Community Reinvestment Area Tax Incentive (CRA)
The tax exemption will first apply in the year the construction or remodeling would first be taxable. In the case of remodeling that qualifies for exemption, a percentage of the amount by which the remodeling increased the structure’s assessed value shall be exempt from real property taxation. In the case of construction of a structure that qualifies for exemption, a percentage of the structure’s assessed value shall be exempt from real property taxation. If the structure or remodeling is to be used for commercial or industrial purposes, the percentage and period set forth in the Agreement, which Agreement may include the following:
Up to ten (10) years and up to seventy-five percent (75%) for existing commercial and industrial facilities, the term and percentage of which shall be negotiated on a case-by-case basis in advance of construction or remodeling occurring.
Up to ten (10) years and up to seventy-five percent (75%) for new commercial or industrial facilities, the term and percentage of which shall be negotiated on a case-by-case basis in advance of construction occurring.
Mixed use facilities, (i.e., combined residential and commercial use), shall be treated as a commercial project in its entirety subject to the term length and percentages as set forth in subsections (a)(1) and (2) hereof.
If the structure or remodeling is to be used for residential purposes, the percentage and period may be one of the following:
Up to seven (7) years for the remodeling of every residential dwelling unit containing not more than two family units and upon which the cost of remodeling is at least $5,000.00, and with such exemption being up to one hundred percent (100%) for each year.
Up to seven (7) years for new residential construction consisting of not more than two (2) family units, and with such exemption being up to one hundred percent (100%) for each year.
Up to seven (7) years for the remodeling of every residential dwelling unit containing more than two family units upon which the cost of remodeling is at least $10,000.00, and with such exemption being up to one hundred percent (100%) for each year.
Up to seven (7) years for new residential construction consisting of more than two (2) family units, and with such exemption being up to one hundred percent (100%) for each year.
Some restrictions and permission from the local School District may apply depending on the level of abatement you are seeking. See Chapter 195 of the City’s Codified Ordinances for more information or call the Department of Planning & Community Development to set up an appointment to discuss your options.
Job Creation Tax Credit
The City also has its own Job Creation Tax Credit program for those businesses which make an investment in the City that creates new full-time jobs.
See Chapter 193 of the City’s Codified Ordinances for more information or call the Department of Planning & Community Development to set up an appointment to discuss your options.
City Revolving Loan Fund (RLF)
The City of Ashtabula‘s Revolving Loan Fund (RLF) program has been established to achieve the expansion and diversification of the Ashtabula economic base and to create increased employment opportunities, particularly for persons from low and moderate income households.
The RLF is designed to address financing problems faced by the local business community.
If your business/project meets the criteria below please contact Mary Church at 440-992-7195 or email@example.com for an application.
None of the improvements start prior to approval of the CDBG ED/RLF application & environmental review Release of Funds;
A financing gap can be identified i.e. the company either cannot get funds from any other source to complete the project (availability gap) and/or the company cannot afford to do the project at the rate/terms offered by the other lenders (affordability gap);
At least 51% of the jobs created will be for persons of low- and moderate-income (LMI);
At least 5% of the project will be financed with cash equity;
At least 15% of the project will be privately financed;
There is at least a 1:1 leverage ratio of CDBG to other funds; and
The cost per job does not exceed $25,000
Ashtabula County 503 Corporation Revolving Loan Fund
The Ashtabula County 503 Corporation was formed in 1983 as a private, non-profit corporation with the mission of promoting job creation and economic development in Ashtabula County.
To accomplish this mission, the 503 Corporation administers a Revolving Load Fund. The fund has been capitalized over the years with monies from State and Federal resources. These funds are loaned to businesses in Ashtabula County, usually below market rates. As the loans are repaid, with interest, the Load Fund money becomes available to lend to the next business in need of financing.
In addition to managing the Ashtabula County Revolving Load Fund, the 503 Corporation serves as the local contact agency for the Small Business Administration (SBA) 504 and State of Ohio Regional 166 loan programs.
