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California releases list of firms getting tax credits

Posted: July 2, 2014 4:46 p.m.
Updated: July 2, 2014 4:46 p.m.
 

California released the final list of companies selected for the first allocation of tax credits under the Governor’s ‘California Competes’ program.

No Santa Clarita-based companies were on the list.

Originally a committee recommended 31 companies, but only 29 made the final cut. Those 29 companies are now eligible for tax credits totaling nearly $30 million, according to a statement the Governor’s Office of Business and Economic Development, GO-Biz.

Loosely structured, the program is intended to support companies that show real promise in elevating economic productivity in the state through growth and by providing higher-wage jobs.

The tax credits are offered to existing companies interested in expanding, as well as to those interested in relocating to or investing in California.

The companies selected in this round, however, are all California-based companies with the exception of Matheson Tri-Gas, Inc. – which has a number of operations in California.

While not certain if any Santa Clarita companies applied this first go-round, Brady Bryan, founder of Brayn Consulting in Santa Clarita, said it was interesting that 11 small businesses with less $2 million in gross receipts were recommended for the for tax credits.

While Bryan’s firm consults with businesses on a number of programs, including California Competes, the deadline for the first round of the state’s new tax credit program came in the middle of tax season in April, making it difficult for companies to focus on the new program, he said.

Only 396 companies statewide applied for the program, requesting over $500 million in total credits, according to the Governor’s economic office.

According to the GO-Biz office, the 29 companies selected have the potential to create some 6,000 jobs and spur more than $2 billion in investment across California with the help of the tax credit program.

The companies selected represent industries such as manufacturing, biotech, agriculture, food processing, aerospace, high tech, clean tech and more.

Unlike other tax incentive programs, this one has a competitive selection process and must be able to demonstrate how the credits will help to create jobs, according to State Treasurer Bill Lockyer, a member of the California Competes Tax Credit Committee.

“A lot of companies in Santa Clarita probably have a good opportunity to compete for the tax credits,” Bryan said. “We’d love to have one or two companies out here benefit.”

The California Competes program was introduced after the state’s Enterprise Zone program was eliminated, which made hiring tax credits available to any company operating within designated geographic zones.

“It’s a not a silver bullet answer for California’s woes, but California Competes shows businesses that California is here to compete,” Bryan said.

The good news, he said, is the program is only going to expand.

The next batch of applicants will be eligible for another round of incentives, $150 million worth.

On June 30, the new time window to apply for the next round of credits will be announced.

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