Businesses relocating to or expanding in Utah may be eligible for incentives from the state and/or local municipality. The following is a summary of these programs. The Board of the Governor’s Office of Economic Development meets on the third Friday of each month to review and approve applications for state incentives. Applications submitted by the last Friday of the preceding month will be considered.  For more information on these incentives, please contact Brent at 435.865-0050, or contact us online by clicking here.

Approved in 2005, EDTIF is a State’s most popular incentive. It is a post performance rebate of "new state revenue" generated by a new project, including the payroll tax of the new employees, corporate income tax and sales tax. Incentives granted are based on the potential number of jobs created, wage levels of the new jobs, capital investment in the project, purchases from local suppliers, location of the project and the type of industry. Preference is given to targeted economic clusters of Aviation & Aerospace, Defense & Homeland Security, Life Sciences, Outdoor Products & Recreation, Energy & Natural Resources, Financial Services, and Composite Materials. A local incentive and creation of an Economic Development Zone at the project site are requirements of this incentive program

Qualifying companies must create new jobs paying at least 125% of the county median wage in urban areas, and 100% of the county median wage in rural area. Employees within the client company moving from other parts of the state will not be eligible. The maximum allowable rebate is 30% of new state revenues over 20 years. Typically incentives range from 10% to 20% tax rebates over five to ten years.

Companies expanding or relocating in Utah may apply for incentive grants from the IAF (Industrial Assistance Fund). The IAF is a discretionary fund allocated by the state legislature to help encourage job growth in Utah. Incentives are paid on a post performance basis after jobs are created in yearly increments. Jobs must then be retained over the life of the project.

• The length of the grant is typically five years with an incentive range of $1,000 to $3,000 per new job.

• There are five types of IAF grants available to companies that meet the following qualifications:

RFTP provides cash incentives to existing, small companies in rural Utah for creating high paying jobs and to promote business and economic growth. Companies have an opportunity to be awarded $1,000 for each new job paying 110% of the county average annual wage, $1,250 for each new job paying 115% of the county average annual wage, and $1,500 for each new job paying 125% of the county average annual wage. In addition, the company may receive up to $50,000 for business development purposes. The following criteria apply to all applicants:

The Custom Fit program provides specialized training for companies to train their employees. Custom Fit training is administered through Utah College of Applied Technology centers and state colleges and universities. Training may be conducted at Salt Lake Community College campuses, Applied Technology Centers, or the business location. Instructors may be educators from Utah institutions, private sector consultants, or industry specialists. For companies with salaried in-house instructors, Custom Fit training dollars may be used for materials and facility rentals. This incentive subsidizes up to $250 per trainee for professional training.

Companies doing qualified research in Utah are eligible for income tax credits of up to 6% of qualified research expenses. Qualified research expenses include:

Manufacturers (SIC 2000-3999) are exempt from sales tax on the purchase of new equipment for Utah plant start-up. Replacement manufacturing equipment purchases are also exempt from sales tax.

Industrial revenue bonds are available and issued through local government entities. There is a $10 million cap per issue and a $150 million total annual state allocation cap.

Companies locating or expanding in Utah Enterprise Zones may be eligible for credits on state income tax. The following counties are designated Utah Enterprise Zones:

All businesses, except construction, retail, and public utilities, are eligible for tax credits. Eligible businesses locating or expanding to Enterprise Zones may receive the following corporate income tax credits:

More than twenty Utah communities have been designated by the State of Utah as Recycling Market Development Zones. Businesses that collect, process, distribute, or use recycled materials in their manufacturing process can earn economic incentives by locating in these zones or by applying for the creation of a new zone. Incentives may include:

Effective July 25, 2007, an approved production may receive a rebate up to 15% on Utah expenditures, with a cap of $500,000 per project and a minimum spend amount of $1 million in the state.

Cities and counties may award incentives to companies locating in Economic Development Areas (EDA), Urban Renewal Areas (URA) or Community Development Areas (CDA). The city or county determines EDA/URA/CDA areas on a local level.

Incentive dollars are generated through the creation of new "property tax increment" that a development will generate. When a company constructs a new building, its property tax increment is the result of the assessed value of the building multiplied by the property tax rate. In an EDA or URA, all public entities that are entitled to property tax (school districts, counties, cities, libraries, etc.) agree to rebate their increment back to the new development for a specified period of time as a way to incent the development to occur. In a CDA, public entities can choose to opt-in on a property tax rebate if they see fit.

Incentives are awarded as a percentage of the tax increment created by the development. In the chart below, assume the black area represents the tax increment currently generated by an area. Due to lack of development, or blighted development, the area has a low assessed value and is generating little in the way of tax increment. If new development were to come to the area, the increased assessed value, as the result of new real and personal property, would generate significantly greater amounts of tax increment. A portion of this new tax increment, the area in the grey, would be returned to the development to help cover the costs they incurred to clear an area, build infrastructure or lower the cost of the land.

An approval board is appointed for each EDA/URA/CDA district. Based on the type of district that has been created, the configuration of the board will vary. In an EDA or URA district, a 2/3 majority is required for the creation of the district and the awarding of an incentive. In a CDA, the incentive amount will be based on the number of participating entities.

Small businesses locating or expanding within Salt Lake City or Salt Lake County may be eligible for Revolving Loan Funds.

The Utah Smart Site Program exists to support Internet-based job growth in rural Utah. A rural community must have a local smart site team and a facility for sale or lease that is served by high-speed Internet access. A local smart site team will ideally be comprised of local economic development representatives, elected officials, businessmen from technology-based firms, and businessmen from companies providing high-speed Internet services. Utah smart site communities are well prepared for the IT industry with available, high-speed Internet serviced facilities and willing trained workers. These key elements help minimize the time and costs associated with relocating a business.

Utah has one foreign trade zone, which is presently inactive, located in the International Center, an industrial/business park near the Salt Lake City International Airport. This zone operates outside the U.S. Customs territory, allowing duties on imported goods to be deferred until they leave the zone.

Enacted in 1988, Utah’s Freeport Law exempts inventory or other personal property held for sale from property taxation. (See Utah Code Section 59-2-12-1.)

The Utah Department of Workforce Services (DWS) provides employment and support services to help improve the economic opportunities in the state. The DWS Electronic Job Board is a qualified worker’s database that allows employers to filter applicants for those that have specific abilities, trades, educational attainment and other such criteria. The Electronic Job Board is connected to the American Job Bank, which enables open positions to be posted and viewed nationwide. DWS will also set-up in-house recruitment efforts at the business location and provides office space at various locations for conducting interviews.

Custom Fit/ Corporate Training For Your Organization

If you are an employer who would like to provide more high quality training programs for your staff, you may qualify for Custom Fit Training. In this high demand market, employee retention is critical to business success. Surveys show that employees feel more valued when training is provided on a regular basis, and employers who make training a priority have less employee turnover and hiring costs.

Custom Fit is a dynamic partnership between the Utah Colleges of Applied Technology, the State of Utah and local businesses. Its goal is to provide customized training that allows businesses to be successful.  Whether you need specific technical training, safety certifications, computer skills, leadership or customer service improvements, Custom Fit can work with your company to establish a plan to help. The Utah State Legislature appropriates funds each year as an investment in Utah's economy and workforce development.