Fayetteville NC - Business Incentives

The City of Fayetteville and the many other governmental units having jurisdiction in the area provide a wide variety of incentives in many forms to aid businesses in locating within our community. Click on the links below to see the details of each of these and contact information for obtaining more information.

Links to Incentive Programs:

City of Fayetteville Incentives

Cumberland County Incentives

Utility Incentives

North Carolina Incentives

City of Fayetteville Business and Industry Incentive Packages

The City currently has the following incentive packages available to industries/businesses that wish to expand or relocate to the greater Fayetteville area:

Designated State Development Zone (click here to see map):

Job creation tax credit ($7,000 per full time job if over five jobs created)

Wage subsidy for eligible employees during worker training up to 1 year

7% investment tax credit

Downtown Loan Program for businesses located within the City Vision Plan area - 3000 acres (click here to see map)

This program is sponsored by the City of Fayetteville and local banks and is designed to offer economic incentives to new or existing businesses interested in investing in the downtown area and creating jobs for low to moderate income persons.

The minimum loan amount available is $25,000; the maximum is $150,000

Small Business Loan Program

Designed to foster small business expansion and community revitalization; is intended for small business owners in need of a small loan to help improve their business operation and/or appearance.

The maximum loan available is $25,000; the minimum is $5000

FAÇADE Improvement Grant Program

Purpose is to encourage downtown business property owners to reinvest in and improve the appearance of their building exteriors

The City of Fayetteville will provide a matching grant up to $2,500 for each façade renovated.

Historic District Tax Credits

Downtown Historic District and Haymount Historic District are located within the City Vision Plan area-3,000 acres. Both districts are designated as national historic districts. This designation allows a 20% state tax credit for certified rehabilitation of structures within the district.

Flexible Development Standards

The City has revised some its development standards over the past ten years, such as reducing the required width of streets from 37 foot wide to 27 foot wide and reducing the right-of-way width accordingly.

City and PWC staff will initiate discussions with developers and interested parties to determine if there are other development requirements or other factors that would encourage development within the corporate limits of
Fayetteville.

Brownfields Environmental Testing

Funding, technical assistance and advice are available for environmental testing of properties that are being considered for initial development or redevelopment. Sites must fit the classification of a Brownfields. The potential developer and the City/PWC will work together to develop the workplan in accordance with EPA guidelines that control the funding.
Funding can be used for phase 1 and phase 2 (ASTM standard) environmental assessments. All sites within the City are eligible.

Brownfields Revolving Loan Fund

Funding, up to $1 million, is available as a low interest loan to potential developers of Brownfields properties for the purposes of remediation (cleanup) of contaminates other than petroleum products. Other terms such as time to repay are negotiable depending on the development.

Brownfields Development Tax Incentives

The State of North Carolina, under the authority of the Brownfields Property Reuse Act of 1997, offers decreasing tax reduction incentives for real property taxes for the development of a Brownfields property.
Potential developers must agree to enter into an agreement with NCDENR which also includes a covenant not to sue to the potential developer. The City offers technical assistance and coordination of this program in conjunction with the above mentioned programs.
Currently, the incentives offer the following reductions:

Year	Percent of Appraised Value Excluded
Year 1	90%
Year 2	75%
Year 3	50%
Year 4	30%
Year 5	10%

The City and PWC will continue to look at other incentives to help spur new construction in areas where utility infrastructure now exists both in the downtown core as well as undeveloped acreage where utilities are already in place.

For more information about the City incentive programs, please contact:
City of Fayetteville
Community Development Department
433 Hay Street
City Hall - Room 309
Fayetteville, NC 28301
(910) 433-1601

Click here to download a Microsoft Word document with this information

Click here to go to the City of Fayetteville web site

Click here to return to top of page

Cumberland County Economic Development
Inducement and Investment Policy

Cumberland County has adopted an Economic Development Inducement and Investment Policy that makes available to qualifying companies on a case by case basis performance-based financial support. This policy provides assistance to both new and expanding industry in Fayetteville and Cumberland County.

Companies meeting the qualifications may receive a financial grant measured against the investment return to the County generated from a new investment in building and/or equipment. The County Board of Commissioners will consider each project on a case-by-case basis with grants typically running from three to five years. The project must meet certain threshold requirements. No guarantee of grants may be given until the review process is completed. Meeting these requirements does not automatically qualify a company for a grant.

MINIMUM PROJECT QUALIFICATIONS

Threshold One - For an existing or new project in Cumberland County:
Existing Firms $ 1,000,000 Investment AND 5 Created Jobs
New Firms $ 2,500,000 Investment AND 25 Created Jobs

OR

Threshold Two - For an existing or new project in Cumberland County:
Existing Firms No Minimum Investment BUT 20 Created jobs
New Firms No Minimum Investment BUT 100 Created jobs

BUT IN EITHER CASE

Wage Levels
The wage levels of the jobs created must equal at least 100% of the average
wage paid in the County for that industry sector.

