Economic Development Division Program Overview
Sandia Biofuel Research Alexander s Plumbing, Farmington Compass Components, Inc., Deming Introduction The New Mexico Economic Development Division s primary mission is to assist businesses that create jobs in New Mexico. Our objective is statewide employment and long-term sustainable growth within New Mexico. Our services range from structuring business deals, offering and assisting with incentives and providing programs for your company. Listed in this brochure are the programs and services available for companies operating in New Mexico. Office of International Trade (OIT) The Office of International Trade supports job creation, retention and expansion by assisting New Mexico companies in capitalizing on opportunities in the competitive global market place. OIT promotes and facilitates business export sales of New Mexico goods and services worldwide. Services Provided by OIT Include: One-on-one business consultations A network of foreign trade offices Export promotion programs in partnership with the federal government A series of workshops and seminars to recruit New Mexico companies for participation in international trade events For more information about OIT or to schedule an international trade consultation, please contact Edward Herrera at 505.827.0315 or Edward.Herrera@state.nm.us. PROGRAMS/services Office of Business Advocacy (OBA) The Office of Business Advocacy was created in January 2011 as an initiative of Governor Susana Martinez and New Mexico Economic Development Department (NMEDD) Cabinet Secretary Jon Barela. In FY12, OBA assisted in the creation of 844 jobs and retained 682 jobs by assisting 80 specific companies. OBA enables business owners to break through regulatory barriers and red tape by helping them navigate through state government by providing assistance with permitting, licensing, inspections and taxation issues. For more information on the OBA, contact Dora Dominguez, OBA Director, at 505.827.0089, Dora.Dominguez@state.nm.us ISO 9001 Certification ISO is a set of quality management standards recognized by more than 178 countries. There are more than a million companies worldwide that have registered to the ISO standards. Most major companies and agencies of the U.S. Government require their suppliers to be ISO compliant. ISO certification can be a lengthy and expensive process, which is why the New Mexico Economic Development Department created New Mexico 9000. Through New Mexico 9000, businesses may prepare for ISO 9001 certification and pay a sliding scale fee based on their gross receipts. The New Mexico 9000 process only takes six months Trained professionals with extensive experience in ISO implementation will conduct workshops For more information about the New Mexico 9000 Program, contact Carlos Beserra at 505.827.0230, Carlosj.Beserra@state.nm.us, or go to: http://nm9000.org/. 2
Questa Industrial Park Ribbon Cutting Roswell International Air Center FinancE Development Team (FDT) The Finance Development Team assists new and existing businesses by providing financing tools available within New Mexico. Through FDT, companies are provided detailed information on tax incentives and financial assistance programs. A customized analysis of the incentives and state programs can be provided along with a financial analysis of a business to ascertain financial soundness. Finance Development Team Services 1. Introduction to all business incentives, such as Rural Jobs Tax Credit, High Wage Jobs Tax Credit, Investment Credit Act, and specialized industry tax credits which may result in cost savings for businesses 2. Financial packaging (debt or equity) and/or accessing capital 3. Review and interpretation of company financial statements 4. In-depth financial analysis and client consultations concerning all aspects of doing business 5. Facilitation of financing programs like the Collateral Support Loan Participation Program, New Markets Tax Credit, USDA, SBA, IRBs, and various Improvement & Infrastructure Districts 6. Incentive analyses for businesses 7. Economic impact analyses for communities to assess the prospective business development project which determines the ROI on a business development project Programs Promoted by the Finance Development Team: A. Local Economic Development Act (LEDA) Capital Outlay NMEDD is granted authority to administer grants to local governments that stimulate economic development pursuant to the LEDA. Funding of grants is strictly based on the receipt of Capital Outlay funds (General Fund and/or Severance Tax Bond) allocated from the state legislature. NMEDD targets economic development projects that comply with all legal facets of LEDA and that meet certain department goals tied to wealth creation, job creation and community support. B. Collateral Support Loan Participation Program (CSP) In 2011, New Mexico was authorized to receive $13.1M from the U.S. Department of Treasury as part of the State Small Business Credit Initiative provided through the Small Business Jobs Act of 2010. The New Mexico Finance Authority (NMFA) administers these funds on behalf of the state through the CSP. In addition, the NMFA assists qualified governmental entities in the financing of capital equipment and infrastructure projects at any stage of completion from preplanning through construction by providing low cost funds and technical assistance. NMFA program information can be found at www.nmfa.net. The CSP is able to quickly fund and efficiently lower the interest rate paid by the business and mitigate the bank s risk. This allows companies to obtain the capital required to leverage private lending. The CSP utilizes a streamlined, single application process where the NMFA maintains the relationship with the bank and the bank maintains the relationship with the borrower. In order to qualify for funds through the Collateral Support Loan Participation Program, a small business must: 1. Be located in New Mexico 2. Use the loan proceeds for business purposes 3. Be a non-profit corporation or a for-profit corporation, partnership, limited liability company or partnership, sole proprietorship, cooperative or other entity that is authorized to conduct business in the State of New Mexico 4. Have 500 or fewer employees 5. Meet the bank s lending requirements with the exception of the deficient collateral 3
