue Tax 
Abatement If approved by the local governing 
bodies, an existing value added 
industry that expands to include value-added equipment is entitled 
to receive a decrease in the tax rate 
on value-added machinery and equipment. Expanding "Value-Added" Machinery 
and Equipment.   Machinery used in canola seed oil processing is 
eligible for a taxable valua tion rate of 2 per cent in 
tax year 2001, 1 per cent in tax year 2002, and 0.0 per cent thereafter. Ongoing 
Nebraska Community 
Improvement 
Financing Department of 
Economic 
Development Loan Community Improvement 
Financing is Nebraska's version of 
Tax Increment Financing (TIF).  This is a method of financing public 
improvements associated with a 
private development project in a blighted area by using the projected 
increase in the property tax revenue 
which will result from the private development. This tax revenue increase is used to 
pay for the public improvements or is 
pledged to repay bonds issued by the local government or loans used to 
finance these improvements.  Revenue 
bonds can be issued to finance all or part of a site's public pre-construction 
improvements.  Public improvements 
include land purchase, clearance and sale, construction of streets, sidewalks, 
utilities, parks or other similar public 
spaces necessary in site preparation.  CIF, in effect, can reduce developer 
capitalization to a level that makes 
investment feasible. Not available. Ongoing  
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Nebraska Employment and 
Investment 
Growth Act Department of 
Revenue Mixed Tax The goal of Nebraska's 
Employment and Investment 
Growth Act (LB775) is the creation 
of jobs and business investment and expansion through the provisions of 
performance-based incentives to 
qualified businesses.  Businesses such as manufacturers, 
processors, research and development 
facilities, insurance and financial 
companies, telecommunications companies and administrative 
headquarters facilities of such firms, 
are eligible for th e tax incentives by 
meeting minimum thresholds for 
employment and investment.  
Qualifying businesses are eligible for credits attained over a seven year 
period and accumulated credits may be 
used during a 15 year period.  If required levels of investment and 
employment are not met within or 
maintained for a period of seven years, all or part of the incentives shall be 
disallowed or recaptured.   Three levels of incentiv es are available to 
qualifying businesses. Ongoing 
Nebraska Enterprise Zone 
Act Department of 
Economic 
Development Tax Credit The Enterprise Zone Act provides 
tax credits for qualifying businesses 
which, during any tax year, increase investment by at least $75,000 and 
increase net employment by an 
average of two full-time positions. Credits may be used to reduce a 
portion of the taxpayer's income tax 
liability or to obtain a refund of sales and use taxes paid.  Initial expansion must occur in one 
taxable year, but additional credits 
may be obtained for increasing employment by two or more full-
time employees during the next five 
years.  An additional investment of a required amount during this 
subsequent time is not required. In 
addition, a qualified business, under provisions of the Employment 
Expansion and Investment 
Incentive Act, may be allowed an enhanced credit against taxes 
imposed by the Nebraska Revenue 
Act of 1967 for locating and investing in an Enterprise Zone, 
while employing Zone residents.   Locations within Alda, 
Chadron/Crawford, Newman 
Grove/Meadow Grove, Omaha and Scotts Bluff County have been 
designated by the State of Nebraska as 
Enterprise Zones. The amount of the credit, not to exceed 
$75,000 per year, shall be:  (1) $4,500 for each 
new employee and $3,000 per $75,000 of investment provided at leas t 50 per cent of the new 
employees are Zone residents;  (2) $4,500 for each 
new employee who is a Zone resident, $1,500 for non-Zone residents, and $ 1,000 per $75,000 of 
investments;  or (3) the normal provisions for tax 
credits provided by the Employment Expansion and Investment Incentive Act - $1,500 per employee and $ 1,000 per $75,000 of investment.  
Credits not used in the fi rst year may be carried 
over and used against liabilities incurred in the next five taxable years.  Failure to maintain 
required levels of invest ment and employment for 
at least two years after creation of the credits will result in recapture of allowed benefits and loss of 
carryovers.   Ongoing 
Nebraska Ethanol Tax 
Credit Department of 
Revenue Tax Credits Support of ethanol producers. Tax credit available to ethanol 
producers. $0.20 per gallon. Ongoing  
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Nebraska Industrial 
Development 
Bonds/Locally 
Issued Nebraska 
Investment 
Finance 
Authority Bond Industrial Development Bonds 
(IDBs) may be issued by counties, 
incorporated cities, and villages to 
provide tax-exempt financing for private businesses.  The local 
governing body may issues bonds 
for projects outside as well as within a political jurisdiction.   Except as specified with respect to 
blighted areas, eligibility for IDB 
financing is limited to manufacturing 
or industrial facilities.  Selection criteria used by local governing bodies 
to screen eligible applicants may vary 
among localities. The maximum issue period is 30 years, however, 
projects typically average 15 to 20 years in 
duration.  The company using the facility is 
responsible for all taxes levied by state and local governments.  The arrangements between the 
issuer and the company usi ng the facility may be in 
the form of a lease.  Loans and instalment sales contracts are permissible only if the project is 
located in blighted area. Ongoing 
Nebraska Invest Nebraska 
Act Department of 
Revenue Tax Credit This law provides wage benefit tax 
credits to companies meeting 
certain minimum levels of 
investment, job cr eation, and wages 
for new employees. The credits can be earned by 
businesses in the following industries:  
research and development;  data 
processing, telecommunications, or insurance services;  financial services;  
manufacturing;  warehousing;  and 
administrative and headquarters facilities. For projects located in counties with populations of 
less than 100,000, the minimum thresholds to 
qualify for the tax credits are 25 new jobs, 
$10 million in new investment, and pay for the new jobs that is at least equal to Nebraska's 
average annual wage.  For projects located in 
counties with populations of more than 100,000, the minimum thresholds are 500 new jobs and $50 in new investment, or 250 new jobs and 
$100 million in new investment, and pay for the 
new jobs that is at least 110 per cent of the state's average annual wage.  If the average compensation 
for the new employment is under 
$20,000 annually, no credit is available.  If it is between $20,000 and $30,000, the credit is three 
per cent;  if it is between $30,000 and $40,000, it is 
four per cent; and if it is over $40,000, it is five per cent.  Ongoing 
Nebraska Nebraska 
Redevelopment 
Act Department of 
Economic 
Development Loan The programme allows cities to 
declare land within ten miles of 
their city limits blighted, thus 
property taxes on the subsequently improved property can then be used 
to reimburse companies for land 
purchase and project development.  This legislation authorizes 
Community Improvement 
Financing, also known as Tax Increment Financing, for real estate 
and equipment in a project that adds 
at least 500 new jobs and $50 million of new investment. The location would apply to designated 
blighted and substandard areas, if 
located within the following ranges:  
up to ten miles outside a metropolitan or primary class city;  up to six miles 
outside a first class city;  and up to 
three miles outside of cities of second class or a village or villages. This type of financing allows new property taxes 
from the new investment to go back to the project 
to help finance rehabilitation, acquisition and 
redevelopment costs through bonds.  Such financing would apply for 15 years.  Existing 
property taxes continue to  go for local general fund 
purposes. Ongoing 
Nebraska Rural Incentives Department of 
Economic Development Tax Credit This is a new programme aimed at 
providing tax credits to qualifying businesses in rural areas of the 
state.   For businesses expanding in counties 
with populations of 25,000 or less. The programme provides tax credits to companies 
that generate at least 5 new jobs and $250,000 of new investment in coun ties with populations of 
25,000 or less.  In order to qualify, the jobs created 
must pay at least $8.25 per hour.  The wage requirement will be indexed annually according to 
the average rural Nebraska weekly wage. Ongoing  
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Nebraska Rural Economic 
Opportunities Act Department of 
Economic 
Development Tax Credit This law provides incentives for 
employment and investment in the 
state's mid and small-sized counties. The credits can be earned by 
businesses in the following industries:  
research and development;  data 
processing, telecommunications, or insurance services;  financial services;  
manufacturing;  warehousing; and 
administrative and headquarters facilities. Projects qualify by meeting and maintaining all 
three of the following criteri a:  1) adding full-time 
equivalent employment e qual to at least 0.5 per 
cent of the county labour force in the county or counties in which the project is located, 2) paying 
higher than average wages (wages paid new 
employees must average at least 125 per cent of the average annual wage in the county or state and be 
above a regional average wa ge), and 3) investing a 
minimum of $100,000 for each required employee ($100,000 x required minimum employment).  In a 
few counties a business can earn the tax credits by 
adding no more than two new jobs and $100,000 in investment. The credits available are five per cent 
of the total paid for new employment each year for 
seven years and ten per cent of new investment 
made until the end of the seven years. Ongoing 
Nevada Revolving Loan 
Fund Commission on 
Economic 
Development Loan The Nevada Revolving Loan Fund 
(NRLF) was created to assist for 
profit businesses in need of "gap" financing to complete their business 
projects.  The Revolving Loan Fund 
derives its funds from the CDBG Programme. Low-to moderate income households 
in rural Nevada. Up to $100,000 is available for Nevada businesses 
to use to expand or start a business.  The NRLF is a 
fixed, generally below prime rate lending programme.  Payback terms can be amortized up to 
15 years.  The rate and term are set according to 
the business' ability to  repay from profits. Ongoing 
Nevada NRS 374.322 Department of 
Taxation Tax 
Exemption Certain aircraft, ai rcraft engines and 
component parts used in 
transportation are exempted from gross receipts from the sale, storage 
or other consumption Manufacturing/remanufacturing of 
aircraft engines Current state sales tax rate (rates fluctuate by 
county).   Ongoing  
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the 
Programme 
New Jersey Advanced 
Technology 
Centers New Jersey 
Commission on 
Science and 
Technology (NJCST) Grant The Advanced Technology Center 
(ATC) programme made targeted 
investments in R&D areas that were 
determined to be of importance to the major industry clusters in New 
Jersey.  ATC are multidisciplinary 
facilities on the campuses of our research universities, and are 
engaged in research and 
development activities around a specific technology area.  Each 
ATC has an industrial advisory 
board and enjoys industry sponsorship.  New Jersey's 
Advanced Technology Centers 
include:  Center for Advanced Biotechnology & Medicine;  Center 
for Advanced Information 
Processing;  Center for Ceramics and Materials Engineering;  Center 
for Photonic and Optoelectronic 
Materials;  Hazardous Substance Management Research Center;  Center for Advanced Food 
Technology;  Biotechnology Center 
for Agriculture and the Environment;  Fiber Optic 
Materials Research Programme.   Statewide.   Not available. Ongoing 
New Jersey Business 
Employment 
Incentive Program (BEIP) New Jersey 
Economic 
Development Authority Grant Legislation directs the New Jersey 
Economic Development 
Authority (EDA) to make direct payments in the form of grants to 
expanding or relocating businesses 
that will create new jobs in New Jersey.  Businesses must be 
economically viable, and 
demonstrate that the incentive grant is a material factor in their decision to locate or expand in New Jersey. Statewide- Point of final purchase 
retail facilities are not eligible for 
incentive grants.  In the base year, the 
company must create at least 75 new 
jobs in a non-targeted municipality or 
at least 25 jobs in a targeted area.  Qualifying businesses must maintain a 
project in New Jersey for at least 
1.5 times the number of years of the grant. The incentive grant, which may be for up to 
10 years, will equal 10 per cent to 80 per cent of 
the total amount of state income taxes withheld by the business during the calendar year for the new 
employees hired.  No grant monies will be 
disbursed until the Treasurer certifies that the amount of withholdings r eceived from the business 
at least equals the grant amount.  Businesses 
receiving relocation grants are not eligible unless approved by the State Treasurer.  Grant assistance from this and other programmes may not exceed 
80 per cent of a business' withholdings unless 
approved by the Treasurer.   Ongoing  
   G/SCM/N/123/USA
 Page 123State Programme Title Programme 
Authority Form of 
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the 
Programme 
New Jersey Community 
Lending Program New Jersey 
Economic 
Development 
Authority Guarantee Administered in cooperation with 
the Federal Home Loan Bank of 
New York and its New Jersey 
members.  Loans are made by a participating bank or consortium of 
banks.  EDA provides a 25 per cent 
guarantee of the loan amount for the term of the loan.   Businesses that have been in operation 
at least two years and are located in 
neighbourhoods where at least 50 per 
cent of the residents are of low or moderate income or the requested 
financing will benefit such residents 
are eligible. Loans range from $100,000 to $6 million.  The 
maximum loan is $6 million for fixed assets and 
$4 million for working capital.  EDA also may 
issue tax-exempt bonds for manufacturing companies or non-profit organizations.  The bonds 
will be backed by a letter of credit from a 
participating bank and then by the FHLB to guarantee payment.  EDA will provide a 25 per 
cent guarantee of the entire bond amount. Ongoing 
New Jersey Direct Loans Casino 
Reinvestment Development 
Authority Loan Casino Reinvestment direct loans 
for fixed assets are available to businesses in targeted 
municipalities. Urban areas in the state with an 
emphasis on Atlantic City. Interest rates on loans are negotiable. Ongoing 
New Jersey Direct Loans New Jersey 
Economic Development 
Authority Loan Businesses that are unable to get 
sufficient bank credit on their own or through the Statewide Loan Pool 
or EDA guarantee are eligible to 
apply for fixed assets and working capital.  Preference is given to 
enterprises located in an 
economically targeted area or representing a targeted business sector. Statewide.   Loans are made for up to $500,000 for fixed assets 
and up to $250,000 for working capital for a maximum term of 10 years.  The interest rate is 
equal to the federal discount rate at the time of 
approval or closing, but no lower than 5 per cent. Ongoing 
New Jersey Hazardous 
Discharge Site 
Remediation Loan 
and Grant Program New Jersey 
Economic 
Development 
Authority Mixed Businesses may qualify for loans of 
up to $1 million for up to 10 years 
for site investigation and clean up.  
Municipalities owning or holding a tax sale certificate on a property 
may apply for grants and loans of 
up to $2 million per year for investigation and remedial 
activities. Grants may be used for preliminary 
assessments, site investigation and 
remedial investigations of eligible 
sites.  Loans may be used for these purposes and for clean up of the site.  
Industrial businesses that are required 
to perform remediation activities due to a closure of operations or transfer of 
ownership or operations and do not 
have a funding source;  persons who have discharged a hazardous substance 
or are responsible for such a substance 
and do not have a funding source; and municipalities and persons who 
voluntarily undertake remediation are 
eligible to apply.   Interest shall be equal to  the Federal Discount Rate 
at time of approval or clos ing, whichever is lower, 
with a minimum of 5 per cent.  DEP charges 
administrative and oversight fees. Ongoing 
New Jersey Loan Guarantees New Jersey 
Economic 
Development Authority Guarantee Guarantees of conventional loans 
for working capital can be made for 
up to $1 million.  Guarantees of conventional loans or bond issues 
for fixed assets can be made for up 
to $1.5 million.   All industries. Guarantees can be arranged for a maximum of 
10 years, although the loan may be for longer 
periods.  Generally, guarantees are limited to 30 per cent - 50 per cent of the loan amount but 
cannot exceed the dollar limitations above.  
Guarantee fee at closing is  ½ of 1 per cent of initial 
guaranteed portion of the lo an times the number of 
years the guarantee is in effect. Ongoing  
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
New Jersey Local 
Development 
Financing Fund 
(LDFF) New Jersey 
Economic 
Development 
Authority Loan Loans ranging from $25,000 to 
$2 million may be made for 
commercial and industrial projects 
in targeted communities.  Financing is in the form of a permanent 
subordinated mortgage loan made 
at a below market rate of interest.  The municipality in which the 
business is located must sponsor the 
request for financial assistance. Projects must be located in state 
designated Urban Aid communities. There is a required minimum 1:1 public/private 
dollar match but generally the financing is limited 
to no more than 25 per cent of the project costs. Ongoing 
New Jersey Neighborhood 
Development 
Corporation (NDC) Urban 
Development 
Corporation Mixed 
Financing Provides loans, loan guarantees and 
equity investments to any for-profit 
neighbourhood development corporation to undertake projects 
that will create jobs, add capital 
assets and provide other direct benefits to the neighbourhood.  All 
available financial sources must be 
approached prior to applying for the NDCP, and project must have local support. Project (s) must be located in an 
eligible municipality, i.e., one which 
has at some time been eligible for Urban Aid or Depressed Rural Centers 
Aid as determined annually by the 
New Jersey Department of Community Affairs. Maximum direct loan is the lesser of $500,000 or 
50 per cent of total eligible project costs.  
Maximum loan amortization is 20 years. Ongoing 
New Jersey Underground 
Storage Tank 
Loans New Jersey 
Economic 
Development 
Authority Loan The EDA and Department of 
Environmental Protection jointly 
administer a fund to make loans and 
grants available to eligible owners and operators of regulated oil tanks 
to help finance costs associated 
with the upgrade, closure and remediation of tanks.  Hardship 
grants not to exceed $250,000 are 
available to owners/operators for 100 per cent of the project costs.  