QUALIFYING TYPES OF OPERATIONS
The project must involve a facility to be used for:

corporate or divisional headquarters

research/development

back office operations (e.g. telemarketing, call center, check clearing, etc.)

utilization of high technology or innovative new technologies

HOW GRANTS MAY BE UTILIZED

Grants may be applied for:

internal site infrastructure

external infrastructure

other improvements at the site

job training cost not otherwise reimbursed by grants from the community college system

tax credits pursuant to the state statute

other purposes which leave value in the community as determined on a case-by-case basis by the County Board of Commissioners.

PWC Public Works Commission
Utility Incentives

Availability — Available throughout the territory served by the Public Works Commission in accordance with the Commission's established service regulations and the Commission's established policy for the administration of the Economic Development Rate Schedule.

Applicability — To electric service provided for industrial/commercial facilities expansion or for new electrical loads provided that such expansion or new load exceeds 500kW of maximum monthly demand and provided that the customer has signed an electric service contract with the Commission for an initial term of no less than five (5) years. This rate schedule is applicable to the first thirty-six (36) months of service only. Following the first thirty-six months of service, the customer's account will be reclassified to the appropriate general service rate schedule.

Character of Service — Service shall be three-phase, sixty hertz alternating current at the Commission's standard available voltages. Service shall be provided at a single point of delivery through one meter.

Monthly Rate — The monthly rate for the first thirty-six (36) months of service shall be based on ninety percent (90%) of the otherwise applicable general service rate. Such applicable general service rate shall be based on the size of the customer's total load and the customer's optional election of service under time-of-use billing, where applicable.

Wholesale Power Cost Adjustment — All computed economic development bills are subject to adjustment according to Schedule PCA.

Payments — Bills are due when rendered and are payable within 15 days. If a bill is not so paid, PWC has the right to suspend service in accordance with the service regulations.

For more information about the PWC incentive programs, please contact:
Public Works Commission
955 Old Wilmington Rd.
Fayetteville, NC 28301
(910) 223-4341
(910) 829-0202 fax
donna.peters@faypwc.com

Click here to download a Microsoft Word Document of the PWC Utilities Incentive information

Click here to go to PWC's web site

Return to top of Page

STATE OF NORTH CAROLINA TAX INCENTIVES

William S. Lee Quality Jobs Expansion Act, Opportunity Act, Prosperity Act

CUMBERLAND COUNTY TIER 3

State of North Carolina Tax Credits are available for eligible new and expanding industry in Cumberland County for up to 50% of their tax liability.

ELIGIBLE BUSINESS TYPES

Manufacturing / Processing

Air Courier Services

Central Administrative Office (creating 40 or more new administrative jobs)

Electronic Mail Order (250 jobs Tier 1 & 2 counties only)

Data Processing (with 5 or more employees at least 40 weeks during the year is allowed credit for each additional full-time job)

Eligible companies unsure of their NACIS Code may call the Raleigh Office of the Employment Security Commission at 800.262.0514.

The below listed State of North Carolina Tax Credits are detailed in the following text.

JOB CREATION TAX CREDIT

INVESTMENT TAX CREDIT

RESEARCH AND DEVELOPMENT TAX CREDIT

WORKER TRAINING TAX CREDIT

CENTRAL ADMINISTRATIVE OFFICE CREDIT

CITY OF FAYETTEVILLE DEVELOPMENT ZONE

NORTH CAROLINA JOBS CREATION TAX CREDIT

Tax credits available for new investment and expansions meeting provisions of the
William S. Lee Quality Jobs Expansion Act.

JOB TAX CREDIT……… Cumberland County is a Tier 3 County providing a $ 3,000 Per Job Tax Credit. Fayetteville Development Zone provides an additional $ 4,000 Per Job Tax Credit.Firms located within the Fayetteville SDZ enjoy this additional per job tax credit above the Cumberland County amount, totaling $ 7,000 Per Job Tax Credit.

MINIMUM JOBS……….. New Investment - all new jobs over 5 created. Expansion - all new jobs created.

WAGE STANDARD……. New jobs created have to meet the county wage standard to qualify for the tax credits.

EXAMPLE: 20 jobs minus 5 job minimum.
Cumberland County Tier 3 Job Tax Credit -15 jobs x $ 3,000 per job = $45,000
Fayetteville Development Zone Job Tax Credit -15 jobs x $ 4,000 per job = $ 60,000

TOTAL JOBS TAX CREDIT FIRMS LOCATING WITHIN FAYETTEVILLE SDZ - $ 105,000

INVESTMENT TAX CREDIT
Eligible investment in Machinery and Equipment (M&E) placed in service during the tax year, either leased or purchased, and capitalized by the taxpayer applying for the credit. Credits are taken over a 7-year period with a 5-year carry forward.

TAX CREDIT……………. 7% Tax Credit of Investment.

THRESHOLD…………… Cumberland County - $ 200,000 Investment in M&E Fayetteville SDZ - $ 0.00

WAGE STANDARD……. New jobs created have to meet the county wage standard to qualify for the tax credits.

EXAMPLE: $ 4 Million in Eligible M&E
Cumberland County…..$ 4M - $ 200,000 threshold = $ 3,800,000 x 7%
Credit = $ 266,000
Fayetteville SDZ…….. $ 4M - $ 0.00 threshold = $ 4,000,000 x 7%
Credit = $ 280,000

RESEARCH AND DEVELOPMENT TAX CREDIT
A taxpayer claiming federal income tax credit under 41(a) of the IRS Code for increasing research is allowed a North Carolina credit of 5% of the state's share of the amount determined for the research.

A taxpayer claiming the alternative incremental credit under section 41(c)(4) of the Code is allowed credit equal to 25% of the state's share of the federal credit claimed.

WORKER TRAINING TAX CREDIT

A taxpayer that provides worker training for five (5) or more eligible employees is allowed a credit equal to wages paid the eligible employees during training. Additional guidelines are:

Company must be eligible for the Jobs Tax Credit or the Investment Tax Credit

On the job training wages are not eligible

The average weekly wage of the workers trained must be equal to or greater than the county wage standard.

Worker Training Tax Credit………. Cumberland County - $ 500 per worker. Fayetteville SDZ - $ 1,000 per worker

CENTRAL ADMINISTRATIVE OFFICE CREDIT

A taxpayer that has purchased or leased property and begins its use for a central administrative office is allowed a credit equal to 7% of the eligible investment amount.

The maximum credit allowed for central administrative office property is $ 500,000.

CITY OF FAYETTEVILLE STATE DEVELOPMENT ZONE
Development Zones (DZ) located in eligible cities are treated as Tier 1 for purposes of the wage standard, the threshold for Machinery & Equipment Investment, and the credit for worker training. A taxpayer that contributes to a DZ agency for an improvement project is allowed credit equal to 25% of the value of the contribution. Such credits may not be taken in the year of the contribution, but in the tax year for which the application for credit becomes effective. The maximum for all credits to a taxpayer year for a DZ improvement project is $ 4 million. Tax credits are forfeited if it is found that a DZ agency has used project contribution funds for any purposes other than the improvement project. The company must meet the average weekly facilities wage standard.

ELIGIBILITY REQUIREMENTS FOR ALL TAX CREDITS

ELIGIBLE COMPANIES:

Primary Activity	NAICS Code	SIC Code
Manufacturing / Processing	31-33	2011-3999
Warehousing	493	4221-4226
Wholesale Trade	42	5012-5199
Air Courier Services	492110	4513
Central Administrative Offices (40 administrative jobs)	551114	Aux. Code 1, 6, 7
Electronic Mail Order (250 jobs), (Tiers 1& 2 only)	454110	4541
Data Processing		7371-7379
Computer Systems Design & Related Services	54151
Software Publishers	511210
Software Reproducing	334611
Data Processing Services	514210
On-Line Information Services	514191

A company's SIC/NAICS code must be in one of the categories listed above. The Employment Security Commission designates SIC/NAICS codes.

ELIGIBILITY REQUIREMENTS:

1. Qualifying SIC/NAICS code.
2. Company must pay 110% of the lowest of 3 wage factors of the project location(100% in Tier 1 or DZ). The company's average wage includes all employees of the facility and all cash compensation from which FICA is deducted. Compute from annual report.
3. Must provide health insurance for full-time positions, minimum 50% of premiums paid by the employer.
4. Has not had a significant environmental violation in the last 5 years.
5. Has no outstanding citation under the Occupational Safety and Health Act and has had no serious violation within the last 3 years.

APPLICATION FEE:

1. $ 500 per type of credit (Jobs, M&E, etc.) applied for up to $ 1,500 per taxpayer per tax year.
2. This fee is effective for all applications filed after 8/18/99 regardless of the year of application.
3. There is no application fee for companies located in Tier 1 & 2 or in a State Development Zone (for applications filed after December 31, 2000).

DEVELOPMENT ZONE:

Tax credit enhancements are available for companies located in designated Development Zones.

For more information about designation, including maps, please contact the Division of Community Assistance at 919.733.2850.

For more information visit our web site at http://www.nccommerce.com/finance.

Direct tax-related questions to the Department of Revenue at 919.733.8510.

The total value of tax credits cannot exceed 50% of the annual tax liability. All credits can be taken either on the income, franchise or gross premiums tax returns.

Last modified 8/00.
Department of Commerce Finance Center

Click here to download a Microsoft Word Document of the NC Incentive information

Return to top of Page

Return to Home Page