You’re looking for a great place to locate your business. A place where you can get the financial and technical resources you need. A place with a skilled workforce and access to trade corridors that keep you connected with the world. A place with an entrepreneurial spirit and leaders who know business. Well, it’s all here in Kansas. Come see what we mean.
SPECIAL GRANTS AND LOANS
The Kiowa County Economic Development Corporation offers special assistance in qualifying for some very unique grant and loan opportunities. In cooperation with the Kansas Dept. of Commerce Network Kansas’ E-Community program, we offer special funds from our revolving loan program. This is often positioned as a “second-mortgage” opportunity when prospective businesses have exhausted conventional lending programs or have special “gap financing” needs.
In addition, and in partnership with Great Plains Development, we also offer assistance with a limited number of other loan and grant opportunities. We can help you explore possibilities with other Kansas Dept. of Commerce programs, USDA, SBA, EDA and other state and government agencies. There are also possibilities for tax credit programs, matching funds and a limited number of regional grants. Contact us for more information.
SITE LOCATION ASSISTANCE
The Business Recruitment team for the Kansas Department of Commerce can assist you with various site location needs. Whether you’re seeking buildings or sites, our team has the resources and information to help you make an informed decision.
CUSTOMIZED INCENTIVE PROPOSALS
Our Business Recruitment Team creates customized incentive proposals for clients based on capital investment, job creation, employee salaries and each company’s unique needs. We also coordinate with community economic development professionals for local incentives such as discounted building and land purchases, reduced property taxes, build-to-suit agreements and finance packages. All types of assistance offered for new company locations are also available for subsequent expansions.
Companies that have developed new sites or facilities in recent years include Goodyear, General Motors, Rubbermaid, Hill’s Pet Nutrition, Boeing IDS, Cessna Aircraft Company, Farmland Foods, Inc., Kimberly-Clark, Kroger, YRC Worldwide, Collective Brands and Koch Industries, Inc.
The Department of Commerce routinely works with Kansas educational institutions to develop business-relevant training. These programs can be customized to meet an employer’s specific needs. Kansas’ universities, community colleges and technical colleges can help businesses analyze jobs; design, develop and evaluate training; screen potential employees; assess incumbent and potential employee skills; and recruit qualified employees.
The Department also continues to offer its traditional workforce training programs. Companies may design training programs to meet specific skill requirements and can apply for financial assistance to offset training costs. Companies creating new jobs may qualify for Investments in Major Projects and Comprehensive Training (IMPACT) or Kansas Industrial Training (KIT) assistance. Jobs created within a Kansas Basic Industry – which includes manufacturing, distribution or regional/national service facilities – may qualify for these programs. Eligibility for either program depends on the number of jobs created and the corresponding wages.
Both programs offer direct financial assistance to pay a negotiated portion of the costs to train a company’s employees. Companies may apply the assistance toward items such as instructors’ salaries; meals, travel and lodging (including out-of-state or international travel); video development; textbooks and training manuals; supplies and materials; temporary training facilities; and curriculum planning and development.
WORKFORCE DEVELOPMENT ASSISTANCE
A variety of services are available through our workforce centers, which are located across the state. Services include statewide and national job listings; applicant pre-screening; space to conduct interviews and job fairs; staff to assist in scheduling; applicant assessment services and testing; and current labor market information. These services are available to all Kansas employers at no cost.
INCOME TAX INCENTIVES
Kansas has two corporate income tax credit programs: the Enterprise Zone Program and the High Performance Incentive Program. These programs can substantially reduce a company’s income tax liability depending on job creation and capital investment.
Enterprise Zone Program – This program offers corporate income tax credits for new job creation and qualified capital investment in Kansas. The entire state of Kansas is designated as an Enterprise Zone.
Eligibility for this program depends on the type of business and the number of jobs created. For example, a firm classified as a manufacturer would need to create at least two net new jobs, while a non-manufacturer would need to create five net new jobs.
The job creation tax credit in the metropolitan areas of Kansas City, Topeka, Wichita and Lawrence is $1,500 per new job created. Designated non-metropolitan areas can provide a credit of $2,500 per new job created. The investment tax credit is 1 percent of qualified investment. Up to 100 percent of corporate income tax liability can be eliminated in a given year, and unused credits may be carried forward indefinitely.
High Performance Incentive Program – This program provides a 10 percent corporate income tax credit on the qualified capital investment of an eligible company. The 10 percent tax credit is awarded to companies that operate an eligible business, pay above-average wages and invest in employee training. The credits can be used to reduce 100 percent of corporate income tax liability in a given year. Credits must be used within a consecutive 10-year period.
Please note that for both the Enterprise Zone Program and the High Performance Incentive Program, qualified capital investment can include items such as the purchase or lease of a facility or equipment, remodeling or build-out costs, fixtures, furniture and computers. Equipment transferred to Kansas from out-of-state is also credited at the original acquisition cost.
A key component of the High Performance Incentive Program is the completion of the Capital Investment Project Description form. This form must be submitted to the Department of Commerce prior to the company signing any document, such as a lease or purchase agreement, that commits the company to locating or expanding in Kansas.
PROPERTY TAX INCENTIVES
Machinery and Equipment Property Tax Exemption – Commercial and industrial machinery and equipment acquired by qualified purchase or lease or transferred into the state is exempt from state and local property tax. The exemption pertains to machinery and equipment used in the expansion of an existing facility or the establishment of a new facility. The exemption covers machinery and equipment used in manufacturing or warehousing/distribution, commercial equipment, computers, desks and chairs, copiers and fax machines.