2012 graduating class, New Mexico 9000 Program MainStreet Zuni, photo by Elmo Baca Business Incentives Overview New Mexico offers premium incentives for aspiring businesses to thrive and continue long-term sustainable growth. Our incentives range from employee training to rewarding highwage job creation. Listed below are incentives, programs and institutional support that eligible businesses within New Mexico can utilize. Basic Business Incentives Job Training Incentive Program (JTIP) JTIP offers financial support for hiring new employees, from New Mexico s smallest rural businesses to the largest big-city companies. JTIP reimburses qualified companies for a significant portion of the expenses associated with training new hires in newly created jobs: Reimbursement of a significant portion of wages during the initial month(s) on the job Reimbursement for cost of customized training provided by educational institutions for qualified new hires Reimbursement percentage ranges from 50 percent to 75 percent, depending on the business location STEP-UP Training Program STEP-UP was established as a supplement to JTIP to assist qualified companies with job training for their existing workforce. The STEP-UP Training Program reimburses qualified companies for a portion of direct training costs associated with enhancing the job skills of incumbent employees. Allowable activities for STEP-UP include, but are not limited to: training to upgrade existing skills or provide new skills to incumbent workers. For more information on eligibility and application requirements for JTIP and STEP-UP, contact Sara Haring at 505.827.0249, Sara.Haring@state.nm.us. High-Wage Jobs Tax Credit Companies may take a tax credit equal to 10 percent of the combined value of salaries and benefits for each new, economic based job paying a minimum of $28,000 per year in rural areas and $40,000 per year in urban areas. Eligibility for the High-Wage Jobs Tax Credit is subject to qualified jobs, employers and employees: The company must have acquired more than 50 percent of its sales to persons outside New Mexico during the most recent 12 months The employee must be a resident of New Mexico and cannot be a relative of the employer or own more than 50 percent of the company. The credit also provides direct reimbursement Rural Jobs Tax Credit Employers receive a tax credit of 6.25 percent of the first $16,000 in wages for up to two years (4 years in urban areas). If the amount of credit exceeds a company s tax liability, the excess may be carried forward up to three years. Companies must be approved for JTIP before receiving the credit, which means that companies must manufacture or produce a product in New Mexico and be a non-retail service company that exports a substantial percentage of services out of state (50 percent or more of revenues and/ or customer base). New Markets Tax Credit (NMTC) The NMTC program is administered through the New Mexico Finance Authority in collaboration with NMEDD. The goal of the NMTC program is to spur revitalization efforts in low income and impoverished communities across New Mexico The NMTC provides tax credit incentives to investors for equity investments in certified Community Development Entities, which invest in low income communities 4
Game Production Service, LLC, Albuquerque Sandia Biotech Inc., Albuquerque Ideum, Corrales Investment Tax Credit for Manufacturers Manufacturers may take a credit against gross receipts, compensating or withholding taxes equal to 5 percent of the value of qualified equipment imported and put into use in a manufacturing plant in New Mexico (minimum value is $500,000 per one job created). Technology Jobs Tax Credit This credit has two parts: a basic credit and an additional credit, each equal to 4 percent of the qualified expenditures on qualified research at a qualified facility This credit amount doubles for expenditures in facilities located in rural New Mexico (as defined for this tax credit as anywhere outside Rio Rancho or more than 3 miles outside Bernalillo, Doña Ana, San Juan or Santa Fe counties) This credit may NOT be claimed under an IRB Business Tax Credits Research and Development Small Business Tax Credit If at least 20% of a company s annual expenses are for qualified research and development activities, small businesses with a minimum of 25 employees may receive a tax credit equal to the sum of all gross receipts and compensating and withholding taxes owed to the state. Angel Investment Tax Credit Any taxpayer who files a New Mexico income tax return and who is a qualified investor may take a tax credit of up to $25,000 (25 percent of a qualified investment no more than $100,000) for an investment made in a New Mexico company that is engaging in high-technology research or manufacturing. The taxpayer may claim the Angel Investment Tax Credit for up to two qualified investments in a taxable year, provided that each investment is in a different qualified business Any portion of the Angel Investment Tax Credit remaining unused at the end of the taxpayer s taxable year may be carried forward for three consecutive years The Angel Investment Tax Credit eligibility is established through the New Mexico Economic Development Division Veterans Tax Credit Taxpayers who employ qualified military veterans in New Mexico are eligible for a credit against the taxpayer s personal or corporate income tax liability in an amount of up to $1,000 of the gross wages paid to each qualified military veteran by the taxpayer during the taxable year for which the return is filed. Construction GRT Tax Incentive Companies with receipts from selling a construction service or a construction-related service may be eligible to