Grant amount is based on the 
portion of costs EDA determines the applicant cannot reasonable 
expect to pay. Eligible business owners are those who 
own or operate less than 10 petroleum 
underground storage tanks in New 
Jersey;  have a net worth of less than $2 million, and ca n demonstrate the 
inability to obtain a commercial loan 
for all or a portion of the eligible costs.To qualify for hard ship grants, the 
applicant must have a taxable income 
of less than $100,000 or net worth, exclusive of applicant's primary 
residence, of less than $100,000.  A 
business grant must recipient must stay in business 15 years after the award or 
a prorated portion of the grant must be 
repaid. Up to 100 per cent of eligible costs.  Loans cannot 
exceed $1 million per facility.  The interest rate is 
determined by EA and may range from 2 per cent 
to the Primate Rate.  Lo an term may not exceed 
10 years. Ongoing 
New Jersey Urban Centers 
Small Loan 
Program New Jersey 
Economic 
Development Authority Loan Existing retail and commercial 
businesses located in the 
commercial district of an urban targeted municipality may obtain 
financing to fix up their properties.   Existing retail and commercial 
businesses located in the commercial 
district of an urban targeted municipality.   Loans range from $5,000 - $50,000 for a maximum 
term of 10 years at an interest rate of 1 per cent 
below the federal discount rate with a floor of 4 per cent and a ceiling of 10 per cent.   Ongoing  
   G/SCM/N/123/USA
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Programme 
New Jersey Urban Enterprise 
Zone Program Department of 
Commerce and 
Economic 
Development Mixed Tax New Jersey has 27 Urban 
Enterprise Zones which provide 
significant incentives and benefits 
to businesses that locate within the zones.   New Jersey has 27 Urban Enterprise 
Zones which provide significant 
incentives and benefits to businesses 
that locate within the zones.   Qualified retailers may charge 50 per cent of New 
Jersey sales tax on "in person" purchases;  sales tax 
exemptions for materials and for tangible personal 
property.  Other zone benefits include:  a one-time corporation tax credit of $1,500 for the full-time 
hiring of residents of a city where a Zone is located 
who have been unemployed or dependent upon public assistance for at least 90 days, or a 
corporation tax credit of $500 for hiring residents 
within the Zone, within a nother Zone or within a 
qualifying municipality;  subsidized 
unemployment insurance costs, for certain new 
employees an incentive tax credit of 8 per cent of investment in the Zone by an approved "in lieu" 
agreement for certain eligib le firms;  and priority 
for financial assistance from New Jersey Local Development Financing Fund and Job Training 
Program.   Ongoing 
New Jersey Technology 
Business Tax 
Certificate Program New Jersey 
Economic 
Development Authority Tax 
Incentives Approved businesses may sell their 
unused net-operation-loss carry 
forwards and unused research and development tax credit carry 
forwards to any corporate taxpayer 
in the state for at least 75 per cent of the value of the tax benefits.  
They can then use the money raised 
for working capital to buy equipment or facilities or for other 
business expenses.   Technology or biotechnology 
businesses must have 225 employees 
or less, of whom at least 75 per cent must be based in New Jersey, and meet 
certain other criteria. Not available. Ongoing 
New Jersey New Jersey Seed 
Capital Program New Jersey 
Economic 
Development Authority Loan This programme is designed to fill 
financing gaps in the availability of 
seed capital for growing technology-based companies.  Technology-based companies.   Loans range from $25,000 to $50,000.   Ongoing 
New Jersey New Jersey 
Technology Funding Program New Jersey 
Economic Development 
Authority Loan Term loans for second-stage 
technology companies. Second-stage technology companies.   The EDA participates with commercial banks to 
make term loans up to $5 million.  The EDA's direct participation may be up to $500,000 for 
working capital or fixed assets.  It will also 
consider up to a 50 per cent guarantee of the bank's portion of the financing.  Ongoing 
New Mexico Aerospace 
Research and 
Development 
Deduction New Mexico 
Taxation and 
Revenue 
Department Tax 
Abatement/
Reduction The Aerospace Research and 
Development tax deduction was 
implemented to stimulate economic 
development by providing an incentive for research and 
development service providers to 
operate in New Mexico. Aerospace Industry.   Maximum Programme Benefits:  A portion of 
gross receipts tax is deduc tible increasing over four 
years to 100 per cent by 1999. Ongoing  
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Authority Form of 
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the 
Programme 
New Mexico Enterprise Zones Economic 
Development 
Department Mixed Tax Municipalities, counties and Indian 
reservations can designate an 
eligible area as an enterprise zone.  
The area must exhibit general distress such as:  high levels of 
unemployment, deterioration of 
residential and commercial structures, poverty and other 
distress criteria.  Before a 
jurisdiction can designate an area, a comprehensive strategic plan must 
be developed with grassroots 
involvement.  The programme is non-competitive. Statewide, distressed areas.   Maximum Programme Benefits:  $50,000 tax 
credit to property owners for the rehabilitation of 
qualified business facilities;  Fast tracking of-
infrastructure projects;  Tax increment method of financing local enterprise zone projects;  Local 
property tax abatement for 10 years on selected 
property;  Building rehabilitation tax credit up to $50,000;  Special CDBG funds for infrastructure 
grants and low-interest economic development 
loans;  Technical assistance is available through workshops and one on-one meetings to assist local 
governments in coordinating their targeted 
development efforts;  and 65 per cent in-plant training reimbursement for qualified businesses.   Ongoing 
New Mexico Filmmaker's Gross 
Receipts Tax Incentive Tax Information 
Office Tax 
Exemption Qualified production companies 
filming in New Mexico may purchase certain services and 
materials and not pay the State's 
gross receipts tax on such services and materials.   Film Industry A qualified production company may execute non-
taxable transaction certificates with its suppliers for tangible personal property or services.  The 
suppliers may then deduct their receipts from the 
gross receipts tax. Ongoing 
New Mexico Industrial 
Development 
Training Program NM Economic 
Development  
Department Grant The Industrial Development 
Training Program pays up to 50 per 
cent (or 65 per cent rural) of 
employee training costs and wages for an expanding or relocating 
business for up to a six month 
period.  Training may be provided by a state educational institution or tailored to meet specific business 
needs.  Trainees must be residents 
of New Mexico and guaranteed full-time employment after training.  
The programme is a cooperative 
effort of the Economic Development Department, the 
Department of Public Education, 
the Department of Labor, the Commission on Higher Education 
and private industry. In rural areas, wages are reimbursed at 
a higher rate (60 per cent). Maximum Programme Benefits:  Trainee wages 
are reimbursed to the company at 50 per cent 
during hours of training.   Trainee hours will not 
exceed 1,040 hours per trainee based on the business work week, not to exceed 40 hours per 
week.  Trainer costs, excluding business 
employees, are reimbursed to the business at 50 per cent of the trainer's travel and per diem.   Instructional costs involving classroom training 
will be reimbursed to the educational institution at 
100 per cent of all costs outlined in the training contract.  Costs may include instructional salaries, 
fringe benefits, supplies and materials, textbooks, 
expendable tools and other costs associated with 
conducting the training.  All costs must be 
necessary and reasonable. Ongoing 
New Mexico New Mexico 
Property Tax Abatement Tax Information 
Office Tax 
Exemption Real and tangible personal property 
is assessed and taxes are collected at the local level. Statewide - Land, buildings and 
equipment associated with an eligible project to promote economic 
development. Maximum Programme Benefits:  Land, buildings 
and equipment associated with an eligible project are exempt from ad valorem tax, generally to 
promote economic development. 
Term:  Up to 30 years.   Rate:  Varies by community.   Ongoing  
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Programme 
New Mexico Preferential Tax 
Rate for Small 
Wineries and 
Breweries New Mexico 
Taxation and 
Revenue 
Department Tax 
Abatement 
or 
Reduction Preferential tax rate for small 
wineries and breweries. Winery/brewery.   Maximum Programme Benefits:  Wine produced 
by a small winery carries a tax of 10 cents per litre 
on the first 80,000 litres;  20 cents on production 
over that level.  The basic tax rate for wine is 45 cents per litre.  Beer produced by a microbrewery 
is taxed at 25 cents per gallon.  The basic tax rate 
for beer is 41 cents per gallon.   Ongoing 
New Mexico Rural 
Development Direct Business 
and Industry Loan 
Program Rural 
Development Loan Loans to privat e entrepreneurs.   Rural communities under 
50,000 population.  Funding is targeted to projects located in New Mexico's 
Champion Communities and the La 
Jicarita Enterprise Community. Maximum Programme Benefits: $500,000 budget.  
Interest:  Currently 8.25 per cent and subject to change on a quarterly basis.   Ongoing 
New Mexico Tax Increment 
Financing New Mexico 
Taxation and 
Revenue Department Loan Tax increment financing is a 
mechanism for raising funds for 
economic development purposes.  At the beginning of a project, the 
valuation of the project properties is 
summed.  As the project proceeds, these properties are developed or 
otherwise improved, increasing 
their valuations.  The tax proceeds flowing from the increase in 
valuation may be diverted to 
finance the project.   Tax increment financing in New 
Mexico is available only in a 
designated enterprise zone.   Not available. Ongoing  
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Authority Form of 
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the 
Programme 
New York Direct Loan 
Program Job 
Development 
Authority Loan This programme, funded through 
the sale of state guaranteed bonds 
and notes, provides tax-exempt (if 
eligible pursuant to applicable federal law) or taxable bond 
proceeds.  These bond proceeds 
provide financing for the growth of manufacturing and other private 
businesses in New York State, in 
cooperation with Local Development Corporations (LDCs) 
and other Federal and State 
agencies.  Financing may be used for the acquisition of land, 
structures, machinery and 
equipment;  construction, modernization, and renovation of 
existing facilities and sites;  Loans 
may be used to purchase new or used machinery and equipment 
used in New York State;  Fixed and 
variable interest rates on direct loans for machinery and equipment secured by a first priority lien (may 
be co-equal with a participating 
lender) on the underlying assets, and second mortgage loans for real 
estate acquisitions, construction, or 
renovations;  No interim or construction financing;  Real estate 
loans for terms up to 20 years, and 
machinery and equipment loans for terms up to 10 years or the useful 
life of the collateral, whichever is 
less. Eligible recipients include small and 
medium-sized businesses in 
manufacturing, distribution, 
warehousing, and certain service industries.  Retail, hotel, or residential 
facilities, real estate and media/film 
organizations, professional corporations, personal service,  
medical organizations, and loans for 
rolling stock, motor vehicles, or waterborne craft are not eligible.  
Projects must show that they anticipate 
creating or retain one job for every $35,000 of programme assistance. A typical JDA assisted financing structure is:  
50 per cent private or public participating co-
lender, 40 per cent JDA, and 10 per cent equity 
contribution of loan recipient.  Loans are secured by a second lien on the commercial property (but 
subordinate to no more than 50 per cent of project 
cost) and a proportionally co-equal first lien position with other lenders for machinery and 
equipment.  Direct loans of $50,000 to $1,500,000 
or no more than 40 per cent of total eligible project 
cost (up to 60 per cent in some cases, including 
projects in economically distressed areas) Ongoing  
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Authority Form of 
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Programme 
New York Empire Zone Real 
Property Tax 
Exemption (RPTL 
485-e) New York State Tax 
Exemption If allowed by local option, real 
property that (1) is located in a 
designated empire zone (formerly 
known as an economic development zone) and (2) is 
constructed or improved after the 
zone is designated is partially exempt from taxation and special ad 
valorem levies for up to 10 years, 
but is liable for special assessments.  The amount of exemption is limited 
to a percentage of the increase in 
assessed value attributable to the construction or improvement as 
determined in the first year of 
exemption.  The increase in assessed value ("base amount") 
used to calculate the amount of 
exemption remains constant throughout the term of exemption, 
except (1) where there is 
subsequent construction or improvement during the term of exemption or (2) wh ere there occurs 
in the assessing unit an overall 
change in the level of assessment of 15 per cent or more; in either case 
the base amount must be adjusted.   Property must be located in an empire 
zone identified as such by the State 
Empire Zones Designation Board 
(administered by the New York State Department of Economic 
Development).   The amount and duration of the exemption depends 
upon whether the taxing jurisdiction has adopted a 
fixed 10-year term for the exemption (see Local 
Option below).  If the taxing jurisdiction has adopted a fixed 10-year term, then 100 per cent of 
the base amount is exempt during the first 7 years 
of the exemption, 75 per cent is exempt in the 8
th year, 50 per cent is exempt in the 9th year, and 
25 per cent is exempt in the 10th year.  If the 
taxing jurisdiction has not adopted a fixed 10-year term, then the exemption will end in the 10th year 
of the zone's life, and the exemption percentages 
will likewise be tied to the zone's life.   Ongoing 
New York Empire Zones 
Program Empire State 
Development Mixed Tax Empire Zones (EZs) of one to two 
square miles each have been 
designated in 56 distressed communities around the state.  Each 
of these zones has tax credits 
available to businesses for the duration of the zone designation.  
Zone Equivalent Areas are defined 
by the census tract as locations with high poverty and high unemployment that have not been 
designated as Empire Zones.  
Businesses locating in these areas have special benefits.   
Businesses that expand or locate in 
Empire Zones or Zone Equivalent Areas of New York State may be 
eligible to receive substantial 
financial incentives for investment and/or job creation. Property must be located in an empire 
zone identified as such by the State 
Empire Zones Designation Board (administered by the New York State 
Department of Economic 
Development). Within Empire Zones, financial incentives include:  
(1) Investment tax credit (2) Wage tax credit (3) 
Zone capital tax credit (4) New York State sales tax refund (5) Utility rate reduction (6) Real 
property tax exemption (7) Local sales tax refund 
(8) Energy incentives are available to eligible 
businesses that locate or are established in EZs.  
These include gas and electric utilities rate 
reductions.  Many utilities offer certain EZ certified businesses rate reductions of 3 per cent to 60 per cent for new load.  Telephone rate 
reductions of 5 per cent for the life of the EZ on 
intrastate-intralata charges are available to certified businesses that use NY Telephone or GTE;  rate 
reductions of 5 per cent are also available to 
certified businesses from NYNEX and Citizens Telecom.  Within Zone Equivalent Areas, financial 
incentives which may extend to 31 December 
2004, include the wage tax credit.   Ongoing  
  G/SCM/N/123/USA 
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
New York Empowerment 
Zone Program New York 
Empowerment 
Zone 
Corporation (NYEZC) Mixed 
Financing Established by the Revenue 
Reconciliation Act (1993), this is a 
Federal initiative to stimulate 
economic growth in severely distressed areas through tax 
incentives and incentive financing. 
The New York State Empowerment Zone (EZ) consists of East, Central 
and West Harlem, portions of 
Washington Heights, and the South Bronx.  New York State and New 
York City each have committed 
$100 million over the next 10 years to match the Federal commitment 
for a total of $300 million.  
Financing is available for the purchase of qualified zone property 
and land used for related purposes 
in the zones.   Qualified businesses are generally any 
trade except those consisting primarily 
of the development or holding of 
intangibles for sale or license, golf courses, country clubs, massage 
parlours, hot tub or suntan facilities, 
racetrack/gambling facilities, liquor stores, or farms with assets greater than 
$500,000 at close of tax year. Triple tax exempt enterprise zone facility bond 
financing at lower than market interest rates;  Total 
outstanding EZ facility bonds allocated to any 
person cannot exceed $3 million per zone or $20 million for all zones nationwide;  At least 
95 per cent of the net pr oceeds of the bond issue 
must be used to finance qualified zone property. Ongoing 
New York Energy Products 
Center New York State 
Energy R&D 
Authority Marketing 
Assistance 
and Financial 
Assistance To promote more efficient and 
clean supplies of energy.  Businesses involved with a technology, 
product, or service that generates new 
supplies of energy more efficiently and cleanly.  In order to receive a loan, 
persons should be a customer of one of 
the following utility companies:  Central Hudson Gas & Electric 
Corporation, Consolidated Edison 
Company of New York, New York State Electric & Gas Corporation, 
Niagara Mohawk Power Corporation, 
or Orange and Rockland Utilities, Inc.  Customers must have identified an 
eligible improvement project, have the 
necessary documentation and a loan commitment from a participating 
lender. Up to $500,000 of project cost may be funded, 
with 50 per cent co-funding.  Project funding is 
budgeted in advance by programme topic and specific in each "Program Opportunity Notice".  
The programme money is allocated among the 
chosen projects.  New York State lenders provide loans with an interest ra te of 4.5 per cent.  The 
average cost of a project being funded is up to 
$200,000.   Ongoing  
   G/SCM/N/123/USA
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Authority Form of 
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Programme 
New York Enterprise 
Communities Empire State 
Development Mixed 
Financing Sixty-five Federal Enterprise 
Communities ("ECs") were 
designated by the US Department 
of Housing and Urban Development (HUD) at the end of 
1994, through the Revenue 
Reconciliation Act (1993).  Four ECs are located in New York State:  
Buffalo, Rochester, Albany-
Schenectady-Troy, Kingston-Newburgh.  To stimulate economic 
growth in distressed areas, each 
community receives $2,947,368 over two years in 
Federal Social Security Block 
Grants.  New York State committed to match the Federal awards, for a 
total of $5,894,736 per EC. Qualified businesses must be located 
within an Enterprise Community.  
