Firms getting incentives could transfer them

Colorado’s most popular economic development incentives provide companies with a credit to offset state income taxes based on the number of employees they hire or the investments made in economically distressed areas of the state.

But if companies aren’t profitable, the tax breaks aren’t of much use, something the state legislature tried to address by making those tax breaks transferable.

“We are trying to dot the i’s and cross the t’s,” Jeff Kraft, director of business funding and incentives at the Colorado Office of Economic Development, said of the new

guidelines being crafted.

The new law requires that companies make a $100 million strategic capital investment to be eligible to transfer any tax credits they receive. But what does that mean, exactly?

Kraft told the Colorado Economic Development Commission on Thursday that any investments should show up on a firm’s balance sheet and be focused on land, buildings, equipment and other hard-to-move assets.

The state will exclude assets that could easily be transferred to another state, such as aircraft or a fleet of vehicles. And it won’t count intangible assets such as goodwill.

Economic development staff are being careful as they craft the new guidelines, in part to avoid a repeat of criticism the state auditor poured on them in October for their supervision of the Regional Tourism Act program, which was saddled with inadequate reporting and poorly defined guidelines.

New guidelines for the RTA program should be in place by May or June, Kraft said. The office is also in the process of hiring a half-time position to oversee the various RTA projects.

The state continues to receive a steady stream of requests, and the commission approved three more Thursday under the job growth tax incentive program. The approvals will provide up to $5.1 million of tax breaks in return for the addition of 238 jobs over the next eight years.

The commission also OK’d three firms looking to launch operations and hire staff in Mesa County under the Rural Jump Start program: Pierce Corp., an Oregon maker of irrigation equipment; Phoenix Haus, a Grand Junction manufacturer of ultra-energy-efficient prefabricated homes; and Rocky Mountain Manufacturing, a Grand Junction firm that is looking to mass produce a low-cost and easyto-use prosthetic ankle joint.