Business Machinery and Equipment Credit – Kansas offers an annual tax credit against Kansas income tax equal to 25 percent of the personal property tax paid on commercial and industrial machinery and equipment that was in Kansas prior to June 30, 2006. The amount of the credit that exceeds the tax liability will be refunded for companies paying income tax.
Property Tax Abatement – Cities or counties may exempt real property from ad valorem taxation. The tax abatement can include all or any portion of the appraised buildings, land and improvements. A total or partial tax abatement may be in effect for up to 10 years after the calendar year in which the business commences its operations. Any property tax abatement is the decision of the local community or county.
SALES TAX EXEMPTIONS
Sales Tax Exemption – For qualifying companies, both the Enterprise Zone Program and High Performance Incentive Program offer a 100 percent sales tax exemption on the purchase of labor and materials to construct or remodel a facility, as well as on the machinery, equipment, furniture and fixtures used in the facility.
Other Sales Tax Exemptions include:
- Labor related to original construction
- New machinery and equipment for manufacturing and distribution
- Pre- and post-production machinery and equipment, including raw material handling, waste storage, water purification and oil cleaning, as well as ancillary property such as gas pipes, electrical wiring and pollution control equipment
- Tangible personal property that becomes an ingredient or component part of a finished product
- Tangible personal property that is immediately consumed in the production process, including electric power, natural gas and water
- Incoming and outgoing interstate telephone or transmission services (WATTS)
- Real and personal property financed with an Industrial Revenue Bond (IRB)
OTHER TAX INCENTIVE PROGRAMS & BUSINESS INITIATIVES
Right-to-Work State – Union membership is well below the national average.
Inventory Tax Exemption – All merchant and manufacturers’ inventories are exempt from property taxes.
Research Tax Credit – Kansas offers an income tax credit equal to 6.5 percent of a company’s investment in research and development above an expenditure of the previous three-year period. Only 25 percent of the allowable annual credit may be claimed in any one year. Unused credits may be carried forward in 25 percent increments until exhausted.
No Local Income Taxes – Kansas cities and counties do not impose income or earnings taxes on personal or corporate income.
Phase Out of Kansas Franchise Tax – The 2007 Kansas Legislature passed legislation to phase out the franchise tax. The tax will be repealed altogether by tax year 2011.
Reduction of Unemployment Insurance Rates – Kansas has significantly reduced unemployment insurance rates for existing and new employers in Kansas. Existing employers who are current on their account will enjoy a reduction of 40 to 100 percent of their tax rate, depending on their rate category. New Kansas employers will also see a drop in their tax rate, as the new rate for all non-construction industry employers is now 4 percent. Construction industry employers will pay 6 percent.
Reduction in Corporate Income Tax Rate – Kansas will reduce its corporate income tax rate from 7.35 percent to 7 percent by 2011.
Kansas Economic Opportunity Initiatives Fund – The Department of Commerce can provide a zero percent interest forgivable loan to qualified companies. This loan can offset costs associated with the establishment of a new facility or the expansion of an existing facility. Eligible costs include site improvements, construction, build-out and purchases and relocation of machinery and equipment.
The loan is forgiven in 20 percent annual increments over a five-year period based on the job and payroll targets. Approval of funding for this program is based on the number of new jobs created, the level of wages paid to the new employees and the economic impact of the project.
Industrial Revenue Bonds – Industrial Revenue Bonds are a popular method of financing up to 100 percent of a growing business’ land, building and equipment. IRBs are securities issued by cities and counties to provide funds for creditworthy companies to acquire land, construct and equip new facilities or remodel and expand existing facilities. IRBs allow fixed-rate financing for the life of the bond for the project.
Community Development Block Grant (CDBG) – Eligible small city and county governments may apply for Community Development Block Grant economic development funds to make water, sewer or other infrastructure improvements designed to assist companies in creating jobs. These funds may also be used by a business to acquire land or buildings, construct or renovate facilities, purchase machinery and equipment or for working capital. Under this program, companies can apply for up to $35,000 per job created with a maximum limit of $750,000.
CDBG funds can be used for infrastructure improvements that include streets, roads, water lines, sewer lines and rail spurs. Infrastructure funding requires that half the funding be paid back over a 10-year period at a rate of 2 percent. This is accomplished through a special assessment on the real property. Financing for working capital, equipment and real property carries a fixed rate equal to 4 percent or 3 percent below prime, whichever is greater, set on the award date. The term of the loan depends on the type of assets being financed: working capital up to five years, equipment up to 10 years, and real property up to 15 years.
At least 51 percent of the jobs created by the company in connection with this CDBG funding must be held by individuals, who at the time of hire meet the low- to moderate-income guidelines for their county location. The low- to moderate-income status is based on family income and the number of family members.
Partnership Fund – The Department provides low-interest state funds to cities and counties for infrastructure improvements that support Kansas basic enterprises such as manufacturing and distribution. Eligible projects may include construction, rehabilitation or expansion of public facilities, including roads, streets, highways, water supply and treatment facilities, water distribution lines, wastewater collection lines and related improvements.
Kansas Bioscience Authority – Commerce works in partnership with the Kansas Bioscience Authority to assist in the expansion and recruitment of bioscience companies. The KBA has direct financing programs and other resources that can be used to recruit world-class scholars, fund equipment and lab space for research and facilitate the commercialization of bioscience discoveries.
To learn more about the benefits of doing business in Kansas, please contact Barbara Hake at (913) 345-8347 or email@example.com or visit ThinkBigKS.com.