Sixty-five Federal Enterprise 
Communities ("ECs") were designated by the US Department of Housing and 
Urban Development (HUD) at the end 
of 1994, through the Revenue Reconciliation Act (1993).  Four ECs 
are located in New York State:  
Buffalo, Rochester, Albany-Schenectady-Troy, Kingston-
Newburgh.  Financing is also available for the purchase of 
qualified enterprise zone property through 
qualified Enterprise Zone Facility Bonds:  Triple 
tax-exempt enterprise z one facility bond financing 
at lower than market interest rates;  At least 95 per 
cent of the net proceeds of  the bond issue must be 
used to finance qualified EC property;  Total outstanding Enterprise Zone Facility Bonds 
allocated to any business cannot exceed $3 million 
per EC or $20 million for all ECs.   Ongoing 
New York General 
Development 
Financing Empire State 
Development Loan Assistance for projects that create 
or retain jobs or increase business 
activity undertaken by 
manufacturing, non-retail service firms, headquarters facilities of 
firms engaged in retail industries, 
retail firms located in distressed areas, and businesses which 
develop recreational, cultural, or 
historical facilities for tourist attraction.  (For a list of designated 
distressed areas in NYS, contact 
ESD Economic Revitalization). Eligible projects create or retain jobs or 
increase business activity undertaken 
by manufacturing, non-retail service 
firms, headquarters facilities of firms engaged in retail industries, retail firms 
located in distressed areas, and 
businesses which develop recreational, cultural, or historical facilities for 
tourist attraction. Loans of $75,000 to $2,000,000 for up to 40 per 
cent of total project cost at interest rates no lower 
than 3 per cent and terms up to 20 years for real 
property and up to 7 years for machinery and equipment.  Interest rates on loans will be set at the 
time of Directors' approval of project application;  
rates will reflect market conditions, applicant's ability to repay, and requirements necessary to 
make the project feasible, but will not generally be 
lower than 3 per cent.  Loan guarantees of $75,000 to $2,000,000 or up to 60 per cent of the total 
credit facility, whichever is less.  Interest subsidy 
grants of $75,000 to $500,000 for up to 5 years;  grants may not reduce the effective interest rate 
below 3 per cent.  Capital Grants may also be 
available for hard costs and related soft costs, as well as for working capital.   Working capital loans 
for amounts to be determined on a case-by-case 
basis for capital-related expenses such as accounts receivable and inventory.  Loans and loan 
guarantees for terms up to four years.   Ongoing 
New York Long-Term 
Economic 
Development 
Fund Job 
Development 
Authority Loan This programme provides fixed 
asset financing to eligible projects 
in rural areas of the state 
experiencing long term economic decline or sudden and severe job 
losses. Applicants must be private businesses 
located in rural or distressed areas of 
the state and in communities with 
population under 25,000, or in counties that are not within a Standard 
Metropolitan Statistical Area, or in 
counties with fewer than 150 people per square mile.  Exceptions may be 
made on a case-by-case basis.   Loans of up to one-third of total project cost or a 
maximum loan of $150,000 per project.  Interest 
rate on loans is the prime rate minus 3 per cent, 
fixed at the time of closing, with a minimum rate of 5 per cent and maximum rate of 10 per cent. Ongoing  
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Page 132 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
New York Metropolitan 
Economic 
Revitalization 
Fund Empire State 
Development Loan Financing for projects that retain or 
create significant numbers of 
private sector jobs in economically 
distressed areas.  Applicants may be both for-profit and not-for-profit 
businesses or village, town, city, or 
county governments that invest in economically distressed areas of 
New York State that fall within the 
service area of the Port Authority of New York and New Jersey.  These 
areas include New York City and 
parts of Nassau, Westchester, and Rockland counties.   Eligible businesses should retain or 
create significant numbers of private 
sector jobs in economically distressed 
areas.  Applicants may be both for-profit and not-for-profit businesses or 
village, town, city, or county 
governments that invest in economically distressed areas of New 
York State that fall within the service 
area of the Port Authority of New York and New Jersey.  These areas include 
New York City and parts of Nassau, 
Westchester, and Rockland counties. Loans of up to a maximum of $5,000,000, or 
10 per cent of total project cost, whichever is less, 
for acquisition or improvement of land and/or 
buildings, construction and renovation, and for machinery and equipment purchases.  A minimum 
of 10 per cent borrower equity required.  Interest 
rates will be determined by market conditions, applicant's ability to repay, and project 
requirements, and set at the time of ESD Directors' 
approval.  Terms for project loans will not exceed 20 years for real estate and 7 years (or useful life of 
collateral) for machinery and equipment. Ongoing 
New York Motion Picture 
and Television 
Development 
Assistance Governor's 
Office for 
Motion Picture 
and Television Development Business 
assistance The Governor's Office for Motion 
Picture and Television 
Development promotes and 
encourages the location and expansion of motion picture, 
television, commercial, video and 
related pre- and post-production and distribution businesses in New 
York State. In addition, the Office 
works with the theatre and New Media industries.  This is 
accomplished through a variety of 
business assistance and marketing programmes, and review of 
regulatory and tax policy.  Free 
services offered by this unit include:  Marketing and servicing 
for the whole state.  MP/TV not 
only provides complete service and support, but also coordinates with a 
network of local film offices, 
Visitors' and Convention Bureaus, and industry liaisons;  Location services:  scouting, research and 
access to a location library with 
over 10,000 images of locations.  The programme promotes and 
encourages the location and 
expansion of motion pictures, television, commercial, video and 
related projects.   Film Industry.   Not available. Ongoing  
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Authority Form of 
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the 
Programme 
New York Qualified 
Emerging 
Technology 
Company (QETC) Tax Credits New York State Tax Credit Two new credits for emerging 
technology companies:  1.  
Qualified Emerging Technology 
Employment Credit 2.  Qualified Emerging Technology Company 
Capital Tax Credit.   A qualified emerging technology 
company is, pursuant to section 3102-e 
of the Public Authorities Law (PAL), a 
company located in New York State that has total annual product sales of 
$10 million or less, and meets either of 
the following criteria:  (1) its primary products or services are classified as 
emerging technologies under section 
3102-e(1)(b) of the PAL;  or (2) it has research and development activities in 
New York State and its ratio of 
research and development funds to net sales equals or exceeds the average 
ratio for all surveyed companies 
classified (as determined by the National Science Foundation (NSF) in 
the most recently published results 
from its Survey of Industry Research and Development, or a comparable 
successor survey as determined by the 
Tax Department). Not available. Ongoing 
New York Qualified Empire 
Zone Enterprise 
Incentives Empire State 
Development/Ne
w York State Department of 
Tax and Finance Tax Credit Empire Zone- certified businesses 
locating and increasing employment 
in Empire Zones ("Qualified Empire Zone Enterprises" or 
QEZEs) may be eligible for 
enhanced sales, property and business tax credits which may 
permit them to operate on a virtual 
"tax-free" basis for up to 10 years, with additional savings available on 
a declining basis in years 11 
through 14.  These enhanced benefits include: Sales Tax 
Exemptions;  QEZE Credit for Real 
Property Taxes;  QEZE Tax Reduction Credit.   All qualified businesses located in a 
New York enterprise zone. Not available. Ongoing  
  G/SCM/N/123/USA 
Page 134 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
New York Rural 
Development 
Loan Fund Job 
Development 
Authority Loan ESD provides financing for small 
new and existing business 
development in rural and distressed 
areas of the state. Applicants must be private businesses 
located in rural and distressed areas of 
the state, in communities with 
population under 25,000, or in counties that are not within a Standard 
Metropolitan Statistical Area, or in 
counties with fewer than 150 people per square mile.   Loans of $20,000 to $50,000 or up to 20 per cent 
of total project cost, whichever is less.  Interest rate 
on loans is the prime rate minus 3 per cent and 
fixed at the time of closing, with a minimum 5 per cent and maximum of 10 per cent. Ongoing 
New York Tax Exemptions 
on Real Property in New York City 
Industrial and 
Commercial Incentive Program 
(ICIP) New York City 
Department of Finance Tax 
Exemption Under New York City's Industrial 
and Commercial Incentive Program (ICIP), industrial or commercial 
construction or reconstruction in 
designated areas of New York City may be eligible for an exemption or 
an abatement from the payment of 
real property taxes. Designated areas of New York City. Exemption:  Renovation a nd new construction of 
industrial properties citywide are eligible to receive a 25-year real estate tax exemption consisting of a 
full exemption on increases in the assessed value 
solely attributable to the improvements made for the first 16 years, declining by 10 per cent per year 
for the remaining nine years.  These projects may 
also receive protection against future increases on the improvement due to inflation for the first 
13 years of the benefit period.  The minimum 
required expenditure is 10 per cent of the assessed value of the project.  
Abatement: In addition to the exemption 
programme described a bove, renovation and new 
construction of industrial properties citywide are 
also eligible to receive a 12-year real estate tax 
abatement based on the pre-existing real estate taxes of the assessed value of both the land and the 
building for the tax year preceding the issuance of 
the building permit;  or, if no building permit is required, the start of construction for the first four years.  The abatement is 50 per cent for the first 
four years, declining by 10 per cent every other 
year for the remaining eight years.   Ongoing 
New York Zone Equivalent 
Areas Empire State 
Development Tax Credit Businesses employi ng individuals 
in areas that meet EZ eligibility criteria, but were not so designated 
(zone equivalent areas, or ZEAs), 
may take the Wage Tax Credit for wages paid for full-time 
employment in jobs created in the 
ZEA.  The credit is the same as the EZ-Wage Tax Credit:  $3,000 per 
targeted employee;  $1,500 per non-
targeted employee;  available for one 5-year period.  Taxpayers may 
carry unused credits forward 
indefinitely.  The ZEA programme expires in 2004.   Businesses employing individuals in 
areas that meet EZ eligibility criteria, but were not so designated (zone 
equivalent areas, or ZEAs), may take 
the Wage Tax Credit for wages paid for full-time employment in jobs 
created in the ZEA.   For tax years 2001 and beyond, the credit amounts 
increase to $3,000 for targeted employees and $1,500 for non-targeted employees, and these 
amounts remain the same throughout the entire 
five-year duration of the credit.  Also starting in 2001, taxpayers may take the credit during a ten-
year period following designation as a ZEA.  The 
total wage tax credit cannot exceed 50 per cent of tax due before credits.  Corporation franchise 
taxpayers, banks, insurance companies, and 
personal income taxpayers may claim this credit. Ongoing  
   G/SCM/N/123/USA
 Page 135State Programme Title Programme 
Authority Form of 
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Programme 
North Carolina Jobs Creation Tax 
Credit Department of 
Commerce Tax Credit North Carolina provides a Tax 
Credit for creating jobs in all 
100 counties.  Counties are 
arranged by Enterprise Tier Areas, and the credit is valued according to 
the area tier factor.  Eligible 
companies must maintain a threshold of at least 5 jobs before 
any firm begins counting jobs for 
credit.  Credit is taken in equal instalments over the four years 
following the taxable year in which 
a job is created.   The jobs tax credit is available to firms 
in the NAICS categories of 
manufacturing and processing (31-33), 
warehousing (493110), wholesale trade and distribution (42), data processing 
(54151), air courier service (492110), 
electronic mail order (454110), customer service centre (561422) and 
central administrative office (551114).  
NAICS codes are designated by the Employment Security Commission.   The size of the tax credit is based on the location of 
the firm.  Enterprise Tier Areas are designated each 
December by the Secretary of Commerce based on 
the rankings of all areas by unemployment, per capita income and population growth.  The credit 
for Tier 1 counties (23 most distressed counties) is 
$12,500;  Tier 2 counties (next 15 counties) is $4,000;  Tier 3 counties (next 25 counties) is 
$3,000;  Tier 4 counties (next 17 counties) is 
$1,000 and Tier 5 counties (next 20 counties) is $500.  There is a 5 year carry forward available for 
any unused credits.  The Jobs Tax Credit 
(including carry forwards) may not exceed 50 per cent of the tax against which it is claimed, reduced 
by the sum of all other cr edits allowed against that 
tax, excluding payments made by the taxpayer.  Either the income tax or franchise tax may be 
elected, but not both. Ongoing 
North Carolina Machinery and 
Equipment 
Investment Tax 
Credit Department of 
Commerce Tax Credit This tax credit is available to 
eligible companies that invest in 
machinery and equipment.  The tax 
credit is equal to the investment amount of machinery and 
equipment minus the applicable 
threshold, multiplied by 7 per cent.  The credit is taken in 7 equal instalments following the taxable 
year in which the machinery and 
equipment is placed in service. Eligible Companies are manufacturing, 
processing, warehousing, distribution, 
data processing, air courier service, 
electronic mail order, central administrative office as defined in 
NAICS codes.  A company's NAICS 
code must be in one of the categories listed above.  NAICS codes are designated by the Employment 
Security Commission. The size of the tax credit is based on the location of 
the firm.  The threshold for:  Tier 1 counties is $0;  
Tier 2 counties is $100,000;  Tier 3 counties is 
$200,000;  Tier 4 counties is $500,000 and Tier 5 counties is $1,000,000.  A five-year carry forwards 
is available for any unused credits.  The credit 
(including carry forwards) may not exceed 50 per cent of the tax against which it is claimed, reduced by the sum of all other cr edits allowed against that 
tax, excluding payments made by the taxpayer.  
Either the income tax or franchise tax may be elected, but not both.  If the machinery and 
equipment are moved out of the state during the 
seven year period, future credits are forfeited.  If the machinery and equipment are moved to a 
different tier during the seven year period, 
remaining instalments allowed to extent which would have been allowed if initially placed in 
service in the new tier.   Ongoing  
  G/SCM/N/123/USA 
Page 136 State Programme Title Programme 
Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
North Carolina North Carolina 
Biotechnology 
Center North Carolina 
Biotechnology 
Center Grant The NC Biotechnology Center 
promotes biotechnology research, 
development, job training and 
commercialization for statewide economic benefit.  The Center has 
four grant programmes that support 
basic research, information sharing, educational enhancement and job 
training and infrastructure 
development at the state's universities.  Academic Research 
Initiation Grants provide seed 
funding for biotechnology-related research projects that promise 
practical benefits.  The Center has 
two loan programmes that encourage technology transfer and 
research and development efforts in 
the state's biotechnology companies.  The Economic 
Development Finance Program 
provides financial assistance to companies to promote the initiation and expansion of commercial 
applications of biotechnology.  The 
Small Business Innovation Research (SBIR) Matching Fund 
Program provides financial 
assistance to small biotechnology companies that have successfully 
competed for funding under the 
federal SBIR programme. Awards are made to North Carolina 
academic institutions, non-profit 
organizations, or businesses.  In the 
case of awards to businesses, the awardee must agree to maintain a 
significant presence in North Carolina 
for five years from the effective date of the award or to repay the Center in full. Economic Development Finance Program loans are 
available for up to $250,000 for 18 months of 
support.  The SBIR Matching Fund Program 
provides up to $50,000 for research and development activities that refine Phase I research 
and initiate work on Phase II project objectives.   Ongoing  
   G/SCM/N/123/USA
 Page 137State Programme Title Programme 
Authority Form of 
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Programme 
North Carolina One North 
Carolina Fund Commerce 
Finance Center Grant Provides "financial assistance to 
those businesses or industries 
deemed by the Governor to be vital 
to a healthy and growing State economy and that are making 
significant efforts to expand in 
North Carolina".  The fund currently consists of nonrecurring 
appropriations made by the General 
Assembly, intended to be immediately available for 
companies seeking to undertake 
new expansion or locate new operations in the state.  The 
immediacy of the fund allows the 
Governor to distribute grants on an "as-needed" basis, which ensures 
the Fund's flexible application and 
speedy distribution. For a company to be considered for a 
grant from the Fund, the company 
must agree to meet the weighted hourly 
average wage test as required for the William Lee Act (Senate Bill 115 § 
105-129.4) and local units of 
government (city or county) must have agreed to provide matching financial 
assistance to the company.   Companies receive money from the Fund for the 
purposes of installation or purchase of equipment;  
structural repairs, improve ments, or renovations of 
existing buildings to be used for expansion;  construction of or improvements to new or existing 
water, sewer, gas or electric utility distribution 
lines, or equipment for existing buildings.   Ongoing 
North Carolina Worker Training 
Tax Credit Department of 
Commerce Tax Credit Firms eligible for the jobs creation 
tax credit or the machinery and 
equipment tax credit can take a credit of 50 per cent (up to 
$500 credit value for each 
employee trained in Tier 2-5 counties) against eligible training 
expenses if the firm provides 
training for 5 or more employees.  If the firm is located in Tier 1, the 
maximum credit is $1000 per 
employee. Eligible Companies are manufacturing, 
processing, warehousing, distribution, 
data processing, air courier service, electronic mail order, central 
administrative office as defined in 
NAICS codes.  A company's NAICS code must be in one of the categories 
listed above.  NAICS codes are 
designated by the Employment Security Commission. There is a 5 year carry forward available for any 
unused credits.  The credit (including carry 
forwards) may not exceed 50 per cent of the tax  against which it is claimed, reduced by the sum of 
all other credits allowed against that tax, excluding 
payments made by the taxpayer.  Either the income tax or franchise tax may be elected, but not both. Ongoing 
North Carolina Economic 
Incentive for 
Computer Manufacturing 
Companies Department of 
Commerce Grants/Tax 
Incentives To encourage high-technology 
development and create jobs within 
the state of North Carolina. Computer manufacturing companies.   For each year in which the company meets the 
required performance targets, the state will provide 
a grant equal to 75 per cent of the state personal income withholding taxes derived from the 
creation of new jobs.  Over the next 
15-20 years 
North Dakota Regional Rural 
Development 
Revolving Loan Fund North Dakota 
Development 
Fund Mixed 
Financing Programme provides flexible "gap 
financing" to make projects 
bankable through subordinated debt, equity and partnerships. This fund is allocated equally among 
the state's eight economic regions for 
projects located more than five miles outside the limits of a city with a population less than 8,000. Maximum investment $300,000.  Debt and equity 
investments are priced based upon the appropriate 
risk/return.  Debt averages:  working capital 3-5 years, machinery/equipment 5-7 years, commercial real estate 10-25 years.  Equity 
averages:  5-10 years.  In ternal rate of return 
negotiated on case by case basis. Ongoing  
  G/SCM/N/123/USA 
Page 138 State Programme Title Programme 
Authority Form of 
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the 
Programme 
North Dakota Income Tax Credit 
for Agricultural 
Processing 
Facility Investment Tax Department 
/ Commerce 
Department's 
Division of Economic 
Development 
and Finance Tax Credit North Dakota offers business a 
favourable tax climate that 
promotes growth and opportunity 
through traditional tax incentives and innovative new opportunities. An individual, estate, trust, partnership, 
corporation, or limited liability 
company is allowed an income tax 
credit for investing in an agricultural 
commodity processing facility in North 
Dakota that is certified by the 
Commerce Department's Division of Economic Development and Finance. 
In the case of a pass-through entity, 
such as a partnership or corporation, the credit is passed through to the 
entity's owners based on their 
respective ownership interests.   The credit is equal to 30 per cent of the investment, 
up to a maximum credit of $50,000 per year.  A 
taxpayer is allowed no more than $250,000 in 
credits for all tax years.  Not more than 50 per cent of the credit is allowed in  any year.  The credit in 
any year may not exceed 50 per cent of the tax 
liability.  An unused credit may be carried forward up to five years.   Ongoing 
North Dakota Sales & Use Tax 
Exemptions for Agricultural 
Processing Plant 
Construction Materials Tax Department Tax 
Exemption North Dakota offers business a 
favourable tax climate that promotes growth and opportunity 
through traditional tax incentives 
and innovative new opportunities. Construction materials used to 
construct an agricultural processing facility are exempt from sales and use 
taxes.  The processor must apply to the 
State Tax Commissioner for a refund of the tax paid by a contractor.  As defined by the sales tax exemption, a 
qualifying agricultural commodity 
processing facility means a processing facility for the processing or 
production of marketable products 
from agricultural commodities. The sales tax exemption, if applicable, will provide 
a five per cent sales tax exemption based on the cost of construction materials for a qualifying 
agricultural commodity processing facility.   Ongoing  
   G/SCM/N/123/USA
 Page 139State Programme Title Programme 
Authority Form of 
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Programme 
North Dakota Tax Incentives for 
Real Property 
Purchasing, 
Leasing or Improvements in 
Renaissance 
Zones Tax Department 
/ Commerce 
Department's 
Division of Community 
Services Mixed Tax 
Incentives North Dakota offers business a 
favourable tax climate that 
promotes growth and opportunity 
through traditional tax incentives and innovative new opportunities. Businesses and individuals may qualify 
for one or more tax incentives for 
purchasing, leasing, or making 
improvements to real property located in a North Dakota Renaissance Zone.  
A Renaissance Zone is a designated 
area within a city that is approved by the Department of Commerce Division 
of Community Services.  The tax 
incentives consist of a variety of state income and financial institution tax 
exemptions and credits, and local 
property tax exemptions.   Income tax credit of $10,000 per year for 5 years 
for purchasing or rehabilitating a single-family 
residence that is the individual's primary place of 
residence.  If the credit exceeds the tax liability for 
a year, the excess credit is forfeited.  A partial or 
complete income exemption for five years is 
available to a taxpayer for income tax or financial institution tax purposes for (1) purchasing 
residential or commercial real property in a zone 
for a business or investment purpose, (2) leasing residential or commercial real property in a zone 
for business use, or (3) re habilitating residential or 
commercial real property in a zone for a business or investment purpose.  An individual may elect to 
take an income tax credit of $2,000 per year for 
five years in lieu of th e income exemption if (1) 
the project consists of a purchase or expansion of a 
business owned by the individual, (2) the cost of 
the project is more than $75,000, and (3) the project is located in a city with a population equal 
to or less than 2,500.  If the credit exceeds the tax 
liability for a year, the exce ss credit is forfeited.  A 
tax credit equal to twenty-f ive per cent of the cost 
of preserving or renovating historic real property is 
allowed for income tax or financial institution tax 
purposes.  A maximum credit of $250,000 is allowed per project.  If the credit exceeds the tax 
liability for the year in which the credit is first 
allowed, the excess credit may be carried forward for up to five years.   Ongoing 
Ohio Community 
Reinvestment 
Areas Department of 
Development Tax 
Abatement 
or 
Reduction Local tax incentives for businesses 
that expand or locate in designated 
areas of Ohio.  Programme 
highlights include substantial real estate property tax reduction.   Designated areas. Up to 100 per cent exemption of the improved real 
estate property tax valuation for up to 15 years.  In 
some instances, local school board approval may 
be required.   Ongoing 
Ohio Enterprise Zones Department of 
Development Mixed Tax Local and state tax incentives for 
businesses that expand or locate in designated areas of Ohio. Businesses must finalize an Enterprise 
Zone Agreement prior to project initiation, agree to retain or create 
employment and establish, expand, 
renovate, or occupy a facility in an Enterprise Zone.   Up to 75 per cent exempti on in incorporated areas 
and up to 60 per cent in unincorporated areas of the improved real estate or  new tangible personal 
property tax valuation for up to 10 years.  In some 
instances, local school board approval may be required.   Ongoing  
  G/SCM/N/123/USA 
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Ohio Governor's Office 
of Appalachia 
Grants Department of 
Development Grant The Governor's Office of 
Appalachia (GOA), involved with 
both short- and long-term planning, 
facilitates development and serves as an advocate for the region by 
developing policy and promoting 
specific projects and proposals that originate from the region's 
residents. GOA receives approximately 
$4 million annually from the 
Appalachian Regional Commission 
(ARC) to administer the state ARC programme and fund special project 
development. GOA receives approximately $4 million annually 
from the Appalachian Regional Commission 
(ARC) to administer the state ARC programme and 
fund special project development. Ongoing 
Ohio Local Economic 
Development 
Program of CDD Department of 
Development Grant The grant programme provides 
incentives for projects to take place 
in distressed areas where private sector developers are reluctant to 
invest, including grants of up to 
$50,000 with as much as $25,000 of grant being used for project 
development costs. Low and moderate income 
communities. At least 50 per cent of the grant must be used for 
project implementation costs.  Requires at least 2:1 
ratio of other funds.  As much as $25,000 of grant may be used for project development (professional 
services planning and administration). Ongoing 
Ohio Pioneer Rural 
Loan Program Department of 
Development Loan Provides direct loans for businesses 
locating or expanding in Ohio's 
rural areas.  Businesses must 
demonstrate that they will create new jobs for Ohio citizens in rural 
areas.  Loan may be used for 
acquisition of land and buildings, new construction, renovation and 
expansion of existing buildings and 
acquisition of machinery and equipment.  Eligible areas include counties with 
labour surplus, distressed counties and 
situationally distressed counties.  The 
programme seeks to finance projects that will create/retain at least one job 
for every $35,000 of state investment 
during the first three years of the project.   The maximum loan amount is $750,000.  
Participation by the Pioneer Rural Loan 
Programme for any one project cannot exceed 
75 per cent of the total fixed-asset costs.  The annual interest rate for the Pioneer Rural Loan 
financing will be fixed at not greater than half the 
prime rate, which shall be determined solely by the State Development Director.  The term of the 
Pioneer Rural Loan will be  based on the useful life 
of the assets being financed and the term of the bank loan in the project.  The term on a Pioneer 
Rural Loan cannot exceed 15 years for real estate 
financing or seven years for machinery financing. Ongoing 
Ohio Rural Industrial 
Park Loan Department of 
Development Loan Provides direct loans and loan 
guarantees to rural, distressed local communities and other eligible 
applicants committed to creating 
well-planned industrial parks. Non-profit organizations that promote 
economic development in rural areas; Local governmental units are eligible 
to apply for the financing of off-site 
public infrastructure improvements (i.e., water, sewer, roads). Maximum loan available is $1 million and cannot 
exceed 75 per cent of total eligible costs. Ongoing  
   G/SCM/N/123/USA
 Page 141State Programme Title Programme 
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the 
Programme 
Ohio Scrap Tire Loan 
and Grant 
Program Ohio 
Department of 
Natural 
Resources Grant Loans and grants are available to 
scrap tire recyclers who locate or 
expand in Ohio and who 
demonstrate that they will create new/reuse scrap tire products. Companies locating or expanding in 
designated "distressed" areas. ODOD has $2 million available for qualifying 
loans and grants, with a dditional funds earmarked 
to continue the programme through the year 2000.  
Loans and grants are distributed to qualifying companies on a first-come, first-served basis.  
Financing is designated as "take-out" financing 
wherein a business must complete its project utilizing interim financing from a conventional 
lender as its equity.  Upon completion of the 
project, the state funds will be disbursed.  Preferential interest rates and terms are provided 
for qualifying companies locating or expanding in 
"distressed" areas. Ongoing 
Ohio Steel 
Development Initiative: 166 
Direct Loan or 
Loan Guarantee & Ohio Enterprise Bond Fund Dept. of 
Development Loan Support the steel industry. Steel makers, processors, and foundries 
(SIC 3300 & 3400) making new capital investments; eligible investments 
include fixed asset investment in 
building, machinery, and equipment.  To date, ten companies have benefited from this programme. Up to $30 million available (up to $10 million per 
company) under two programmes:  1) Direct Loan or Loan Guarantee-provides up to 30-40 per cent 
of eligible project costs, $15,000 of state money 
loaned per job retained or created in non-distressed areas;  $35,000 of state money loaned per job retained or created in distressed areas;  10 per cent 
equity requirement;  interest rate fixed at 3 per 
cent;  term of 5-15 years based on life of fixed assets;  2) Ohio Enterprise Bond Fund- provides up 
to 90 per cent of fixed rate  financing of eligible 
project costs;  $75,000 of bond money loaned per job retained or created;  15-20 year term based on 
life of fixed assets.  Up to $60 million in tax-
exempt financing is available for eligible pollution control equipment.   Ongoing 
Ohio Steel 
Development 
Initiative: 
Infrastructure Grants Dept. of 
Development Grant To develop infrastructure.  
Infrastructure grants are allocated 
for public infrastructure 
improvements necessary to move a project forward or make key 
equipment acquisitions.   Steel makers, processors, and foundries 
(SIC 3300 & 3400) making new capital 
investments.  Conditions for receiving 
a grant are job creation and retention.  Up to $5 million over three years. Ongoing 
Ohio Steel 
Development 
Initiative: 
Targeted Industries 
Training Grant 
Program Ohio Board of 
Regents Grant To support the steel industry. Steel makers, processors, and 
foundries. Up to 75 per cent of the instructional and related 
costs of a training programme.  Maximum of 
$50,000 in benefits to a single company during a 
fiscal year-cost per trainee per training project cannot exceed $650.   Ongoing  
  G/SCM/N/123/USA 
Page 142 State Programme Title Programme 
Authority Form of 
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the 
Programme 
Ohio Technology 
Investment Tax 
Credit Department of 
Development Tax Credit Ohio's Technology Investment Tax 
Credit programme offers a variety 
of benefits to Ohio taxpayers who 
invest in small, research and development and technology-
oriented firms.  Through this 
innovative programme, Ohio investors may reduce their state 
taxes by up to 25 per cent of the 
amount they invest in qualified, technology-based Ohio companies.   The Technology Investment Tax Credit 
can benefit investors who meet a 
variety of requirements specified by 
Ohio law.  Investors must invest in Ohio companies which are eligible for 
tax credit investments and are engaged 
in qualified trades or businesses, i.e. technology oriented businesses.   The programme's maximum credit of $90,000 per 
investment may be applied to personal income tax, 
corporation franchise tax,  public utility excise tax 
or the tax on dealers in intangibles.   Ongoing 
Ohio Third Frontier 
Action Fund 
(TFAF) Department of 
Development Grant The Technology Action Fund has 
been renamed the Third Frontier 
Action Fund (TFAF). TFAF 
continues the mission of the Technology Action Fund in 
providing financial support to 
projects that contribute to technology-based economic development in Ohio.  TFAF grant 
awards are made on a competitive 
basis. In this funding cycle proposals are 
sought in three focus areas.  The 
first focus area is to increase the availability of professionally 
managed, early-stage capital to 
Ohio start-up or early-stage technology companies.  The second 
focus area provides support for 
collaborations formed to commercialize a near-term specific 
or platform technology or 
capability.  The third focus area supports the Governor's Fuel Cell 
Initiative.   This initiative will link major existing 
businesses, educational institutions, 
venture capitalists, entrepreneurs, 
emerging high-tech enterprises, and the broader community in capitalizing on 
the region's strengths to foster, 
connect, leverage, and promote the varied new economy clusters that have emerged there.  The initial purpose of the fu nd, established with a 
budget of $3 million, was to increase the amount of 
federal research dollars leveraged into the state.  In 
2000 and 2001, the Fund was increased to $15 million each year and the focus of support 
changed to support entr epreneurial activity in 
technology sectors in Ohio. Ongoing 
Ohio Urban 
Redevelopment 
Loan DOD, Office of 
Business 
Development Loan Removes development barriers 
from urban core property so that 
private sector job opportunities can 
be created. Land and building acquisition, 
infrastructure improvements, 
brownfield site remediation activities, 
and building renova tion/demolition.   Maximum loan available is $5 million or 40 per 
cent of eligible costs, wh ichever is less.  Maximum 
loan term up to 15 years.   Ongoing 
Ohio Innovation Ohio 
Loan Fund  Department of 
Development Loans  Provide capital to Ohio businesses 
having difficulty securing conventional sources due to the 
technical and commercial risk 
factors associated with the development of new products or 
services. Established Ohio businesses with a 
proven operating history undertaking an investment project in one of the 
following targeted industry sectors:  
advanced materials;  instruments, controls and electronics;  power and 
propulsion; bioscience;  and 
information technology.  Financing for up to 75 per cent of the total eligible 
project costs with loans of  up to $5 million.  The 
loan term is expected to  be no more than 4 to 
7 years. The interest rate is fixed at or below 
private sector loans for comparable levels of risk and is generally in the range of the prime rate plus 
2 per cent.  The Innovation Ohio Loan Fund also 
includes a participation fee of 10 per cent of the original principal payable upon maturity of the 
loan.  Ongoing  
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Ohio Research and 
Development 
Investment Loan 
Fund  Department of 
Development Loans and 
correspondi
ng Tax 
Credit  Aggressively pursue investments in 
research and development 
operations and facilities by 
providing direct financial assistance. Creditworthy existing businesses with 
significant assets and sales undertaking 
Ohio investment projects that facilitate 
research for the purpose of discovering information that is technological in 
nature and the application of which is 
intended to be useful in the development of new products and/or 
processes.  Financing for up to 50 per cent of the total eligible 
project costs with loans ranging from $1.5 to 
$25 million.  Depending on the useful life of the 
asset, the term may extend to 15 years.  The interest rate is fixed at or below market rates and 
will typically not exceed 50 per cent of the current 
prime rate.  A non-refundable corporate franchise tax credit in the amount of principal and interest 
repaid on the loan during the year, up to 
$150,000 will be available to Businesses receiving a Research and Development Investment Loan. Ongoing 
Oklahoma Enterprise Zones Department of 
Commerce Mixed 
Financing The state has designated Enterprise 
Zones which can be either 
depressed counties or inner cities.  
These zones provide three major inducements for business.  Double 
the Investment/New jobs tax credit 
is allowed and low interest loans may be made available through the enterprise district loan fund.  The 
enterprise district management 
authorities created in each enterprise district are empowered to 
establish venture capital loan 
programmes and to solicit proposals from enterprises seeking to 
establish or expand facilities in the 
zones.  By statute, funds for these programmes would come from the 
issuance of general obligation 
bonds by the district involved.   Any type of manufacturing company 
locating in low income, high out-
migration, or high unemployment 
areas. These loans can be for up to 100 per cent of the 
estimated cost of the building and equipment. Ongoing  
  G/SCM/N/123/USA 
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Authority Form of 
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the 
Programme 
Oklahoma Investment New 
Jobs Income Tax 
Credit Oklahoma Tax 
Commission Tax Credit The Investment New Jobs Income 
Tax Credit allows manufacturers or 
qualified aircraft maintenance 
facilities the greater credit of one per cent per year of the investment 
in qualified depreciable property 
the year the property is placed in service, or a credit of $500 per year 
per additional new jobs engaged 
only in manufacturing or processing.  To qualify, the 
depreciable property must have a 
floor cost of at least $50,000.  New jobs credit shall be for each full 
time equivalent manufacturing 
employee earning at least $7,000 during each year the credit is 
claimed.  The taxpayer that invests 
in qualifying property and also adds new employees should figure the 
tax credit both ways (total capital 
expenditures if over $50,000 or net increase in full time equivalent employees) and take the larger 
credit.  In Enterprise Zones the 
credit is doubled.  Firms that take advantage of the Investment/Jobs 
Income Tax Credit Package are 
ineligible for the Quality Jobs 10-Year Cash Back Incentive. Manufacturing, aircraft maintenance 
facilities and various computer service 
industries. The credit allowable in any year is limited to the 
employer's tax liability;  any credit not used may 
be carried forward and claimed in any of the five 
years following the initial five-year period.  It may be necessary to retain up to ten years of records to 
properly document the credit. Ongoing 
Oklahoma Quality Jobs 10-
Year Cash Back 
Incentive Department of 
Commerce Tax Refund The programme is targeted to 
manufacturers and certain service 
companies which utilize the new 
Oklahoma Quality Jobs programme by having a new payroll investment 
of $2.5 million or more.  It is an 
easy-access programme which provides direct payment incentives (based on new wages paid) to 
companies for up to ten years.  The 
programme provides quarterly cash payments of up to 5 per cent of new 
taxable payroll directly to 
qualifying companies for up to ten years.  Beginning in 2003, jobs 
included in the $2.5 million 
threshold must be paid at least equal to the average county wage 
where the company is located, not 
to exceed $25,965, indexed Fast growing businesses within the SIC 
Codes 20-39. Payments are generally limited to 5 per cent of 
payroll and for most businesses will be in the 4 per 
cent to 5 per cent range. Ongoing  
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Programme 
annually. Firms cannot utilize the jobs or 
investment tax credit, sales tax 
exemptions for construction, or a variety of additional tax credits and 
exemptions. 
