NECALG
Enterprise ZoneEnsuring Growth and Prosperity for Northeast Colorado
Northeast Colorado Enterprise Zone
NECALG’s Enterprise Zone’s goal is to be a regional leader, working cooperatively with the private and public sectors to enhance the economic conditions in the region, and improve the region’s economic prosperity.
Northeast Colorado Enterprise Zone
The Colorado Enterprise Zone (EZ) Program was created by the Colorado Legislature (C.R.S. Title 39, Article 30) to promote a business friendly environment in economically distressed areas by offering state income tax credits that incentivize businesses to locate and develop both for-profit and non-profit organizations to assist with the needs of these communities.
NECALG serves as the administration of the six-county Enterprise Zone (EZ). This Colorado Program offers tax incentives for growth and development of new or existing businesses. In 2016 Capitol Investments were $237,833,167.45 Qualified Investment Tax Credits (ITC) totaled $114,767,400.41 resulting in $3,443.018 in tax credits.
Enterprize Zone Philanthropy
The Enterprise Zone also has philanthropic program that encourages contributions to local projects that enhance business and /or create employment. Taxpayers investing in Enterprise Zones can earn a credit on their Colorado income tax by planning and executing specific economic development activities.
Cash contributions totaled $ 340,870.66; in-kind contributions totaled $69,591.23, resulting in $93,916.57 in tax credits. Individual top contributors were: Qualified Renewable Energy , Morgan County Economic Development, Irrigation Research Foundation, Morgan County and Eben Ezer.
Contribution Tax Credits earned by taxpayers making donations to eligible EZ Contribution Projects need to certify those donations with the project organization or Local Enterprise Zone Administrator. A list of qualified projects is available online at www.choosecolorado.com/ez
How Does this help my business?
The following incentives can be earned by businesses located in Enterprise Zones for tax years beginning 1/1/2014 and after. Please see CO Department of Revenue pages for previous credit amounts.
| BUSINESS INCOME TAX CREDITS | CREDIT AMOUNT | FYI |
| Investment Tax Credit (ITC)
Commercial Vehicle Investment Tax Credit (CVITC) |
3% of equipment purchases
1.5% of commercial vehicle purchases |
FYI Income 11 |
| Job Training Tax Credit | 12% of qualified training expenses | FYI Income 31 |
| New Employee Credit
Agricultural Processor New Employee Credit |
$1,100 per new job
$ 500 per new job |
FYI is not yet
available |
| Employer Sponsored Health Insurance Credit | $1,000 per covered employee | FYI is not yet
available |
| R&D Increase Tax Credit | 3% of increased R&D expenditures | FYI Income 22 |
| Vacant Building Rehabilitation Tax Credit | 25% of rehab expenditures (hard costs) | FYI Income 24 |
FYIs are Department of Revenue publications explaining the tax credits.
| ADDITIONAL EZ INCENTIVES | INCENTIVE AMOUNT | FYI |
| Manufacturing/Mining Sales and Use Tax Exemption | Expanded S&U tax exemption in EZ | FYI Sales 10 & 69 |
| Contribution Tax Credit | 25% cash / 12.5% in-kind on contributions
to EZ projects |
FYI Income 23 |
Additionally, municipalities, counties and special districts may have increased flexibility pertaining to local incentives per CRS 39-30-107.5 if located in an EZ.
Enhanced Rural Enterprise Zones
Some rural counties are designated as being Enhanced Rural Enterprise Zones (EREZ) per CRS 39-30-103.2. Regionally, of the six counties in this EZ, Logan, Phillips, Sedgwick, and Washington are qualified as Enhanced Rural Enterprise Zone areas. Businesses located in a designated EREZ county can earn an increased credit amount with the New Employee Credit (an additional $2,000 per job) and the Agricultural Processor New Employee Credit (an additional $500 per new job). See www.advancecolorado.com/erez for more information and a list of designated counties.
Program Eligibility
Areas with high unemployment rates (25% above state average), low per capita income (25% below state average), and/or slower population growth (less than 25% of state average in rural areas) may be approved for EZ designation by the Economic Development Commission. Only taxpayers engaged in business that is legal under both state and federal law are eligible to claim EZ income tax credits.
Application Process
Each income tax year, a business located in an EZ must apply and be Pre-certified prior to beginning an activity to earn any of the business tax credits listed in the first table. At the end of the income tax year, a business must Certify that the activities were performed. Pre-certification and Certification are applied for online.
