Colorado's Enterprise Zone (EZ) program provides tax incentives to encourage businesses to locate and expand in designated economically distressed areas of the state - those having a high unemployment rate, low per capita income, or a low population growth rate.
Why have a state Enterprise Zone program?
Private-sector business activity encouraged by these income tax incentives brings job opportunities and capital investment to economically distressed areas. The private investment results in tax revenue for school districts, cities, counties and the state, outweighing the cost of the tax credits granted.
Benefits of the EZ program to Colorado communities in fiscal year 2015 include:
- over $2 billion was invested in qualified business personal property - eligible for $61.5 million in EZ investment tax credits. As a part of the qualified business personal property investment, renewable energy investments totaled $292.7 million.
- businesses trained almost 34,000 employees that work in the Enterprise Zones, earning $9.5 million in EZ job training tax credits
- $1.5 million was invested in commercial vehicles operating in Enterprise Zones, incentivized by $22,772 in tax credits
- 3,551 new jobs were created where businesses earned incentives of $3.6 million
- 1,267 employees were provided employer sponsored health insurance by businesses starting out in EZs. These businesses earned tax credits worth $1.2 million
- EZ businesses increased investment in Research and Development by approximately $35 million, earning EZ credits of about $1.05 million.
- $2.4 million was invested in hard-costs to revitalize vacant buildings for commercial use (credits certified were $595k)
"Given the pervasiveness of enterprise zones and similar tax incentives across the nation (present in 39 states and Washington D.C.), it is imperative that Colorado maintain incentives in order to compete with other incentive‐rich states for business acquisition or retention." - Leeds School of Business