Low Interest Loans
Growth Partnership works in conjunction with both the Mahoning Valley Economic Development Corporation (MVEDC) and the Lake County Port Authority to provide businesses with the opportunity to use the Regional 166 Fund and SBA 504 loans.
The Regional 166 Fund is used primarily by manufacturers, wholesalers and distributors and can offer up to 40% of project cost or $500,000 at a fixed rate of approximately 2/3 of prime rate. The term of the loan can be up to 10 years for equipment and up to 15 years for real estate. The MVEDC will share a first with bank required personal guarantees or letter of credit. This is a program driven by job creation therefore the amount you qualify for is based upon $50,000 lent for each job created. Prevailing wage must be paid for projects involving construction, with interim financing by a bank.
Small Business Administration 504 (SBA 504) loans are made to those in the service, commercial, retail, industrial or distribution business. The maximum loan amount is $5.5 million for manufacturers or 40% of the project cost up to $5 million for public policy goals with interest rates based on the treasury’s rates fixed. Loan term for SBA 504 loans are 10 years for equipment and 20 years for real estate with the lender holding a 2nd mortgage or lien and personal guarantees for the borrower. Again this loan program is driven by job creation so the loan amount a business qualifies for is based upon $65,000 per job created. SBA 504 requires interim financing by a participating bank.
Growth Partnership for Ashtabula County is the County level partner with the State of Ohio’s JobsOhio that helps to identify a businesses needs at the State Level. Some options include:
Low Interest Loans
The Ohio Development Services Agency (ODSA) offers a number of low interest loans and grants to entice business into the state of Ohio. There is the Ohio Enterprise Bond Fund, the 166 Direct Loan, the Pioneer Rural Loan, and the Rural Industrial Park Loan to name a few of the most commonly used.
The Ohio Enterprise Bond Fund is used when a project will induce a $1.5 million to $10 million investment in land and building acquisition, construction, renovation, and equipment purchases. The eligibility for this program is based on job creation and repayment and management capabilities, along with the use of Ohio prevailing wage. Up to 90% of the total project cost is eligible and the long-term fixed rates for up to 20 years will apply for commercial or industrial projects.
The 166 Direct Loan program provides low interest loans for land and building acquisition, expansion or renovation, and equipment purchases. The amount they lend ranges from $350,000-$1 million. You must have 10% equity and be in a “distressed” area as labeled by the State. To be eligible for this program you must retain one job for every $15,000 received and use prevailing wage on the site during project construction.
The Pioneer Rural Loan also provides loans for land and building acquisition, new construction, renovation and expansion of existing buildings and acquisition of machinery and equipment for businesses locating or expanding in Ohio’s rural areas. The maximum loan amount is $750,000 and cannot exceed 75% of total fixed asset costs. Eligibility requires that the project creates or retains 1 job for every $35,000 of state investment during the first three years of the project.
The Rural Industrial Park Loan provides direct loans and loan guarantees to applicants in “rural” or “distressed” communities who are dedicated to building a well-planned industrial park. This loan cannot exceed 75% of total eligible project costs and will not exceed the $1million mark.
The Ohio Development Services Agency (ODSA) offers a number of Tax Credits to businesses willing to locate in Ohio. The Ohio Job Creation Tax Credit (JCTC), the Training Tax Credit, and the Ohio Manufacturing Machinery and Equipment Investment Tax Credit are a few of the most commonly used.
The Ohio Job Creation Tax Credit (JCTC) is a state program that credits back state income tax for businesses that expand or locate in Ohio. The Ohio Tax Credit Authority determines the businesses eligibility for JCTC and the local community must also provide support for the project. JCTC is only an option when 25 or more new full-time positions are created.
The Training Tax Credit provides tax credits for employers that will train existing employees who could lose their jobs because of lack of training. Businesses will receive up to $100,000 per year. This program shows the states support for retention projects in the state.
The Ohio Development Services Agency (ODSA) offers a program called the Ohio Investment in Training Program (OITP). This program provides up to 50% reimbursement for instructional costs, materials and training-related activities with an emphasis on the manufacturing sector.
A complete list of the State’s incentives can be found on the following pages: