Economic Opportunity Credit (NEW) - Replaces the Super Tax Credit for investment put in place after December 31, 2002.  This program allows eligible businesses that create 20 jobs or more to offset up to 80 percent of their state business tax liability apportioned to the new investment over 10 years.  For companies that create jobs that pay higher than statewide average wage the offset can increase to 100% of state business tax liability.  A portion of the credit is deferred for tax years 11 through 13.  Existing credit applies to investment put in place before December 31, 2002.  New economic credit will apply to investments that are put in place after January 2003.

Linked Deposit Program (NEW) - The Linked Deposit Program has been revised to serve the needs of small business companies.  The law provides that the State Treasurer may place up to $20 million in State deposits at West Virginia depository banks to provide low-interest loans to qualified small businesses.  Small businesses are those companies that are headquartered in West Virginia with less than 50 employees.  The loans may be for amounts up to $150,000, for terms up to four years.

Manufacturing Investment Credit (NEW) - Expands on existing investment credit to allow a company a 50% corporate net income tax and franchise tax based on the investment in their facility with no new job creation required.  Current credit allows credit against franchise tax only.  Existing credit applies to investment put in place before December 31, 2002.  New manufacturing investment credit will apply to investments that are put in place after January 2003.

R&D Sales Tax Exemption (NEW) - Materials and equipment purchased for direct use in R&D are exempt from the 6% state sales and use tax.

Strategic R&D Credit (NEW) - Creates one of the most aggressive research credits in the country.  Allows for up to 100% offset of taxes for R&D projects with unlimited carry forwards for 10 years.  Current R&D credit allows for maximum 50% annual credit with no carry forwards.  Existing credit applies to investment put in place before December 31, 2002.  New R&D credit will apply to investments that are put in place after January 2003.

Tax Increment Financing (NEW) - The 2002 Legislature adopted legislation that will place tax increment financing on the ballot for West Virginia voters in November of 2002.  Passage would permit the use of property tax increment financing to allow the increases in property tax associated with qualified economic development and public improvement projects to be used to assist with the long-term financing of these projects and improvements.  If passed by the voters, this bill would go into effect on passage.

Venture Capital (NEW) - Legislation recently enacted in 2002 will provide up to $25 million in State resources to a group of certified venture capital companies.  These funds will allow SBICs to leverage additional federal monies thereby generating up to $100 million in venture capital for West Virginia.

EXISTING INCENTIVES

Corporate Headquarters Credit - Companies that relocate their corporate headquarters are eligible for tax credits.  If 15 new jobs are created, the credit is 10 percent of the adjusted qualified investment.  The credit increases to 50 percent if 50 or more jobs are created.

Direct Loan Programs - The Direct Loan Program provides low-interest loans from the West Virginia Economic Development Authority (WVEDA) to companies expanding or locating in West Virginia.

Economic Infrastructure Bond Fund - Bond fund that can be used for loans to local development authorities for infrastructure improvements to support economic development projects.

Governor’s Guaranteed Work Force Program - This program coordinates State job-training programs and provides customized training and work force development programs for manufacturers and qualifying service companies

Industrial Revenue Bonds - The WVEDA can issue taxable or tax-exempt industrial revenue bonds.  WVEDA also may assist with obtaining allocation from the statewide cap on tax-exempt bonds:  $35 million is annually allocated for small-issue manufacturing bonds; $10 million for qualifying projects in enterprise communities, and $55 million for exempt facility projects.

Investment Tax Credits - Eligible manufacturers may receive a credit against franchise taxes of 10 percent of their investment in expansion or revitalization over 10 years.  Companies may receive a credit of 10 percent of their investments incurred in a qualified research and development project.

Loan Insurance Program - The WVEDA can provide loan insurance to a commercial bank to assist businesses unable to obtain conventional bank financing. This program insures up to 80 percent of a bank loan for a maximum loan term of four years.  The insured portion of any loan may not exceed $150,000.

Manufacturing Sales Tax Exemption - Materials and equipment purchased for direct use in manufacturing are exempt from the 6% state sales and use tax.

Research and Development Project Credits - West Virginia manufacturers may qualify for the Research and Development Project Credit for research activities conducted within the state.  The credit generally equals 10 percent of the qualified investment for conducting a qualified research or development project.  The credit is prorated over a 10-year period and may reduce business franchise tax and corporation net income tax liabilities by up to 50 percent. 

Super Tax Credit - This program allows eligible businesses that create 50 jobs or more to offset up to 80 percent of their state business tax liability apportioned to the new investment over 10 years.  A portion of the credit is deferred for tax years 11 through 13.

Warehouse "Freeport" Tax Exemption - Goods in transit, including finished manufacturing inventories to an out-of-state destination are exempt from ad valorem property taxes when warehoused in West Virginia.