Oklahoma Sales Tax Refunds 
for Computer-related Products Oklahoma Tax 
Commission Tax Refund Oklahoma offers a sales tax refund 
on computers, data processing equipment, related peripherals, 
telegraph or telecommunications 
services or equipment. Qualifying companies include: 
a. New or expanded aircraft maintenance and manufacturing 
facilities that create 250 or more jobs, 
with construction investment of $5 million and purchases of at least $2 
million worth of computers and other 
listed items. b. Research and development or computer services companies (SIC 
7372-7375, 8731-8734). (SIC 7374 
must attain minimum of $100,000 purchases), when at least 50 per cent of 
the annual gross revenue of the 
business is generated by sales of product or service to an out-of-state 
buyer or consumer (includes the 
federal government);  75 per cent of annual gross income results from 
computer services/data processing or 
research and development activities;  and the business employs at least 
10 new workers at an average salary of 
$35,000 for at least three years. Not available. Ongoing 
Oregon Business 
Development Fund Oregon 
Economic Development Department Loan The Oregon Business Development 
Fund is a revolving loan fund administered by the Department.  The programme provides loans to 
businesses for the acquisition of 
property, building, equipment, and working capital. The goal of the programme is to create 
and retain jobs for Oregon companies that are in the "traded sector" or manufacturing companies.  Preferred 
projects are businesses with fewer than 
50 employees located in rural areas and enterprise zones and/or businesses 
located in "distressed" areas. Maximum of 40 per cent OBDF participation.  
Maximum loan size is $500,000.  The term of the loan cannot exceed the usef ul life of the collateral 
or 20 years, whichever is less.  The interest rate is 
one point above the current yield of US Treasury 
securities of a comparable term.  The commission's security interest may be subordinated to a senior 
lender;  however, all loans must be secured by 
good and sufficient collateral except for projects located in economically distressed areas. Ongoing  
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Authority Form of 
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the 
Programme 
Oregon Business 
Retention Services Oregon 
Economic 
Development 
Department Business 
assistance The Oregon Business Retention 
Service is a statewide management 
consulting service that contracts 
with Oregon businesses that have a national or international customer 
base.  The programme assists 
Oregon businesses that either are having financial problems or are 
going through difficult transitions 
with growth, market shifts, or an ownership change.  In addition, 
OBRS has provided partial funding 
for feasibility studies of potential employee buyouts, and partial 
funding for studies that examine the 
feasibility of reopening closed industrial facilities.  The technical 
assistance to transitional companies 
is provided by private sector consultants who have been screened 
and selected by the Oregon 
Economic Development Department.  The consultant's function is to analyze the company 
including management, operations, 
marketing, and the financial situation of the firm, and make 
specific recommendations and work 
with owners/managers to implement improvements.  The 
OBRS is financed with lottery 
proceeds. The goal of the programme is to retain 
industrial jobs in Oregon's 
communities.  Only companies 
involved in a traded sector industry, primarily manufacturing or processing, 
can qualify for technical assistance or 
employee buy out feasibility studies.  Preference will be given to firms in 
forestry, fishing, and agriculture, 
although strategically placed firms in rural areas will be considered. The consultant's fees are paid by the department, 
but the company is obligated  to repay the cost of 
service within two years.  No interest will be 
charged, and the ability to repay will be taken into consideration.  Particip ating businesses receive up 
to $4,000, or approximately 40 hours, of 
management counsel.  The applicant for a feasibility study of a closed industrial facility must 
provide 25 per cent of the cost of the study in a 
cash match.  The department's contribution, which is in grant form, cannot exceed $30,000. Ongoing 
Oregon Enhanced 
Enterprise Zones Oregon 
Economic & 
Community Development 
Dept. Tax 
Abatement 
or Reduction The Oregon Legislature created this 
incentive in 1997 to spur major 
industrial investments in rural areas of the state with the highest rates of 
unemployment.  The incentive 
provides 7-15 consecutive years of full relief from assessment of all 
local property taxes at the 
investment site.   Rural areas of the state with high 
unemployment. Credit equal to 62.5 per cent of gross payroll is 
applied against state corporate income tax 
liabilities relating to the facility, over and above the first $41 million in annual income taxes.  Ongoing  
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Programme 
Oregon Enterprise Zone 
Program Oregon 
Economic 
Development 
Department Tax 
Abatement 
or 
Reduction The Oregon Enterprise Zone 
Program was created by the 
Legislature in 1985 as a business 
incentive to create new jobs by encouraging business investment in 
economically lagging areas of the 
state.  Oregon has 44 enterprise zones with at least one in virtually 
every region of the state.  Current 
statutory authority allows for up to 48 zones to exist at one time. Forty-four areas in Oregon have been 
designated as enterprise zones.  
Eligible business firms provide goods, 
products or services to other business operations.  This includes not only 
conventional manufacturing and 
industrial activities, but also processing plants, distribution centres, 
maintenance facilities, warehouses, 
corporate headquarters and most call centres. Construction of new facilities in an enterprise zone 
entitles a business to a 100 per cent property tax 
abatement for three years on new plant and most of 
the equipment installed in the plant. Ongoing 
Oregon Industrial 
Development 
Revenue Bonds Oregon 
Economic 
Development 
Department Bond The Economic Development 
Commission issues industrial 
development revenue bonds for 
manufacturing, processing, and tourism related facilities in Oregon. Proceeds of bond issues may be used 
to purchase land, construct new 
buildings, purchase existing buildings, 
purchase new or used equipment, and expand or improve existing plants, as 
well as to cover architectural fees, 
bond counsel, underwriting, and administration of bond issues.  Only manufacturing projects, certain 
facilities such as docks or solid waste 
facilities, and bonds for non-profit organizations are federally tax exempt.  
Specifically excluded are retail 
businesses, shopping centres, office buildings, and recreational facilities, as 
well as projects in which ground 
breaking, construction, or purchase of equipment has started before the 
granting of project eligibility. Industrial development bonds can be used for up to 
100 per cent of the estimated cost of the project.  
The company will enter a lease, loan, or 
conditional sale agreement with the Economic Development Commission.  Bonds may be sold 
publicly or privately.  Interest rates are subject to 
negotiation between the company and bond purchasers. Ongoing 
Oregon Port Revolving 
Loan Fund Oregon 
Economic 
Development Department Loan The Oregon Port Revolving Fund 
provides long-term loans to ports at 
below market costs.  The fund provides loans to port districts for 
improvements to port facilities or to 
assist private firms located on port industrial properties.  Loans may match grants from federal, state, 
and local agencies.   Legally formed Oregon port districts 
are the only entities eligible for Port 
Revolving Fund loans. The term of loans may not exceed 20 years or the 
useful life of the project, whichever is less.  
Interest rates on PRF loans are set at market rates each calendar quarter and not less than 1 per cent 
less than the current yield on US Treasury 
securities of a similar maturity.  All loans must be backed by collateral.  Maximum outstanding balance per port is $3 million. Ongoing  
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Authority Form of 
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the 
Programme 
Oregon Strategic 
Investment 
Program Oregon 
Economic 
Development 
Department Bond For approved projects that benefit 
Oregon's key industries, the 
Department can issue industrial 
development revenue bonds.  Properties developed under the 
programme are exempt during the 
term of the bond from property taxes on assessed value in excess of 
a cap that begins at $100 million 
and is adjusted annually.  A project does not need to be fully bonded to 
be eligible for the tax exemption.  
Participating companies make a payment directly to local 
governments to support community 
costs of meeting additional service requirements.  Local jurisdictions 
have broad discretion to negotiate 
conditions that offset the impact a project may have on a region or 
community. Oregon key industries.   This payment is equal to 25 per cent of exempted 
property taxes but not more than $2 million per 
year.  Ongoing 
Oregon Strategic Reserve 
Fund Oregon 
Economic 
Development 
Department Loan The Department and Governor 
allocate monies from the Strategic 
Reserve Fund to leverage other 
available public, industry, or business resources for projects 
which have positive long-term 
regional or statewide economic impact.  Where possible, funding 
has been targeted toward projects 
related to key industries, distressed timber-dependent communities, 
economies affected by salmon-
related environmental restrictions, or inner city areas. Oregon key industries. Not available. Ongoing 
Pennsylvania Ben Franklin 
Technology Development 
Authority 
(BFTDA) Technology 
Company 
Investment Program  Department of 
Community and Economic 
Development Loan Designed to address the financing 
needs of technology-oriented businesses by providing funds for 
investment and venture capital to 
technology companies. Businesses that fall within identified 
SIC or NAICS codes and are in need of venture capital funds.   Amounts are variable.  Ongoing  
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the 
Programme 
Pennsylvania Community 
Economic 
Development 
Loan Program (CED) Department of 
Community & 
Economic 
Development Loan The programme provides loans to 
small business enterprises located 
in designated distressed areas and is 
designed to assist businesses that will provide products or services to 
previously unserved or underserved 
communities, or that will employ community residents.      An eligible small business enterprise is 
a for-profit corporation, limited 
liability company, partnership, 
proprietorship, or other business entity having one hundred (100) or fewer 
total full-time employees that is 
involved in the business-to-public service, mercantile, commercial, or 
point of sale retail sectors. Limited to $100,000 or 50 per cent of eligible 
costs, whichever is less. Ongoing 
Pennsylvania Enterprise Zone 
Program Department of 
Community and 
Economic Development Grant/Loan Designed to assist financially 
disadvantaged communities in 
preparing and implementing business development strategies 
within municipal Enterprise Zones. Local governments, redevelopment 
authorities, non-profit economic 
development organizations, private sector firms. Planning grants to municipalities up to $50,000;  
basic grants up to $75,000;  grants-to-loans for 
businesses up to $500,000. Ongoing 
Pennsylvania Enterprise Zone 
Tax Credit - 
Community Investment Department of 
Community and 
Economic Development Tax Credit Designed to promote development 
in Enterprise Zones. Businesses located within Enterprise 
Zones.   Tax credits equal 20 per cent of amount invested. 
Up to $250,000 per project. Ongoing 
Pennsylvania Film Production 
Tax Credit Department of 
Community and Economic 
Development Tax Credit Promote the production of feature 
films, television series and television shows in Pennsylvania of 
15 minutes or more in length that 
are intended for a national audience.  
 
 Producers of feature films, television 
series and television shows.  Sixty per 
cent of the total production expenses 
associated with a qualifying production 
must be incurred in Pennsylvania during the taxable year. Tax credit of up to 20 per cent for qualifying film 
or television production expenses. Ongoing 
Pennsylvania Free Use of State-
Owned Property - Film Production Department of 
Community and Economic 
Development Free use of 
property Promote the production of 
commercial motion pictures in Pennsylvania. Commercial film producers. Not available. Ongoing 
Pennsylvania Keystone 
Opportunity Zone 
(KOZ) Department of 
Community and 
Economic Development Tax 
Abatement 
or Reduction Provides state and local tax 
abatement to businesses, property 
owners and residents locating in one of the 12 designated zones as of 
1 January 1999. Businesses, property owners or 
residents located in one of the 
12 designated zones. Abatement of sales, corporate, and other taxes.  
Projects in KOZs are given priority consideration 
for assistance under various community and economic building initiatives. Ongoing  
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Authority Form of 
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the 
Programme 
Pennsylvania Manufacturing 
Sector Incumbent 
Worker Training 
Program Department of 
Labour and 
Industry Grant Workforce training for incumbent 
manufacturers. Regional workforce intermediaries 
(e.g., non-profit organizations or 
associations with 
knowledge/experience in working with targeted industry clusters) or Industry 
Partnerships comprised of employers 
and employee representatives in identified industry clusters:  
biomedical & healthcare; education;  
business & financial services;  advanced materials and diversified 
manufacturing;  building & 
construction;  agriculture & food processing;  information & 
communication services;  logistics & 
transportation;  lumber, wood and paper. Up to $400,000.  Private sector match required.  Ongoing - 
availability 
of funds 
subject to budget 
appropriation
s process.   
Pennsylvania Pennsylvania 
Community Development 
Bank Loan 
Program Department of 
Community and Economic 
Development Loan Provides debt financing for 
Community Development Financial Institutions (CDFIs);  Public funds 
(25 per cent) matched with private 
sector funds (75 per cent) to create a loan pool to promote economic 
development and job creation. State accredited community 
development financial institutions are eligible. 3-, 5-, and 7-year loans of amounts from $250,000 
to $5 million.  Principal and interest repaid quarterly; interest rate is a blend between public 
rate of 50 basis points and private rate of US 
Treasury rate plus 100 basis points;  Collateral required.   Ongoing 
Pennsylvania Pennsylvania 
Industrial 
Development Authority (PIDA) Pennsylvania 
Industrial 
Development Authority 
(PIDA) Loan Provides low-interest loan financing 
to businesses for land and building 
acquisition, construction, and renovation, resulting in the creation 
or retention of jobs.   Manufacturing, industrial (including 
warehouse and distribution centres), 
agri-business, computer or clerical operation centres, office buildings used 
as national or regional headquarters, 
research and development facilities or businesses designated as Keystone 
Innovation Zone companies. Loans up to $2 million.  Loans of up to 
$2.25 million if operations occur within Enterprise 
Zones, Act 47 Industrial Communities, Brownfield Sites, or Keystone Opportunity Zones. Ongoing 
Pennsylvania PTIA 
(Pennsylvania 
Technology Investment Authority) - 
Investment Department of 
Community and 
Economic Development Equity Financing available as direct 
investment to or on behalf of 
technology-oriented businesses located in or maintaining a substantial operating presence in 
Pennsylvania. For-profit businesses that must fall 
within SIC or NAICS codes. Amounts are variable.  Financial return to PTIA 
and PTIA investment is not to exceed 20 per cent 
of total investment. Ongoing 
Pennsylvania Sales Tax 
Exemption - Film 
Production Department of 
Community and 
Economic Development Tax 
Exemption Promote the production of feature 
length films in Pennsylvania 
distributed to a national audience. Feature film producers. Not available. Ongoing 
Pennsylvania Underground 
Storage Tank 
Upgrade Loan 
Program (USTULP) Department of 
Community and 
Economic 
Development Loan Low-interest loan financing to 
business owners of regulated 
underground storage tanks to meet 
federal Environmental Protection Agency upgrade requirements. Business owners of regulated 
underground storage tanks to meet 
Federal EPA upgrade requirements. Amounts of $500,000 or 75 per cent of the total 
eligible cost, whichever is less.  10 years maximum 
term.  The interest rate is fixed for the term of the 
loan and shall equal the in terest rate for a 5-year 
US Treasury note as determined by the Department Ongoing  
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Rhode Island Corporate Income 
Tax Rate 
Reduction Rhode Island 
Economic 
Development 
Corporation Tax 
Abatement 
or 
Reduction The Rhode Island Jobs 
Development Act grants 
incremental income tax reductions 
to companies that create new employment in Rhode Island 
between 1 January 1995 and 
31 July 2004. Statewide The incremental income tax reduces a company's 
corporate income tax rate (currently 9 per cent) by 
a quarter percentage point (0.25) for each 50 new 
jobs created during a three-year period.  For companies with fewer than 100 employees, the tax 
reduction occurs if at least ten jobs are added 
during a three-year period.  The maximum reduction is 6 per cent allowing the present state 
income tax to be reduced to as low as 3 per cent. Ongoing 
Rhode Island Enterprise Zones Rhode Island 
Economic 
Development Corporation Tax Credit A taxpayer who owns a certified 
business facility within an area 
designated by the Enterprise Zone Council may qualify for several 
incentives to expand facilities and 
employment in these areas. Designated Areas:  The State of Rhode 
Island has designated eleven Enterprise 
Zones.  These zones include parts of Bristol, Central Falls, Cranston, 
Cumberland, East Providence, Lincoln, 
Pawtucket, Portsmouth, Providence, Tiverton, Warren, Woonsocket, and 
West Warwick.  Federal enterprise 
zones or enterprise communities qualify for all benef its afforded state 
enterprise zones as of 1 July 1998. Incentives to employ enterprise zone residents:  A 
tax credit is allowed for qualified enterprise zone 
businesses for employing persons domiciled in an enterprise zone.  Firms qualifying for enterprise 
zone tax credits by increasing total company 
employment by 5 per cent within an R.I. enterprise zone may take a credit equal to 75 per cent of the 
total wages paid to enterprise job employees living 
in an enterprise zone.  The maximum credit is 
$15,000 per employee.  Ongoing 
Rhode Island Rhode Island 
Employer's 
Apprenticeship 
Tax Credit Rhode Island 
Economic 
Development 
Corporation Tax Credit To promote growth in the metal and 
plastic industries. The credit applies to the following 
trades in the metal and plastic 
industries:  machinist, toolmaker, 
modelmaker, gage maker, patternmaker, plastic process 
technician, tool & machine setter, 
diesinker, moldmaker, tool & die maker, machine tool repair. The annual credit allowed is 50 per cent of the 
actual wages paid to the qualifying apprentice or 
$4,800, whichever is less. Ongoing 
South Carolina Corporate Income 
Tax Moratorium 
in Distressed 
Counties South Carolina 
Department of 
Revenue Corporate 
Income Tax 
Moratorium To encourage growth in 
economically distressed counties. Companies located in South Carolina's 
most economically distressed counties. Corporate income tax moratorium.  Length of 
moratorium dependent upon number of new jobs 
created:  100 new jobs over 5 years results in a 
10 year moratorium; 200 new jobs results in a 15 year moratorium. Ongoing 
South Carolina Economic Impact 
Zone Investment 
Tax Credit South Carolina 
Department of 
Commerce Tax Credit To help offset the impact of federal 
downsizing in the state and spur 
growth in areas surrounding 
Charleston Naval Base, Myrtle Beach Air Force Base, and the Savannah River Site. Manufactures located in Economic 
Impact Zones. One-time credit against a company's corporate tax 
of between 1 per cent and 5 per cent of a 
company's investment in new production 
equipment.  Credit percentage depends on the applicable recovery pe riod for property under the 
Internal Revenue Code. Ongoing  
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the 
Programme 
South Carolina Fee-in-lieu of 
Local Property 
Taxes Local 
Governments Tax 
Abatement 
or 
Reduction A company can negotiate a Fee-in-
Lieu of property taxes agreement 
with a county if certain investment 
criteria are met.  The advantages to a company include:  (1) savings, as 
payments to local government are 
reduced significantly through negotiation of a lower assessment 
ratio and negotiation of an 
applicable mileage rate;  (2) planning, as payments to local 
government are stabilized for the 
term of the agreement (up to twenty years);  and (3) scheduling, as the 
payment stream can be negotiated 
to meet the financing needs of the company.  A company can qualify 
to negotiate a FILOT with an 
investment as low as $5 million.   Qualifying investments of $5 million 
or more.   Savings will occur by reducing the assessment 
ratio from 10.5 per cent to a minimum of 6.0 per 
cent and potentially locking in the mileage rate for 
the life of the agreement up to 20 years.  All terms 
are negotiated with counties.   Ongoing 
South Carolina Jobs Tax Credit 
for New Job Creation SC Department 
of Revenue Tax Credit Provides a credit to corporate 
income tax or premium tax based upon new jobs created by a 
company locating or expanding a 
facility in any county in the state.  The dollar credit is based on each 
new full-time job created with the 
credit value and minimum required annual job creation varying by 
county. Credits for Least Developed counties 
are $4,500;  Under Developed counties are $3,500;  Moderately Developed 
counties are $2,500;  and Developed 
Counties are $1,500.   The credit is available for a five-year period 
beginning with Year 2 of the Project.  (Year 1 is used to establish the created job levels).  The 
number of new jobs is calculated as the increase in 
the average monthly employment from one year to the next.  The credit can be applied against 
corporate income tax or premium tax, not to 
exceed 50 per cent of the year's tax liability.  Unused credits may be carried forward for 15 years 
from the year earned.   Ongoing 
South Carolina Tax Increment 
Financing for 
Redevelopment Projects Local 
Governments Loan Incorporated municipalities are 
authorized to issue obligations for 
the purpose of redevelopment within their boundaries.  The debt 
service for such oblig ations is to be 
funded from the added increments of tax revenues resulting from the 
projects.  Obligations must mature 
within 30 years, and interest rates are determined by the governing body of the municipality. Areas eligible for redevelopment 
projects include vacant or improved 
areas that, according to specifications, 
are classified as blighted areas or 
conservation areas.  Areas that are 
deteriorating and declining and threatening to become blighted areas if 
such decline is not checked are 
eligible.  Eligible projects can be buildings, improvements (e.g., street, water, or sewer), parking facility, or 
recreational facilities owned by the 
municipality. Total aggregate area within any one municipality 
may not exceed 5 per cent of the total acreage of 
the municipality.  The area designated for redevelopment may not be less than a total of 
1.5 acres. Ongoing 
South Carolina Economic 
Development General 
Obligation Bond South Carolina 
Budget & Control Board Grant To bring new jobs to the State. Companies creating a minimum of 400 
jobs and investing $400 million are eligible for grants to  off-set the cost of 
infrastructure and land. Varies depending on infrastructure need, project 
size and project importance. Ongoing  
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Programme 
South Carolina Jobs Development 
Credit SC Coordinating 
Council for 
Economic 
Development Tax Credit To create high-paying quality jobs 
with an emphasis on rural areas. Companies creating new jobs and 
bringing in new capital investment. Support is in the form of a refundable credit 
against employee withhol ding taxes.  Amount 
varies depending on wage rates and the county in 
which the project locates.  It can be up to 5 per cent of wages, if compensation levels are high enough.    Ongoing 
South Dakota Agricultural 
Processing 
Facilities Tax 
Refund Chapters 10-
46A, 10-45, 10-
46 Tax Refund Refund for contractor's excise taxes 
imposed and paid under the 
provisions of chapter 10-46A for 
the construction of a new agricultural processing facility, and 
for sales or use taxes imposed and 
paid under the provisions of chapters 10-45 and 10-46 for the 
purchase or use of agricultural 
processing equipment.   Agriculture processing facilities 
building construction or equipment 
purchase projects with total minimum 
cost of $4.5 million.  Applicable only to project costs incurred and paid after 
1 April 1997.  Refund permits are valid 
for thirty-six (36) months, during which time all project costs are 
cumulative. 100 per cent of the taxes attri butable to the project. Ongoing 
Tennessee Economic 
Development Loan Fund Tennessee 
Valley Authority Loan TVA Economic Development 
Investment Funds are designed to provide capital to finance companies in the Tennessee Valley, 
generate high-value jobs, and make 
new capital investment.  The TVA Economic Development Loan Fund 
is a $100 million revolving loan 
programme that provides low interest loans to established 
companies relocating or expanding 
their operations in the Tennessee Valley. Businesses must be located in the TVA 
power service area.  Manufacturing and distribution businesses are the primary targets.  Specifically targeted 
are automotives, plastics, metals and 
metal fabrication, and electronics.  To be eligible, the loan must be used for 
buildings, plant equipment, 
infrastructure, or property, based on the capital investment leveraged, the 
number of jobs created, power 
generated and geographic diversity. The maximum loan investment is $2 million for a 
single project.  Loans are generally awarded for five to ten years - from five to seven years for equipment and eight to ten years for real property.  
