Platte Valley Enterprise Zone

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What is The Platte Valley Enterprise Zone?

The Platte Valley Enterprise Zone is an area of one but no more than sixteen square miles in total area contiguous to the Village of Alda.

The Enterprise Zone Act, LB725, provides tax credits for qualifying businesses which, during any tax year, increase investment by at least $75,000 and increase net employment by an average of two full-time positions.

Credits may be used to reduce a portion of the taxpayer's income tax liability or to obtain a refund of sale and use taxes paid. Initial expansion must occur in one taxable year, but additional credits may be obtained for increasing employment by two or more full-time employees during the next five years. An additional investment of a required amount during this subsequent time is not required.

Mission:

Address and correct existing conditions of economic distress in the Platte Valley Enterprise Zone through a coordinated program that includes the retention and expansion of existing business and industry, the attraction of new business and industry, and improvement of the total quality of life for the residents of the Platte Valley Enterprise Zone.

Goals:

Assist existing businesses and industry with their efforts to maintain and expand their business.
Attract new manufacturing industries to the zone.
Upgrade the employment skills of the zone work force.
Ensure that existing and future residents of the zone are provided with access to a broad range of quality affordable housing units.

Tax Credits:

What Incentives Can Qualified Businesses Receive?

Section 77-27, 188 of the Enterprise Zone Act specifies that a qualified business, under provisions of the Employment Expansion and Investment Incentive Act, may be allowed an enhanced credit against taxes imposed by the Nebraska Revenue Act of 1967 for locating and investing in an Enterprise Zone, while employing zone residents. The amount of the credit, not to exceed seventy-five thousand dollars, shall be:

$4,500 for each new employee and $3,000 per $75,000 of investment, provided at least 50% of the new employees are zone residents;
$4,500 for each new employee who is a zone resident, $1,500 for non-zone residents, and $1,000 per $75,000 of investments; or
the normal provisions for tax credits provided by the Employment Expansion and Investment Incentive Act --- $1,500 per employee and $1,000 per $75,000 of investment.

What Investment Qualifies?

Improvements to real property and tangible personal property which are depreciable under the Internal Revenue Code are included in determining average investment. Land, vehicles, planes, or railroad rolling stock are excluded. Rental or leased property: the value of property rented is calculated as the annualized rent of the property multiplied by eight.

To determine overall investment, use the total of the value of all property used or available for use on the last day of the taxable year. Value of property equals the tax basis before any allowance for depreciation. The net investment requirement is met when the investment on the last day of the taxable year exceeds the investment on the first day of the taxable year and the average investment in Nebraska during each of the three preceding taxable years by at least $75,000.

Credits are not allowed for acquisition of a going concern unless the purchaser adds investment and employees at the qualifying levels.

How Can the Credits be Used?

Credits are used against income tax liability of the taxpayer, but may not, in any taxable year, exceed $75,000. Refunds of sales and use taxes paid on the taxpayer's purchases may be filed quarterly with proof of payment of tax. Upon receipt of contractor certification, a taxpayer will be allowed a refund of sales and use taxes, which the contractor has paid, on tangible personal property incorporated as an improvement to the real estate owned by the taxpayer. With permission of the State Tax Commissioner and contractor certification, the taxpayer may presume that 50 percent of the cost of the improvement was for materials on which the tax was paid and which were incorporated into the project.

Can the Credits be Carried Over?

Credits not used in the first year may be carried over and used against liabilities incurred in the next five taxable years. Failure to maintain required levels of investment and employment for at least two years after creation of the credits will result in recapture of allowed benefits and loss of carryovers.

Are Non-Local Incentives Available?

The Nebraska Legislature encourages the targeting of funds from federal programs, including Community Development Block Grants (CDBG), the Job Training Partnership Act, Community Services Block Grants, federal highway funds, or other federal funds received by the state for designated enterprise zones. In addition, local governments are encouraged to seek designation of enterprise zone areas as community development areas under the Community Development Assistance Act.

Contacts:

Any business interested in applying for benefits under the Enterprise Zone Act is encouraged to contact:

Martha Mayhew
Platte Valley Enterprise Zone
P.O. Box 100
Alda, NE 68810
308/384-6170
308/385-5045 (fax)
Andrew G. Baird, II, President
Grand Island Area Economic Development Corp.
P.O. Box 1486
Grand Island, NE 68802-1486
308/382-9210
308/382-1154 (fax)
Steve Duval
Nebraska Department of Economic Development
P.O. Box 94666
Lincoln, NE 68509-4666
402/471-3742
800/426-6505
Ron Troutman
Nebraska Department of Revenue
P.O. Box 94818
Lincoln, NE 68509-4818
402/471-5880

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