Enterprise Zone Tax Credits
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.
Regarding the Enterprise Zone program in Colorado, the Leeds School of Business stated "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."
Benefits to Colorado communities in fiscal year 2014 include:
- $2.2 billion invested in EZ communities, $1.1 billion of which was business personal property eligible for $32.7 million in EZ investment tax credits
- $52.9 million was invested in 32,000 employees through qualified job training programs. These businesses earned $5.29 million in EZ tax credits
- $2.6 million was invested in commercial vehicles operating in Enterprise Zones, incentivized by $32,317 in tax credits
- 4,052 new jobs were created where businesses earned incentives of $2.5 million
- 1,567 employees were provided employer sponsored health insurance by businesses starting out in EZs. These businesses earned tax credits worth $313,399
- Research and Development expenditures were up by $49.7 million over the previous 2 year average
- $1.62 million invested in hard-costs to revitalize vacant buildings for commercial use