Terms and rates are determined on a project by 
project basis.   Ongoing 
Tennessee Jobs Tax Credit Tennessee 
Department of 
Revenue  Tax Credit To create jobs and increase 
investment. Eligible business enterprises Credit is $2,000 or $4,500 per new full time job for 
economically distressed counties.  The credit is 
applied against the total of both franchise and 
excise tax liability.  The offset amount ranges from 33-1/3 to 100 per cent based on unemployment 
levels.  Credit may be carried forward for up to 15 
years or until used. Ongoing 
Tennessee Minority Business 
Development 
Loan Fund Tennessee 
Valley Authority Loan TVA's Minority Business 
Development Loan fund is a 
revolving loan fund established to support the start, growth, and 
expansion of minority and other 
socially and economically disadvantaged business owners in 
the Valley. Business must be located in the TVA 
power service area.  "Social and 
economical disadvantage" have the meanings described in the Small 
Business Act (15 U.S.C. 
Section 637 (a)). Loans range from $50,000 up to $500,000.  Loans 
are generally awarded for a period of three to ten years - from five to seven years for equipment and eight to ten years for real property.  Terms and 
rates are determined on a project by project basis.  
Loans are typically below market rate with specific rates determined on a case by case basis. Ongoing  
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Tennessee Sales and Use Tax 
Exemptions Tennessee 
Department of 
Revenue Tax 
Exemption The sales tax applies to any person 
or company who manufactures, 
distributes or retails tangible 
personal property within the state.  The sales tax places the legal 
incidence of tax upon the seller.  
The Tennessee state sales tax is 7 per cent and the local option sales 
tax ranges from 1 per cent to 
2.75 per cent. Statewide.   Tennessee offers the following sales tax incentives 
and exemptions:  No sales tax on purchases, 
installation and repairs of qualified industrial 
machinery;  purchases of material handling and racking equipment associated with the required 
capital investment of $10 million by a distribution 
or warehouse facility;  raw materials for processing;  pollution control for manufacturers.  
Other pollution control equipment may be eligible 
for sales tax credit.  Reduced sales tax rates for manufacturers' use of energy fuel and water; tax 
exempt if used directly in the manufacturing 
process.  Credit of 4.5 per cent for state sales and use taxes paid on building materials, machinery, 
and equipment for new or expanded corporate 
headquarters (regional, national, or international) meeting capital investment requirement of 
$50 million.  Refund on taxes paid on goods and 
services by motion picture production companies filming or producing in Tennessee that meet 
expenditures requirement of $500,000.  Ongoing 
Tennessee Special 
Opportunities Counties (SOC) 
Program Tennessee 
Valley Authority Loan The TVA Special Opportunities 
Counties (SOC) fund is a $15 million revolving loan 
programme that provides low 
interest loans targ eted to companies 
expanding or relocating in the 
Tennessee Valley's most 
economically distressed communities. Only the 50 counties in the Valley with 
the lowest per capita income ranked by the per cent of residents below the 
poverty level are eligible for the 
programme.  This list is updated on an annual basis.  TVA maintains a current 
listing of eligible Tennessee counties. The maximum loan investment is $300,000.  
Funding is provided to the local government/development organization to be loaned 
by them at the TVA long-term borrowing rate 
(established at the time the loan is closed).  
Equipment loans are generally five to seven years 
and loans for real property are made for up to 
I0 years.   All funding is  subject to availability of 
funds. Ongoing 
Texas Product 
Development 
Fund & Small 
Business  Incubator Fund Office of the 
Governor Loan To promote the development of 
small businesses or eligible 
products with a statutory preference 
to be given in the areas of semiconductor, nanotechnology, 
biotechnology and biomedicine. The programme will support, through 
financing, the development of small 
businesses or eligible products with a 
statutory preference to be given in the areas of semiconductor, 
nanotechnology, biotechnology and 
biomedicine. The Product Development and Small Business 
Incubator Funds have a total of $45 million in 
bonding authority.  Ongoing. 
Texas Defense Economic 
Readjustment 
Zone Program Office of the 
Governor Tax 
Incentives The Defense Economic 
Readjustment Zone Program 
(DERZ) was established as a tool for business recruitment and job 
creation in adversely impacted 
defence dependent communities.  It is designed to provide assistance to 
Texas communities, businesses and 
former defence workers. Designated readjustment projects are 
eligible to apply fo r franchise tax credit 
for job creation and capital investment as well as state sales and use tax refund 
on qualified expenditures.  A 
community must nominate and receive designation as a Defense Economic 
Readjustment Zone and provide 
specific local incentiv es in the zone. Franchise credits are for job creation based upon 
the total amount of salaries and wages as well as 
on capital investment made by the project.  Also the projects are eligible for a sales and use tax 
refund paid on qualifying items and the number of 
jobs created/retained at the site.  The project would be eligible for a refund based upon $2,500 per new 
job created with a maximum of $1,250,000.  The 
number of jobs eligible for a refund cannot to exceed 500 or a number equal to 110 per cent of 
the projected jobs, whichever is less.   Ongoing  
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Texas Economic 
Development Act 
(HB 1200) Local 
Independent 
School Districts Tax 
Limitation 
on 
Appraised Values The Economic Development Act is 
designed to encourage large-scale 
capital investments, especially in 
school districts that have a less than average ad valorem tax base.  
Additionally, the incentive looks to 
aid smaller metropolitan and more rural communities in attracting 
larger capital investments and new, 
high-paying jobs. Manufacturing, R&D, or renewable 
energy businesses subject to franchise 
taxation expanding or relocating in a 
community. The bill works by capping the appraised value of 
capital investments that qualify based on a sliding 
scale tied to the total property wealth of the school 
district where the investment is made.  The scale ranges from a cap of $100 million for school 
districts with tax bases exceeding $10 billion to a 
cap of $1 million for school districts with tax bases under $100 thousand.   Expires 
12/31/07 
Texas Enterprise Zone 
Program Office of the 
Governor Tax Refund The Enterprise Zone Program 
provides communities with an economic development tool in 
partnerships with the state.  The 
programme priority is to new or expanding businesses bringing new 
jobs and capital investment into the 
community.  An area is designated an enterprise zone if the Census Block Group has at least 20 per cent 
of the population in poverty 
according to the most recent decennial US Census.   A business making at least 
$40,000 capital investment into a community may be nominated by the 
local governmental jurisdiction to the 
state for enterprise project status.  In return for hiring a percentage of new 
employees that are economically 
disadvantaged, or enterprise zone residents, the businesses become eligible for a refund of state sales and 
use taxes paid on certain items 
purchased. Enterprise projects are eligible for a refund of state 
sales or use taxes paid on qualifying items such as machinery and equipment, building materials, 
labour for the rehabilitation of existing buildings, 
and electricity and natural gas purchased for use in the enterprise zone.  The amount reimbursed is 
based on the capital investment connected to the 
project and the number of jobs created/retained at the site, the project would be eligible for a refund of state sales and use taxes paid of up to $2,500, 
$5,000 or $7,500 per new job created up to a 
maximum of $1.25 m illion, $2.5 million and 
$3.75 million respectively.  The number of jobs 
eligible for a refund cannot exceed 500.  Ongoing 
Texas Franchise Tax 
Credits for 
Research & Development, Job 
Creation and 
Capital Investment Texas 
Comptroller of 
Public Accounts Tax Credit The R&D credit is available to 
corporations making certain R&D 
expenditures for research activities conducted anywhere in the state.  In 
addition to the R&D credits, the 
legislation also provides for qualifying corporations located in a 
strategic investment area of the 
state to receive franchise tax credits for job creation and capital 
investment based on particular 
criteria.  The programme targets expansion of R&D employment. 
Strategic investment areas are 
designated by the State's Comptroller of Public Accounts based on relative unemployment 
rate and per capita incomes. The R&D credit is available to 
corporations making certain research 
and development expenditures for research activities conducted anywhere 
in the state.  Franchise tax credits are 
also available to corporations located in strategic investment areas of the 
state based on job creation and capital 
investment.  Research and Development Credit; Job Creation 
Credit; Capital Investment Credit  Ongoing  
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Texas Freeport 
Exemption Texas 
Communities Tax 
Incentive A community may choose to offer 
the Freeport Exemption for various 
types of goods that are detained in 
Texas for a short period of time.  Freeport property qualifies for an 
exemption from ad valorem 
taxation only if it has been detained in the state for 175 days or less for 
the purpose of assembly, storage, 
manufacturing, processing or fabricating. New or existing business. 100 per cent of the taxes that would be due are 
exempted. Ongoing 
Texas HB 1200 Texas legislature Tax 
Exemption Tax relief for large capital 
investments.   Industries making large capital 
investments. The bill works by capping the appraised value of 
capital investments that qualify based on a sliding 
scale tied to the total property wealth of the school 
district where the investment is made.  The scale ranges from a cap of $100 million for school 
districts with total property value of $10 billion or 
more to $20 million for school districts with property value less than $100 million.  A separate sliding scale is used for certain rural counties with 
a population of less than 50,000, and those that 
qualify as Strategic Investme nt Areas (SIA's).  The 
investment amount is dete rmined over a two-year 
period. Ongoing 
Texas Product 
Development 
Fund & Small Business  
Incubator Fund Office of the 
Governor Loan The Product Development and 
Small Business Incubator Funds 
have a total of $45 million in bonding authority.  The programme 
will support, through financing, the 
development of small businesses or eligible products with a statutory 
preference to be given in the 
advanced technology areas of semiconductor, nanotechnology, 
biotechnology and biomedicine. Small businesses or eligible products 
with a statutory preference to be given 
in the areas of semiconductor, nanotechnology, biotechnology and 
biomedicine. The Product Development and Small Business 
Incubator Funds have a total of $45 million in 
bonding authority.  Ongoing 
Texas Property Tax 
Abatement Texas 
Comptroller of 
Public Accounts Tax 
Abatement 
or 
Reduction Property taxes are levied by local 
governments and special tax 
districts on all real and tangible 
personal property.  Intangible property, with certain exceptions, is 
not taxed.  Local municipalities and 
counties can designate areas within their jurisdiction. Statewide.   Designation of a reinvest ment zone may be for 
five-year, renewable periods.  Tax abatement 
agreements have a maximum term of 10 years and 
provide for the exemption of real property and tangible personal property located on the real 
property.  Only the increased value of the property 
may be exempted.  Ongoing  
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Texas Property Tax Rule 
9.105 Texas 
Comptroller of 
Public Accounts Tax 
Incentive The Comptroller of Public 
Accounts, through Property Tax 
Rule 9.105, offers a refund of state 
franchise and sales and use taxes paid by companies owning certain 
abated property.  A company which 
meets the following three conditions may apply for a refund:  
1) paid property taxes to a school 
district on property that is located in a reinvestment zone established 
under Chapter 312;  2) is exempt in 
whole or in part from property tax imposed by a city or county under a 
tax abatement agreement 
established under Chapter 312;  and 3) is not in a tax abatement 
agreement with a school district. New or existing business. The refund is equal to the amount of property taxes 
that would have been paid had the company 
entered into a school district abatement agreement 
with terms identical to the city or county abatement 
agreement, not to exceed the net state sales and use 
taxes and franchise taxes paid or collected and 
remitted during that calendar year.  The refund amount may also be limited by a statewide 
appropriation per year for this refund programme. Ongoing 
Texas Rural Municipal 
Loan  Program Texas 
Department of 
Agriculture Loan 
Guaranty The Texas Agricultural Finance 
Authority (TAFA) provides 
financial assistance to governmental 
entities located in the state's rural regions.  Applicants must be 
located in a rural area;  provide 
economic benefits for rural area;  show evidence to repay the 
commitment. City and county governments, 
economic development corporations, 
hospital districts, rail districts, utility 
districts, special districts, agricultural districts and private water and 
wastewater corporations. From $100,000 to an amount approved by Texas 
Agricultural Finance Authority (TAFA) board of 
directors, but targeting projects of less than 
$1,000,000.  TAFA has the authority to purchase an anticipation note from a municipality in an 
amount not to exceed $500,000 for any single 
project for a term of not more than 30 years, without the approval of the Attorney General's 
Office.   Ongoing 
Texas State Sales & Use 
Tax Exemptions - 
Clean Room Texas 
Comptroller of 
Public Accounts Tax 
Incentives Texas businesses are exempt from 
paying state sales and use taxes on 
clean rooms used in the production of semiconductor components or in 
the biotechnology industry are 
exempt as manufacturing equipment.  That includes property 
affixed to or incorporated into 
realty, including integrated systems, fixtures, lighting, moveable 
partitions, piping and all property 
necessary or adapted to reduce contamination or to control airflow, temperature and humidity.  This 
exemption does not include the 
structural shell to which these improvements are attached. New or expanding business.   100 per cent of the taxes that would be due are 
exempted. Ongoing  
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Texas State Sales & Use 
Tax Exemptions - 
Manufacturing 
Machinery and Equipment Texas 
Comptroller of 
Public Accounts Tax 
Incentives Texas businesses are exempt from 
paying state sales and use taxes on 
manufacturing machinery and 
equipment.  Leased or purchased machinery, equipment, replacement 
parts and accessories that have a 
useful life of more than six months, and that are used or consumed in 
the manufacturing, processing, 
fabricating or repa iring of tangible 
personal property for ultimate sale, 
are exempt from state and local 
sales and use tax.  Businesses are exempt from paying state sales and 
use tax on the purchase of 
machinery exclusively used in processing, packing or marketing 
agricultural products by the original 
producer at the location operated by the original producer. New or expanding business. 100 per cent of the taxes that would be due are 
exempted. Ongoing 
Texas Tax Increment 
Financing Office of 
Attorney General Loan The Tax Increment Financing Act 
gives authority to municipalities to designate reinvestment zones for 
the purpose of providing for tax 
increment financing of project costs for public works or public 
improvements in the zone.  This 
also includes other costs such as on-going administrative and operating 
costs. A community that has a geographic 
area known as a reinvestment zone.  Businesses benefiting from the 
incentives must be located within the 
zone.  A municipality may designate an area as a reinvestment zone.   A municipality creating a reinvestment zone may 
issue tax increment bonds or notes, the proceeds of which may be used to pay project costs.  Tax 
increment bonds and notes are payable, as to both 
principal and interest, solely from a tax increment fund established for a reinvestment zone.   Ongoing 
Texas Texas Capital 
Fund Real Estate 
Development Program Texas 
Department of 
Agriculture Grant The Texas Capital Fund Real Estate 
Development Program is designed 
to provide financial resources to non-entitlement communities.  
