Selma
& Dallas County, AlabamaEconomic Development Authority
Selma
& Dallas County, Alabama
The Alabama Enterprise Zone Act was passed by the
Alabama Legislature in 1987. The act authorized state tax and
non-tax incentives that are some of the best in the United
States.
Twenty-seven Enterprise Zones across the state of Alabama encourage economic growth in areas considered to have depressed economies. In addition, each area offers innovative packages of local tax and non-tax incentives to encourage businesses to locate or expand in that area's Enterprise Zone.
An employer's maximum tax credit for operations in the zone
shall not exceed $2,500 per new permanent employee hired pursuant
to the act. This tax credit may be applied in all Alabama
Enterprise Zones to any Alabama income tax liability or any
Alabama corporate franchise tax liability.
1 If an employer can certify that at least 30% of new permanent employees hired pursuant to the act were formerly unemployed for at least 90 days prior to this employment, then the employer qualifies for the following Alabama income or franchise tax credit on taxes due from zone operation:
 80% First year, 60%
Second year, 40%
Third year, 20%
Fourth and fifth years. |
2 Employers may receive the following Alabama income or franchise tax credit for new investments in the zone or improvements to existing facilities in the zone provided at least five new permanent employees are hired: 10% on the first $10,000 invested, 5% on the next $90,000 invested, 2% on the remaining investment.
3 Employers may receive a maximum Alabama income or franchise tax credit of $1,000 per new permanent employee for expenses of training those employees in new skills.
1 Employers may receive an exemption from Alabama sales and use tax on the purchases of the materials used in the construction of a building or any addition or improvement thereon for housing any legitimate zone business and on machinery and equipment used in the zone.
2 Employers may receive certain exemptions from Alabama income and corporate franchise tax for a period of five years.
For Section 5 Incentives, a Business:
A Must be located in or locating within the boundaries of an Enterprise Zone.
B Must generally fall into Standard Industrial Classification (SIC) Codes 20 - 42, 44 - 49 or consist of major warehousing, distribution centers, regional or corporate headquarters of companies in the referenced SIC codes or such other activities having a prospect of significant economic impact without threatening the well-being of existing industries located within the county hosting the Enterprise Zone.
C Must expand its labor force, make new capital investment or prevent loss of employment.
D May not have closed or reduced employment elsewhere in Alabama in order to expand into the Enterprise Zone.
E Must obtain an endorsement resolution approved by the appropriate local governing authority prior to participation in the program.
For section 11 incentives for a business:
Must meet the criteria outlined in A--E above and:
F Must certify annually that at least 35% of its employees are residents of the hosting urban Enterprise Zone or are residents of the hosting rural Enterprise Zone county, and were receiving public assistance prior to employment, or were considered employable by traditional standards or lacking in basic skills, or any combination of the above.
G Must
give preference and priority to Alabama manufacturers, suppliers,
contractors and labor, except where not reasonably possible to do
so without added expense, substantial inconvenience, or sacrifice
of operational efficiency.
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Selma & Dallas County
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