$5 million reasons to site your engineering firm in Greater Wichita
Posted on Tue, Oct. 18, 2011
The Associated Press
The Kansas Department of Commerce has been awarded a four-year, $5 million grant to help train more engineers for the workforce. The funds are from the U.S. Department of Labor.
State Commerce Secretary Pat George says the grant fits with a program approved this year by Kansas lawmakers aimed at graduating more engineering students from state universities.
George says the federal grant is intended to reduce the number of foreign workers hired in the United States. It will be funded from the fees paid by employers who hire foreign workers under a federal visa program.
Kansas employers can apply for funds from the grant to provide training for engineering graduates and for qualified engineers who are unemployed.
State of Kansas Incentives
Enterprise Zones Manufacturing businesses can receive sales tax exemptions and state income tax credits if they create a net of two new jobs. Non-manufacturing businesses must create a net of five new jobs. Retail businesses in Sedgwick County are not eligible for Enterprise Zone benefits. The benefits are:
- 100% sales tax exemption on construction materials and labor, machinery and equipment, and furniture and fixtures
- Job creation tax credit - $1,500 per employee (one-time credit)
- Investment tax credit - $1,000 per every $100,000 of investment (one-time credit)
- Earned credits are available until fully utilized
High Performance Incentive Program
Companies may be eligible for a Kansas Income Tax Credit equal to 10% of eligible capital investment that exceeds $50,000. This credit has a 10-year carry-forward provision and may offset 100% of a firm's annual tax obligation. There is also a sales tax exemption similar in scope to the Enterprise Zone sales tax exemption. The company must:
- Pay above average wages for the industry.
- Invest at least 2% of payroll in training or participate in one of the state's workforce training programs.
- Otherwise eligible non-manufacturing worksites must also show that more than half of worksite revenues are from sales to specific kinds of customers, or else the worksite must be a headquarters or a back-office/support worksite of a national or multi-national corporation.
- Fall into major NAICS category 221, 311-425, 481-721, or 811-928 (generally excluded from eligibility are retailers and businesses involved in agriculture, construction and mining, unless the worksite is a headquarters or back-office of a national or multi-national corporation).
KIR (Kansas Industrial Retraining)
This program provides training assistance to companies in industries that are restructuring due to changing technology and to companies diversifying production activities. Terms are negotiable and cover up to 50% of retraining costs.
City of Wichita/Sedgwick County Incentives
IRBs (Industrial Revenue Bonds)
The City of Wichita and/or Sedgwick County may exempt property financed with IRBs from property taxes for a period of up to ten years. Building materials and equipment permanently installed will be exempt from state and local sales taxes. Additional information
Abatement of Property for Economic Development Purposes
Wichita and Sedgwick County may abate ad valorem taxes on all or any portion of the appraised value of all buildings or added improvements used exclusively by a business for:
- Manufacturing articles of commerce;
- Conducting research and development; or
- Storing goods or commodities which are sold or traded in interstate commerce.
Additions to or expansions of existing buidlings qualify for the property tax exemptions if, as a result of the expansion, new jobs are created. Total or partial ad valorem tax may be in effect for up to 10 years after the calendar year in which a business commences its operations or an expansion is completed. There is no personal property tax on machinery and equipment purchased after June 30, 2006.
EDX (Kansas Constitutional Amendment)
The Wichita City Council and the Board of Sedgwick County Commissioners may exempt property from taxation for a period of up to ten years. This may include all or any portion of both real and/or tangible personal property used exclusively in:
- Manufacturing articles of commerce
- Conducting research and development
- Storing goods or commodities which are sold or traded in interstate commerce
- See PDF application in download section
Business Machinery & Equipment Property Tax Exemption
Effective July 1, 2006, business machinery and equipment newly purchased, leased or moved into Kansas is exempt from property tax. This is of particular benefit to capital-intensive manufacturing operations. The exemption applies equally to manufacturing equipment and office business equipment, furniture and fixtures. Items of business personal property under $1,500 original purchase price are also exempt from property tax regardless of date of purchase.
Business Inventory Property Tax Exemption
Effective January 1, 1989, merchant and manufacturer business inventories (raw materials, goods-in-process and finished goods) are exempt from property tax by Kansas constitutional amendment.
Foreign Trade Zone
The Sedgwick County Foreign Trade Zone is a general-purpose zone where foreign and domestic goods are not within U.S. Customs territory. Users are thereby exempt from paying duty or federal excise tax while goods remain in the zone or are exported. If final product is imported into the United States, import tax or duty is due only at the time of transfer. Additional information
Trade Show Assistance Program
Assistance is available for up to one-half of a company's direct foreign exhibition-related expenses (not to exceed $3,500 per show and $7,000 annually). Reimbursable expenses might include booth space, utility costs, transportation of equipment or materials, booth assembly/disassembly, interpreter fees at the show, translation fees for materials, etc. Additional information
Income Tax Credit for Research & Development
A company can qualify for an income tax credit for research and development if: Research and development occurred within the state of Kansas Expenditures increased above the company’s average expenditures for such activities during the prior two years. Tax credit is equal to 6.5% of the increased expenditure amount and is deductible over a 4-year period (25% annually). Additional information