California Enterprise Zone Program Overhaul
On Thursday night, June 27, 2013, the California Assembly passed AB93, an extensive overhaul of California’s enterprise zone program. The bill had been approved by the California Senate on Tuesday night, June 25, and is now awaiting the governor’s signature. Changes to the enterprise zone program have been aggressively pursued by Governor Jerry Brown for the past two years.
AB 93 basically eliminates current California Enterprise Zone incentives as of January 1, 2014. However, businesses located in a CAEZ may continue to generate hiring tax credits for up to 5 years for all qualified employees hired before January 1, 2014 who continue to stay employed by the business. Businesses will also have up to 10 years to utilize all the CAEZ credit that has been or will be generated prior to January 1, 2014.
The legislation provides for several new economic development incentive programs.
Details on these programs are limited at this time:
- a hiring credit program that will retain the current Enterprise Zone boundaries, but will severely limit the types of businesses and employees who may qualify.
- a state Sales & Use Tax credit for businesses in manufacturing and biotech research.
- negotiated tax credits run by the Governor’s Office of Business and economic development (GO-BIZ).
Equifax Workforce Solutions will continue to monitor AB93 and work with our clients located in a CAEZ to maximize and generate as many CAEZ credit carryovers as possible. If your business is interested in more information on the CAEZ program, please contact your Credit Relationship Manger (CRM) or Pete Krieshok at 314-214-7325 or by email at Pete.Krieshok@equifax.com.