RD108 - Annual Report for the Virginia Enterprise Zone Program (2003 Tax Year)


Executive Summary:
The reporting requirement of Item 112 B. (Chapter 4, 2004 Special Session I) has also been met in this report.

The General Assembly established the Virginia Enterprise Zone Program in 1982, through passage of the Virginia Enterprise Zone Act (§ 59.1-270 through § 59.1-284 of the Code of Virginia). The program stimulates overall economic growth and neighborhood revitalization by providing tax and financial incentives to businesses operating in economically distressed localities throughout the state. These incentives make doing business in Virginia's distressed communities more attractive.

The program operates as a partnership between the state and localities to encourage business development and expansion in the state's designated enterprise zones. State tax incentives, local regulatory flexibility, and local infrastructure development support businesses and encourage new business activity within the zones. New or expanding businesses located within or relocating to one of the designated enterprise zones have the opportunity to apply for valuable state and local incentives.

The Virginia Department of Housing and Community Development administers the Enterprise Zone Program guided by the Virginia Enterprise Zone Program Regulations. These regulations establish the criteria and procedures for the designation, amendment, and administration of enterprise zones along with qualification criteria for participating businesses. Although the Department of Housing and Community Development (DHCD) administers the program, the determination of local economic development objectives, selection of local incentives, and management and marketing of the zone are the responsibilities of local government. Once designated, local governments must conduct a survey of zone business conditions and make surplus public land within the zone available for sale. Each zone locality must also submit an annual report of zone activity and investment to DHCD.

As part of the administration of the state's component of enterprise zone incentives, DHCD qualifies businesses for state incentives. DHCD qualified the first businesses for the program in 1984, and more than 1,400 businesses have received incentives since then.