Incentive to expand your company in Colorado

A fair regulatory environment and low cost burden are key to Colorado’s favorable business climate. Additional incentives make the region’s business climate even more attractive for companies that meet certain criteria. The state of Colorado and local governments provide incentives that focus on job creation, employee training, expedited permitting and licensing, and infrastructure improvements. Incentives include:

Job Creation

The Strategic Fund is an incentive offered by the Colorado Economic Development Commission (EDC). The Strategic Fund can be considered by the Commission if a business creates net new full-time permanent jobs in Colorado that are maintained for at least one year and materially meet specific requirements.

The Job Growth Incentive Tax Credit was created in 2009. Qualifying businesses can receive an income tax credit of up to 50 percent of the employer FICA obligation on net new job growth. Employers must create 20 or more new jobs with an average wage at least 110 percent of the relevant county average. Employers must retain all new jobs for at least one year to qualify for a minimum credit, and higher credits may be allowed for jobs retained over a longer period.

Job Training

Colorado FIRST and Existing Industry Training Assistance - The Colorado Office of Economic Development and International Trade and the Colorado Community College System offer grants that companies may use to offset training costs. Colorado FIRST grants are for companies moving to the state or existing companies planning to expand. Existing Industry grants offset retraining costs for Colorado companies working to implement new technologies.

Enterprise Zones

The Enterprise Zone program provides incentives for businesses to locate and expand in areas officially designated as economically distressed. Businesses located in these zones may qualify for nine different Enterprise Zone tax credits or exemptions. Local governments may also offer various incentives for investment in Enterprise Zones.

Project Assistance

The Colorado Economic Development Commission approves loans and grants from the state’s economic development fund to public and private entities throughout Colorado to help existing businesses expand and new companies locate to the state. It also implements marketing programs to support ongoing business activities. The Commission is also responsible for policy decisions concerning the Colorado Enterprise Zone program.

The Infrastructure Assistance Fund utilizes federal funds from the U.S. Department of Housing and Urban Development to help businesses construct or improve infrastructure. Grant recipients must demonstrate that a project will create or retain low- and moderate-income jobs, and grant awards are typically limited to a maximum of $500,000.

The Manufacturing Revenue Bonds Program provides favorable, tax-exempt Private Activity Bond financing targeted to small manufacturers in Colorado. The program provides financing for real estate, machinery, and equipment associated with expansion projects specific to manufacturers.

Planning and Feasibility Study Grants are designed to provide funding to determine the feasibility of a project, or to plan for a project, that will be located in Colorado. Such projects must meet an economic development objective and, if implemented, must create new permanent jobs and/or retain existing jobs. The Colorado Office of Economic Development and International Trade can fund a total of $75,000 in feasibility grant awards each year.

Additional Tax Credits

Contaminated Land Redevelopment Income Tax Credit - Colorado corporate and individual taxpayers can receive an income tax credit for expenses associated with the redevelopment of contaminated land. The credit is scheduled to expire on December 31, 2010.

Venture Capital

Certified Capital Companies Program (CAPCO) - The Colorado State Legislature created the CAPCO program in 2001 to provide venture capital funds to new and expanding small businesses throughout the state. CAPCO investments will continue until 2012 or until the $100 million pool of program funds has been exhausted.

Colorado Venture Capital Authority (VCA) - The Colorado General Assembly passed legislation that established a Colorado Venture Capital Authority in 2004. In 2005, the VCA established Colorado Fund 1, a $25 million pool for seed and early-stage capital investments in Colorado businesses. The VCA expects to establish a second $25 million fund in 2010.

For more information on incentives, contact us.