Funds must be used for real estate 
development to assist a business which commits to create and/or retain permanent jobs, primarily for 
low and moderate income persons.  
Non-entitlement communities are generally rural and/or smaller 
communities.   Non-entitlement city or county 
government entitlement cities/counties 
that do not receive direct funding from 
Housing & Urban Development and 
typically include population of less 
than 50,000 and counties of less than 200,000. Texas Capital Fund has four programme areas:  
1) Main Street Improvements with minimum 
awards of $50,000 and maximum awards $150,000, and matching funds  must be provided.  
2) Real Estate Development with minimum awards 
of $50,000 and maximum awards $750,000 inclusive of administration costs.  The award may not exceed fifty per cent of the total project costs.  
Require minimum equity injection for the total 
project costs by the business.  3) Infrastructure Development with minimum awards of $50,000 
and maximum awards $750,000 inclusive of 
administration costs.  The award may not exceed fifty per cent for the total project costs.  A 
minimum equity injection of ten per cent of the 
total project cost by the business is required. 4) Downtown Revitalization Program with minimum 
awards of $50,000 and maximum awards $150,000 
and matching funds must be provided. Ongoing  
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Programme 
Texas Texas Leverage 
Fund  Office of the 
Governor Loan The Texas Leverage Fund is an 
added source of financing to 
communities that have passed the 
Economic Development Sales Tax.  Funds may be loaned directly to a 
local Industrial Development 
Corporation (IDC) to finance eligible projects.  Sales tax 
revenues pledged by the IDC need 
only be sufficient to cover projected annual debt service as specified in 
the programme guidelines.  This 
allows cities to leverage their economic development sales tax 
and to pursue additional projects. A city that has passed the Economic 
Development Sales Tax A community may borrow 3 - 4 times the amount 
of the city's tax revenues during the term of the 
loan, up to a maximum of $5 million. Ongoing 
Utah Corporate Loan 
Program Department of 
Community and 
Economic 
Development Grant This programme is reserved for 
extraordinary expansions which 
involve heavy capital investment, 
large numbers of new jobs, and high average salary.  Most of these 
applicants are expanding on the 
Wasatch Front. Medium to large businesses. Set by Division of Business and Economic 
Development Board based on Fiscal Impact 
analysis. Ongoing 
Utah Industrial 
Assistance Fund Department of 
Community and Economic 
Development Grant or 
Loans To foster and develop industry to 
assure the welfare of citizens, economic growth and employment. Companies that establish, relocate or 
develop industry in an economically disadvantaged rural area.  Companies 
must fall within a Targeted Market or a 
Corporate Expansion, which must have $10,000,000 in Utah expenditure and 
spend $5.7 to every dollar awarded. The ranges of incentive awards vary from company 
to company depending on the type of incentive being applied for how many jobs are being created, 
financial history , and what a company is 
requesting.  Typically, awards range from $100,000 to$1,000,000. Ongoing 
Utah Utah Enterprise 
Zone Program Department of 
Community and 
Economic Development Tax Credit The Utah Enterprise Zone Program 
was established in 1988. An 
enterprise zone comprises an area identified by local elected and 
economic development officials and 
designated by the state. Any area of the state of Utah which is 
not part of a US Census Bureau 
Metropolitan Statistical Area (MSA) located wholly within the state may be 
eligible for enterprise zone 
designation.  Application for designation must be made by a city 
with 10,000 or less population located 
in a county with 50,000 or less population and not part of an MSA as previously stated, a county with 50,000 
or less population and not part of an 
MSA, or an Indian Tribe for tribal lands.  Applications will be reviewed 
and approved on the basis of economic 
development need, its quality, and other considerations based on a variety 
of economic distress factors, local 
planning, etc. The following tax credits may be claimed by 
eligible businesses locating or expanding in 
enterprise zones on state income tax forms: Ongoing  
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Vermont Industrial 
Development 
Bonds: 
Agricultural Facility and Debt 
Stabilization 
Loans Vermont 
Economic 
Development 
Authority Loans The Vermont Economic 
Development Authority (VEDA) 
promotes economic prosperity and 
increases employment for Vermont businesses by providing low-cost 
capital for eligible facilities. Eligible facilities. Not available. Ongoing. 
Vermont Industrial 
Development Bonds: Rural 
Economic Activity 
Loans Vermont 
Economic Development 
Authority Loans The Vermont Economic 
Development Authority (VEDA) promotes economic prosperity and 
increases employment for Vermont 
businesses by providing low-cost capital for eligible facilities. Eligible facilities. Not available. Ongoing. 
Vermont R&D and 
Sustainable 
Technology Tax 
Credits Vermont 
Economic 
Progress Council Tax Credits The Vermont Economic Progress 
Council (VEPC) administers a 
performance-based tax incentive 
programme for both businesses and municipalities for economic development activity.   Eligible facilities. A credit of up to 10 per cent of qualified research 
and development expenditures (up to 30 per cent 
for companies eligible for the Sustainable 
Technology Credits). Ongoing. 
Vermont Tax Increment 
Financing 
Districts VSA 24, 
Section1891-
1900;  VSA 32 
Section 5401(10)(E) Incremental 
state 
property 
tax may be utilized by 
municipalit
y to subsidize 
infrastructu
re required for 
economic 
development Divert incremental state property 
taxes, generated by new economic 
activity, to help finance 
infrastructure required for that economic activity to occur.   A municipality and the business(es) 
involved may apply to VEPC for 
authorization to ple dge and appropriate 
any incremental valu ation of property 
within a TIF district generated by 
growth in the state education grant list 
located in the TIF district, for a period of ten years.  The taxes generated on 
the incremental property valuation 
must be pledged a nd appropriated for 
interest and repayment on bonded debt 
or prefunded future TIF district debt to 
the extent authorized by VEPC.  Applicant businesses benefit through 
the development of infrastructure 
required to expand.  Municipalities benefit through the use of incremental 
state property taxes to finance the 
infrastructure.  Eligibility criteria are the same for the EATI programme. 
Plus there must be incremental value 
added to the property. Amount of benefit depends on the amount of 
incremental value being added to the property 
within the TIF District.  Ongoing  
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Virginia Clean Fuel 
Vehicle Job 
Creation Tax 
Credit Virginia 
Department of 
Taxation Tax Credit Businesses manufacturing or 
converting vehicles to operate on 
clean fuel and manufacturers of 
components for use in clean fuel vehicles are eligible to receive an 
income tax credit for each new full-
time job created, over and above the previous year's employment level. Clean fuel manufacturing businesses. The credit is equal to $700 in the year the job is 
created, and in each of two succeeding years if the 
job is continued, for a maximum of $2,100 per job.  
Unused credits may be carried forward for five years.  The credit is available for taxable years 
beginning on or after 1 January 1996 through 
31 December 2006.  Businesses receiving this tax credit are not eligible to receive the Major 
Business Facility Job Tax Credit. Ongoing 
Virginia Enterprise Zone 
Program Virginia 
Department of 
Housing and Community 
Development Tax Credit Virginia's Enterprise Zone Program 
is designed to stimulate business 
development in distressed urban and rural areas.  Fifty-six out of a 
possible 60 Zones have been 
designated statewide.  Virginia's Enterprise Zone Program offers 
several special state incentive for 
qualified businesses locating or expanding in a Zone. Sixty Enterprise Zones are authorized 
statewide.  *Programme changed by 
2005 legislation. Acts of Assembly, Chapter 0863  (1) General Tax Credit (2) Refundable Real 
Property Improvements Tax Credit (3) Large 
Project Investment Tax Credit (4) Job Grants.   Ongoing 
Virginia Governor's 
Motion Picture Opportunity Fund Virginia 
Tourism Corporation Varied This fund is to be used, in the sole 
discretion of the Governor, to support the film and video 
industries in Virginia by providing 
the means for attracting production companies and producers who 
make their projects in the 
Commonwealth using Virginia employees, goods and services.   The types of projects eligible for 
consideration will be feature films, children's programmes, documentaries, 
television series or other television 
programmes designed to fit a thirty-minute or longer form at slot.  Projects 
not eligible are industrial, corporate or 
commercial projects, education programmes not intended for 
rebroadcast, adult films, music videos 
and news shows or reports. The fund shall be used by the Governor to assist 
production companies or producers that meet the eligibility requirements set forth in the guidelines.  
The Authority shall assist the Governor in the 
development of guidelines for the use of the Fund.  The guidelines should include provisions for 
geographic diversity and a cap on the amount of 
money available for a certain project. Ongoing 
Virginia Governor's 
Opportunity Fund Virginia 
Economic Development 
Partnership Grant The Governor's Opportunity Fund 
supports industrial development projects that create new jobs and 
investment in accordance with 
criteria established by state legislation.  Grant requests are 
made by the locality and awarded at 
the discretion of the Governor. Funds can be used for site acquisition 
and development; transportation access; training; cons truction or build-
out of publicly-owned buildings; or 
grants or loans to Industrial Development Authorities.  Eligible 
projects must meet the following 
conditions:  (1) projects of a minimum private investment of $10 million and create at least 100 jobs.  In localities 
with a population of 50,000 to 
100,000, a minimum private investment requirement is $5 million 
and the minimum job creation 
requirement is 50 jobs.  In localities with a population under 50,000, a 
minimum private investment 
requirement is $2.5 million and the minimum job creation requirement is 
25 jobs. Local financial participa tion is required on a dollar 
for dollar basis. Ongoing  
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Programme 
Virginia Loan/Grant 
Program Virginia 
Coalfield 
Economic 
Development Authority Mixed The Virginia Coalfield Economic 
Development Authority (VCEDA) 
is designed to enhance the 
economic base of the seven counties and one city of far south-
western Virginia (Buchanan, 
Dickenson, Lee, Russell, Scott, Tazewell, and Wise counties and 
the City of Norton) .  The Authority 
provides low interest loans or grants to qualified new or expanding 
industries through its financing 
programme.  Programme funding is derived from the local coal and gas 
road improvement tax and the 
natural gas severance tax. The loans may be used for real estate 
purchases, construction or expansion 
of buildings, and the purchase of 
machinery and equipment.  To be eligible for the VC EDA loans, private 
businesses must be basic employers 
who will bring new income to the area.  Priority will be given to loans requiring 
$10,000 or less per permanent job 
created, and the average minimum hourly wage should equal or exceed 
1.5 times the current federal minimum 
wage rate at the end of one year of employment.  Any project providing at 
least 25 jobs within 12 months of start-
up will be given priority. Not available. Ongoing 
Virginia Local Enterprise 
Zone Program for 
Technology Zones Virginia 
Economic 
Development Partnership Mixed Virginia cities, counties and towns 
have the ability to establish by 
ordinance, one or more technology zones to attract growth in targeted 
industries.  Qualified businesses 
locating or expanding operations in a zone may receive local permit and 
user fee waivers, local tax 
incentives, special zoning treatment, or exemption from 
ordinances. Technology Industries Once a local technology zone has been established, 
incentives may be provided for up to ten years.  
Each locality designs and administers its own programme. Ongoing 
Virginia Major Business 
Facility Job Tax 
Credit Virginia 
Department of 
Taxation Tax Credit Qualifying companies locating or 
expanding in Virginia receive a 
$1,000 corporate income tax credit for each new full-time job created 
over a threshold number of jobs. Companies locating in Enterprise 
Zones or economically distressed 
areas. Components of the job tax credit include: (1) 
companies locating in Enterprise Zones or 
economically distressed areas are required to meet a 50 job threshold, all other locations have a 100 
job threshold; (2) the $1,000 credit is available for 
each job in excess of the threshold and is taken in equal instalments over three years (i.e. $333 per 
year); (3) credits are available for taxable years 
beginning on and after 1/1/ 95, but before 1/1/05; 
and (4) unused credits may be carried over 10 
years. Ongoing  
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Programme 
Virginia Solar Photovoltaic 
Manufacturing 
Grants Department of 
Mines, Minerals 
and Energy Grant The Solar Photovoltaic 
Manufacturing Grant programme is 
designed to encourage the full 
value-added product development and manufacture of a high 
technology, renewable energy 
source in Virginia.  Any manufacturer who sells solar 
photovoltaic panels, manufactured 
in Virginia, is entitled to receive an annual grant of seventy-five cents 
per watt of the rated capacity of 
panels sold. Manufactures of high-technology and 
renewable energy sources. After 1 January 2002, new companies beginning or 
expanding manufacturing of solar photovoltaic 
panels can receive an annual solar photovoltaic 
manufacturing incentive grant for six years. Ongoing 
Virginia Virginia 
Investment Partnership Grant 
Fund Virginia 
Economic Development 
Partnership Grant The Virginia Investment 
Partnership Grant Fund is a discretionary performance incentive 
programme in which grants are 
negotiated and made to special projects that invest in Virginia and promote stable or growing 
employment opportunities. All companies that have been in 
business in Virginia for at least five years. Companies must have operated in Virginia for at 
least five years and propose projects that fall into one of the following two categories:  Tier one - 
Virginia manufacturers that make a capitalized 
investment of at least $25 million to increase the productivity of a Virginia manufacturing facility or to utilize a more advanced technology while at 
least maintaining stable employment levels.  Tier 
two - Virginia basic employers that make a capitalized investment of at least $100 million and 
create at least 1,000 new jobs. Ongoing 
Washington Coastal Loan 
Program Washington 
State Office of 
Trade and Economic 
Development Loan This fund provides business and 
technical assistance loans to create 
economic opportunities in Jefferson, Clallam, Grays Harbor, 
Pacific, and Wahkiakum counties.  
Business borrowers must demonstrate job creation and 
private investment to qualify for 
loans.  Technical assistance loans for public agencies businesses are 
available for feasibility studies and 
planning projects that benefit the community and create jobs, 
especially for dislocated workers. Jefferson, Clallam, Grays Harbor, 
Pacific, and Wahkiakum counties Variable.  Loans up to $150,000.  Technical 
assistance loans up to $50,000 for public agencies 
and $20,000 for businesses for feasibility studies. Ongoing  
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Authority Form of 
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the 
Programme 
Washington Distressed Area 
Business and 
Occupational Tax 
Credit Washington 
State Office of 
Trade and 
Economic Development Tax Credit Under the Revised Code of 
Washington (RCW) 82.62.030 and 
RCW and 82.62.045 certain areas in 
the state are eligible for a credit against the B&O tax liability at the 
rate of $2,000 or $4,000 per new 
job created by manufacturing, research and development or 
computer software 
firms. This tax break applies to 1) Counties: 
Adams, Asotin, Benton, Chelan, 
Clallam, Columbia, Cowlitz, Ferry, 
Franklin, Grant, Grays Harbor, Kittitas, Klickitat, Lewis, Mason, Okanogan, 
Pacific, Pend Oreille, Skagit, 
Skamania, Steven, Whitman and Yakima;  2) Metropolitan Statistical 
Area: Whatcom;  and 3) Community 
Empowerment Zones:  Bremerton, Tacoma, White Center, Yakima, 
Marysville, Snohomish, Sultan, Acme, 
Deming, Everson, Maple Falls, Sumas, Clearwater, Queets and Quilcene. Credit against the B&O tax liability at the rate of 
$2,000 or $4,000 per new job created.  Ongoing 
Washington Distressed Area 
Sales and Use Tax Deferral/Exemptio
n Program Department of 
Revenue Tax 
Exemption Distressed Area Sales and Use Tax 
Deferral/Exemption Program falls under RCW 82.60.040 and 
82.60.049 and is available for new 
or remodelled building and/or equipment used in manufacturing or 
research and development activities 
in rural countries or economically distressed areas.   This tax break applies to 1) Counties:  
Adams, Asotin, Benton, Chelan, Clallam, Columbia, Cowlitz, Ferry, 
Franklin, Grant, Grays Harbor, Kittitas, 
Klickitat, Lewis, Mason, Okanogan, Pacific, Pend Oreille, Skagit, 
Skamania, Steven, Whitman and 
Yakima;  2) Metropolitan Statistical Area:  Whatcom; and 3) Community 
Empowerment Zones:  Bremerton, 
Tacoma, White Center, Yakima, Marysville, Snohomish, Sultan, Acme, 
Deming, Everson, Maple Falls, Sumas, 
Clearwater, Queets and Quilcene. Not available. Ongoing 
Washington Fishing Boat Fuel Department of 
Revenue Tax 
Exemption  Diesel fuel used by vessels engaged 
in commercial deep sea fishing or in the operation of commercial 
charter fishing boats is exempt from 
retail sales & use tax, if such vessels regularly operate outside of 
state territorial waters and if the 
gross income from such fishing activities is more than $5,000 per 
year.  Vessels engaged in commercial deep 
sea fishing or in the operation of commercial charter fishing boats. Not available. Ongoing 
Washington High Technology 
Business and 
Occupation Tax 
Credit Program Department of 
Revenue Tax Credit The High Technology Business and 
Occupation Tax Credit Program 
allows high technology businesses 
performing research and development in Washington a 
business and occupation tax credit. The eligible high technology 
businesses include:  advanced 
computing, advanced materials, 
biotechnology, electronic device technology and environmental 
technology. An annual credit of up to $2 million is allowed for 
each business that performs the required activities 
and meets the minimum expense requirements.  
The credit cannot exceed  the amount of the 
business and occupation tax due for that calendar 
year.  The rate for the credit is .515 per cent for 
non-profit corporations and associations and 2.5 per cent for profit businesses. Ongoing  
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Washington High Technology 
Sales and Use Tax 
Deferral/Exemptio
n Program Department of 
Revenue Tax 
Exemption The High Technology Sales and 
Use Tax Deferral/Exemption 
Program was enacted in 1994 to 
stimulate growth in certain high technology industries. A sales and use tax deferral/exemption 
is allowed for research and 
development pilot scale manufacturing 
in the areas of advanced computing, advanced materials, biotechnology, 
electronic device technology and 
environmental technology. If the project is used for qualifying purposes for 
eight years, deferred taxes will be forgiven.  If the 
project is used for non-qualifying purposes during 
the eight year period, taxe s plus interest are due on 
a pro-rated basis.  Even if the deferral is 
disallowed, no sales and use tax will be due on 
exempt manufacturing and equipment (i.e. Manufacturing Tax Incentive Program). Ongoing 
Washington Prototype of 
Aircraft Parts Department of 
Revenue Tax 
Exemption 
(retail sales 
& use tax exemption) Purchases of materials used to 
develop prototypes of aircraft parts 
are exempt from sales/use tax, if the 
firm that develops the prototype has taxable sales of less than $20 
million annually.  Further, the 
statute limits the maximum amount of sales tax exemption to 
$100,000 per firm.  Small manufactures of aircraft parts. The statute limits the maximum amount of sales 
tax exemption to $100,000 per firm.  Ongoing 
Washington Rural Washington 
Loan Fund Washington 
State Office of 
Trade and 
Economic Development Loan The Development Loan Fund 
provides gap financing for 
businesses that will create new jobs 
or retain existing jobs, particularly for lower-income persons, in non-
entitlement areas of the state 
experiencing high unemployment.  Priority is given to distressed area 
projects.  Primarily for distressed and timber 
impacted areas. RWLF may lend up to $350,000, in participation 
with private lenders, and in special cases up 
to $700,000. Ongoing 
Washington Ships and Vessels 
Under 
Construction Department of 
Revenue Tax 
Exemption 
(property tax) To improve competitive position of 
the state's shipyards. Provided to vessels under construction 
that are 1,000 tons or more burden 
upon completion. Not available. Ongoing 
Washington Small Timber 
Harvester Department of 
Revenue Tax 
Exemption 
(B&O) To reduce tax burden on small tree 
harvests. Provide to the roughly 2,640 
individuals and small businesses that 
qualify as small timber harvesters. Not available. Ongoing 
Washington $50 Minimum 
Timber Tax Department of 
Revenue Timber 
Excise Tax 
Exemption To support smaller harvesters and 
to reduce administrative costs for 
harvesters and the Department of Revenue. Small timber harvesters Any timber harvester incurring less than $50 in 
timber tax liability per quarter is excused from 
paying the timber excise tax. Ongoing 
West Virginia Business 
Investment and Jobs Expansion 
Tax Credit (Super 
Tax Credit) West Virginia 
Development Office Tax Credit The State of West Virginia offers a 
Super Tax Credit programme that can provide substantial tax credits 
for companies that create jobs.  This 
programme is based upon a formula which is calculated using a 
qualified investment factor and a 
job creation factor. Statewide- Manufacturing, information 
processing, warehousing, goods distribution and destination-oriented 
tourism.  Company must create 50 new 
jobs over 3 years. The amount of qualified investment is based on the 
useful life and cost of real and personal property.  For investment with a usef ul life of 1-4 years, the 
cost percentage is 0 per cent; for 4-6 years of 
useful life, the cost percentage is 33.3 per cent;  for 6-8 years, the cost percentages is 66.7 per cent;  
and for 8 years or more, the cost percentage is 100 
per cent.  The Super Tax Credit is applied at the rate of one-tenth per year for ten years beginning 
with the first taxable year the investment is placed 
into service or use. Ongoing  
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Authority Form of 
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the 
Programme 
West Virginia Consumer Ready 
Tax Credit West Virginia 
Development 
Office Tax Credit A tax credit for wood product 
manufacturers that create jobs after 
30 June 1997.  A consumer-ready 
wood product includes any value-added wood product that does not 
require further manufacturing 
before it may be used and/or purchased. Wood products industry. A $250 credit for each new job created between 
June 1997 and June 2002.  Credit is taken against 
business franchise and corporate net income tax or 
personal tax. Ongoing 
West Virginia Corporate 
Headquarters 
Credit West Virginia 
Development 
Office Tax Credit A credit is available to a company 
that relocates its corporate 
headquarters to West Virginia. Manufacturing, information 
processing, warehousing, goods 
distribution and destination-oriented 
tourism. If at least 15 new jobs are created, the allowable 
credit is 10 per cent of adjusted qualified 
investment.  If the corporate headquarters 
relocation results in 50 or more new jobs, the allowable credit is 50 per cent (or such other 
allowable new jobs percentage) of adjusted 
qualified investment. Ongoing 
West Virginia Economic 
Infrastructure Bond Fund West Virginia 
Development Office Bond The West Virginia Economic 
Infrastructure Bond Fund, a financial assistance programme, provides funding for projects likely 
to foster and enhance economic 
growth and development.  Emphasis will be placed on 
Business and/or Industrial Parks. Statewide with an emphasis on 
business / industrial parks. Repayment of a loan in full or in part may be made 
at any time without penalty.  Credit decisions will be based on the applicant's ability to repay the loan 
and collateral offered to secure the loan. 
Interest Rates for a for-profit sponsor is a 
minimum of the prime rate minus 3 per cent (to be fixed at closing).  Intere st rates for public or not-
for-profit sponsor will not exceed prime minus 
3 per cent.  The length of the loan will be negotiated on each project and will not exceed the 
useful life of the assets being financed or 20 years, 
whichever is less.  The West Virginia Infrastructure and Jobs Development Council may 
defer the repayment of principal and interest up to 
5 years.  The maximum loan amount for a private or public sector project is $3 million.  The 
maximum participation rate for each project is 
70 per cent for private sector projects and 90 per cent for public sector projects. Ongoing 
West Virginia Five for Ten 
Program West Virginia 
Development Office Tax Credit A tax credit for companies that 
make qualified investment of at least $50 million to an existing base 
of $100 million or more. Manufacturing. Establishes the value of asset improvements at 
salvage value for property tax evaluations for 10 years. Ongoing  
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Authority Form of 
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Programme 
West Virginia Industrial Revenue 
Bonds West Virginia 
Economic 
Development 
Authority Bond $47,250,000 of the state's industrial 
bond allocation is reserved for 
small manufacturing projects.  This 
provides for customized financing through federal tax exempt 
industrial revenue bonds.  Available 
January through 15 November of each year, 50 per cent of the unused 
revenues are distributed to qualified 
businesses locating in an enterprise community/enterprise zone and 
50 per cent is available for other 
eligible projects. Statewide. Determined by market.  Capital expenditure limit 
of $10 million. Ongoing 
West Virginia New Steel 
Manufacturing Operations Tax 
Credit (Value-
Added Steel Products) West Virginia 
Department of Tax and 
Revenue Tax Credit To encourage job creation in the 
manufacture of "Value-added steel product"- any product that adds to, 
increases or enhances the value of 
any raw, bare or unimproved steel product. Manufacturer of "value added steel 
products". The maximum amount of the one-time credit is 
$250 for each new job filled by a full time employee at such a facility during the tax year.  
Full-time jobs created by a taxpayer in a short tax 
year during the taxpayer's first year of operation, or filled in the year in whic h this credit expires, are 
prorated. Ongoing 
Wisconsin Community-Based 
Economic 
Development 
Program-Local Economic 
Development 
Project Grants Department of 
Commerce Grant Community-Based Economic 
Development Program-Local 
Economic Development Project 
Grants are intended to enable eligible organizations to conduct 
local economic development 
projects. Eligible uses include the development 
of project-specific plans for industrial 
parks, for downtown business districts 
or for public infrastructure projects that focus on water, sewer and/or 
transportation.  Funds may also be 
used to implement training programmes for local economic 
development professionals;  and to 
develop implementation plans that support local economic development 
projects. Awards are made as grants, with a maximum grant 
amount of $30,000 per recipient.  Recipients must 
provide a 25 per cent match of total project costs, 
except in cases of extreme hardship. Ongoing  
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
the 
Programme 
Wisconsin Corporate 
Exemption for 
Activities of Out-
Of-State Publishers and 
Certain Other 
Foreign Corporations Department of 
Revenue Tax 
Exemption Foreign corporations engaged in 
certain business activities are no 
longer required to file a Wisconsin 
tax return.  An exemption has been granted to out-of-state publishing 
companies that contract with 
Wisconsin printing firms for the printing, storage and distribution of 
books, magazines and other 
publications.  The legislature acted to revise the definitions of what 
constitutes taxable activities in 
order to remove a disincentive for publishers to contract with state 
printers.  The legislature exempted 
several other transactions from state nexus standards such as the 
temporary storage of inventory on 
the premises of Wisconsin firms when the intent is to distribute all of 
the goods outside the state. Statewide.   Not available. Ongoing 
Wisconsin Dairy 2020 Early 
Grant Program Department of 
Commerce Loan To provide support to dairy 
producers in designated areas. Existing and start-up dairy producers 
whose farms are, or will be, located in 
a city, town or village with a 
population of less then 6,000. Up to 75 per cent of eligible project costs up to a 
maximum of $3,000.  Actual amount of funds 
awarded is based on viability of the project, the 
project's economic impact, and fund availability. Ongoing 
Wisconsin Deduction for 
Corporate Dividends 
Received Department of 
Revenue Tax Credit A deduction is allowed for 
dividends received from subsidiaries in which the parent 
company owns at least 70 per cent 
of the voting stock.  In the case of dividends received from unitary 
subsidiaries, the transactions do not 
constitute the realization of income, but merely the transfer of funds 
among branches of a unitary 
business entity. Statewide Not available. Ongoing  
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Authority Form of 
Subsidy Policy Objective To Whom Amounts Duration of 
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Programme 
Wisconsin Small Cities 
Community 
Development 
Block Grant Program-Blight 
Elimination and 
Brownfield Redevelopment 
Program Department of 
Commerce Grant Small Cities Community 
Development Block Grant 
Program-Blight Elimination and 
Brownfield Redevelopment Program provides financial 
assistance to communities in 
assessing or remediating environmental contamination on 
abandoned, idle or underused, and 
blighted commercial or industrial sites to promote development of 
those sites. Most cities, villages and towns with 
populations under 50,000 and all 
counties except Waukesha, Dane and 
Milwaukee Counties. Entitlement municipalities are not eligible. Awards are made as gran ts to eligible local 
governments.  The local government may loan or 
grant the funds to local businesses or non-profit 
organizations to conduct an environmental audit or environmental remediation.  The maximum award 
is $100,000 for environmental audits and $500,000 
for environmental remediation projects.  The local government must contribute at least 25 per cent of 
the total project cost from other sources.  
Municipalities that receive grants must make a commitment to pursue recovery of environmental 
remediation costs from parties causing the 
contamination and to reim burse the Department a 
proportional share of CDBG f unds.  In addition, all 
programme income received in connection with 
loans to businesses or non-profit corporations must be paid to the Department within 30 days. Ongoing 
Wisconsin Small Cities 
Community 
Development Block Grant 
Program-
Economic Development 
Program Department of 
Commerce Grant Small Cities Community 
Development Block Grant 
Program-Economic Development Program provides grants to local 
governments that assist businesses 
in investing private funds to create or retain jobs in the state. Eligible applicants for grants under the 
economic development and public 
facilities components include most cities, villages and towns with 
populations under 50,000 and all 
counties except Dane, Waukesha and Milwaukee counties.  Municipalities 
ineligible for programme funding are 
termed "entitlement communities" (generally, cities w ith populations of at 
least 50,000 and urban counties).  
Entitlement communities are eligible to 
receive CDBG funds directly from the federal government through the block 
grant entitlement programme.  Funds are granted to local governments that 
provide loans to companies to supplement other 
financing for projects that  involve business start-
ups, expansions or retentions.  The maximum grant 
that a community may receive is $1 million per 
year.  The maximum amount of economic development assistance a business may receive 
from one or more local governments is $1 million 
in a five-year period.  To be eligible, 50 per cent of 
the total project cost must be provided privately.  Economic development awards from CDBG funds 
are made on a continuous basis during the year.  Ongoing 
Wisconsin Small Cities 
Community 
Development Block Grant 
Program-Public 
Facilities for Economic 
Development 
Program Department of 
Commerce Grant Small Cities Community 
Development Block Grant 
Program-Public Facilities for Economic Development Program 
provides funding for the expansion 
or improvement of public facility systems which directly benefit 
individual businesses that will 
create or retain jobs and expand the tax base. Most cities, villages and towns with 
populations under 50,000 and all 
counties except Waukesha, Dane and Milwaukee Counties.  Entitlement 
municipalities are not eligible. This programme provides grants to communities.  
The total amount received by a local government 
may not exceed $1,000,000 in a calendar year.  Funding to benefit a single business is limited to 
$750,000.  Funding for this programme includes 
funds provided through a revolving loan fund that consists of monies generated by earlier CDBG 
economic development awards.  The business 
investment must be equal to the CDBG funding provided.  Applications  are accepted year-round, 
subject to the availability of funding. Ongoing  
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Authority Form of 
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the 
Programme 
Wisconsin Tax Incremental 
Financing Department of 
Revenue Loan Tax Incremental Financing (TIF) 
can help a municipality undertake a 
public project to stimulate 
beneficial development or redevelopment that would not 
otherwise occur.  It is a mechanism 
for financing local economic development projects in 
underdeveloped and blighted areas.  
Taxes generated by the increased property values pay for land 
acquisition or needed public works. A city or village can designate a 
specific area within its boundaries as a 
TIF district and formulate a plan to 
develop it.  TIF projects must be approved by the municipality's 
planning commission and legislative 
body.  At least 50 per cent of the TIF district's property area must be 
blighted, in need of  rehabilitation or be 
suitable as an industrial site. TIF is based on two working principles:  (1) new 
private development expands the municipality's tax 
base, thereby increasing property tax revenues;  
and (2) if the municipality must provide public improvements to attract the development, the 
overlying tax districts that benefit from the 
resulting increase in the community's tax base should share in the costs of improvement. Ongoing 
Wisconsin The Wisconsin 
Development 
Fund-Technology Development 
Grants and Loans 
and Technology Development Commercializatio
n Loans Department of 
Commerce Mixed 
Financing The Wisconsin Development Fund-
Technology Development Grants 
and Loans and Technology Development Commercialization 
Loans is a programme designed to 
encourage cooperation between businesses and universities in the research and development of new 
products.  The Fund offers 
matching grants for technology, research and development leading 
to new businesses or consortiums to 
assist infrastructure development and commercialization of new 
products or processes. Awards are made to consortia of 
businesses and institutions of higher 
education.  Consortia may be composed of a company and an 
institution in the University of 
Wisconsin system or another in-state institution offering  post-B.A. or 
professional degrees.   Awards are in the form of grants or loans.  
Recipients must contribute at least 25 per cent of 
project costs as a match.  Loans for successful ventures must be repaid, including a reasonable 
return on the initial investment as determined on a 
case-by-case basis.   Ongoing 
Wisconsin Wisconsin 
Development 
Zone Program Department of 
Commerce Tax Credit The Department of Commerce 
funds Development Zones for the 
purpose of attracting and retaining businesses to the state, and to 
promote economic growth and 
development through job creation and investment in economically 
distressed areas.  Areas are 
designated development zones by the Department of Commerce, and 
are effective for up to 20 years.  
The Department allocates the total statewide authorization of development zone credits, and 
businesses which locate, expand, 
invest and conduct certain economic activities in the zones are 
eligible to claim these credits. Businesses locating in distressed areas. Eligible businesses which conduct economic 
activity in development or enterprise development 
zones may claim the development zone tax credit.  The credit is based on amounts spent on 
environmental remediation and the number of full-
time jobs created or retained.  In 2001, $38.155 million in tax credits were authorized statewide. Ongoing  
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Programme 
Wisconsin Wisconsin 
Technology 
Development 
Zones Department of 
Commerce Tax Credit The technology zone programme 
will address several areas of need to 
ensure Wisconsin's short- and long-
term economic vitality and success, including:  Combating the state's 
'brain drain' by increasing high tech 
jobs; Linking Wisconsin's research expertise with Wisconsin firms to 
grow clusters of high-tech jobs.;  
Linking economic strategies across regions for power through 
collaboration. High-technology businesses.   Eight zones across the state will be designated, and 
will remain in effect for up to 10 years.  Each zone 
will receive a total of $5,0 00,000 in tax credits for 
the duration of their designation. Ongoing 
Wyoming Taxpayer 
Remedies W.S. 39-17-
109(d) Tax Credit Support of ethanol producers. Producers of  ethanol. Credit of 40 cents per gallon. Ongoing 
 
 
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