Many Ohio business owners are surprised to learn about the various incentives, credits and other programs available to companies doing business in Ohio. There are a number of opportunities available that can make the cost of doing business, expanding operations or investing in new real estate more affordable. There are criteria that a company must meet in order to qualify, but if you do there are some very valuable opportunities to benefit your company, employees and the bottom line. To help clients, prospects and others determine if they can qualify for these programs, we have provided a summary of the primary programs below.
Ohio Enterprise Zone Program
The Ohio Enterprise Zone Program (OEZP) provides local and state tax incentives for businesses that expand or locate into designated areas of Ohio. The program is administered by municipal and county governments and provides real and personal property tax exemptions to businesses making investments in the state.
Enterprise zones are designated areas of land in which businesses can receive incentives in the form of tax exemptions on eligible new investments. OEZP can provide tax exemptions for a portion of the value of new real and personal property investments when the investment is made in conjunction with a project that includes job creation. Existing land values and existing building values are not eligible (except as noted within rare circumstances).
First a zone must be identified and certified in order to participate in the program. This includes the identification of a location by local communities. Once the zone is defined, local legislative authorities participating in the creation must petition the director of the Development Services Agency. The director then certifies the area so it can become an active Enterprise Zone. Only then can businesses participate in the program.
In order to participate in the program, businesses must finalize an Enterprise Zone Agreement prior to project initiation, agree to retain or create employment, and establish, expand, renovate, or occupy a facility in an Enterprise Zone. Businesses interested in pursuing these incentives should contact the local Enterprise Zone Manager by clicking here.
Ohio Community Reinvestment Area Program
Community Reinvestment Areas (CRAs) are areas of land in which property owners can receive tax incentives for investing in real property improvements. The CRA Program is a direct incentive tax exemption program benefiting property owners who renovate existing buildings or construct new ones. The program permits municipalities or counties to designate areas where investment has been discouraged as a CRA to encourage revitalization of the existing housing stock and the development of new structures.
Created in 1977, the program underwent major revisions in 1994. In fact, there are two types of CRAs in Ohio – those created prior to July 1, 1994 and those created after. The regulations governing each type vary considerably. In each case, however, the local legislative authority with jurisdiction over the designated area determines the size, the number of areas, as well as the term and extent of the real property exemptions.
In order to use the CRA program, a city, village, or county must petition the Ohio Development Services Agency (ODSA) for confirmation of a geographical area in which investment in housing has traditionally been discouraged. Once an area is confirmed by ODSA, communities may offer real property tax exemptions to taxpayers that invest in that area. For more information on the process to establish a CRA, click here.
While these programs are very useful and offer a significant savings, the qualification process can sometimes be complex. For this reason, it’s best to work with an advisor that can guide you through the process to ensure you receive the anticipated benefits. For additional information contact us at 513-241-8383, or click here for email. We look forward to talking with you soon!