have those receipts deducted from gross receipts Manufacturing GRT Incentive Companies tracking their receipts from selling tangible personal property may be eligible to have those receipts deducted from gross receipts or from governmental gross receipts if the sale is made to a person engaged in the business of manufacturing who delivers a non-taxable transaction. Industry Specific Tax Credits Advanced Energy Tax Credits, Alternative Energy Product Manufacturer s Tax Credit, Biodiesel Blending Facility Tax Credit, and Capital Equipment Tax Credit Intergovernmental Business Tax Credit (Native American Land), Renewable Energy Production Tax Credit, and Solar Market Development Income Tax Credit Sustainable Building Tax Credit, GRT Deduction for Sales of Uranium Hexafluoride, Ground Water Qualifying as a Geothermal Resource, and Tax Credit for Electricity Conversion and Exchange For more information on business incentives or for help finding the program that best fits your needs, please contact Antoinette Vigil, 505.827.0264, Antoinette.Vigil@state.nm.us; or Juan Torres, 505.827.0238, Juan.Torres@state.nm.us. 5
C/D Squared Enterprise, Gallup NASA at White Sands Community Assitance Community, Business and Rural Development Team (CBRDT) The CBRDT, more commonly known as regional representatives, assist communities in building their capacity for development by: 1. Training local leadership 2. Engaging diverse community stakeholders in the process of planning and implementing change in their regions 3. Helping to identify strategic opportunities to advance the regions goals for economic growth The regional representatives live in the regions they serve and work hand-in-hand with companies to introduce them to tax incentives, the Job Training Incentive Program and community development programs Regional representatives have helped 79 New Mexico communities pass a Local Economic Development Act (LEDA). Through passing LEDA, a community adopts an ordinance creating an economic development organization and a strategic plan. This empowers communities to embark on economic development projects tailored to their needs Certified Community Initiative Program (CCI) Encourages New Mexico communities in their efforts to create new jobs The initiative seeks communities who can demonstrate broad local involvement and who wish to empower their citizens, build on existing resources and expand their capacity to facilitate economic growth To better serve communities that are working toward the goal of CCI, a phased in approach of capacity building has been designated. This phase of the program is called CCI- Capacity Assistance Phase (CAP) Tribal Liaison Program The Tribal Liaison Program aids in helping New Mexico Tribes, Nations and Pueblos overcome barriers and allow opportunities for economic development The Program serves to gather input from New Mexico s Native American community on existing programs and how effectively the programs serve the Native American Tribes, Pueblos and Nations For more information on the Tribal Liaison Program, the CCI Program, or the CBRDT (regional representatives), please contact Ruben Fragoso at 505.795.0310, Rubeni.Fragoso@state.nm.us. Business Incubator Program The purpose of the Business Incubator Program is to provide advice to small business development. The Program provides unique services to the entrepreneurial community through mentoring businesses that have completed a business plan and are ready to take advantage of the vast array of technical services and on-site infrastructure. New Mexico Has Six Facilities That Have Been Certified: South Valley Economic Development Center (Albuquerque) Santa Fe Business Incubator WESST Enterprise Center (Downtown Albuquerque) San Juan College Quality Center for Business (Farmington) Arrowhead Technology Center at New Mexico State University (Las Cruces) Clovis Business Incubator For more information on the Business Incubator Program, contact Elizabeth Davis at 505.827.0333 or Elizabeth.Davis@state.nm.us. 6
BTI Groundbreaking, Santa Fe Exagen Lab Techs, Albuquerque Clayton Façade Squad New Mexico MainStreet Program In 1984, the New Mexico State Legislature created the New Mexico MainStreet (NMMS) Program, charging it with using a preservation-based approach to revitalizing the state s traditional commercial centers. NMEDD is licensed and accredited annually by the National Main Street Center, Inc. to provide professional technical assistance, services and resources to affiliated local MainStreet programs. There are currently 27 local MainStreet programs statewide. Each community works with the state as a public-private collaboration utilizing the National Main Street Center s trademark Four-Point Approach to commercial district revitalization. This approach relies on implementation of strategies in the following areas Promotions, Economic Positioning, Design and Organization. NMMS staff and consultants provide training and technical assistance to build local capacity and leadership; sustain local MainStreet organizations; design streetscape and façade improvements; conduct market analyses; provide small business support strategies; and develop the district as a destination for community residents, visitors and tourists. NMMS also offers capital outlay funds for district master plans and priority projects; educational opportunities; scholarships for leadership development; seed grants for local, volunteerdriven design initiatives; grant development support; training to utilize economic development financial tools and much more. For Calendar Year 2012, NMMS Districts Reported: 134 Net New Businesses 135 Private Building Renovations $16,912,000 in private sector reinvestment 25,454 Volunteer hours 622 Net New Jobs Arts and Cultural District Program One of the first programs of its kind in the nation, the Arts and Cultural District (ACD) Program was created in 2007 by the State Legislature in recognition that the cultural economy is the second largest net revenue generator for the state. The ACD program promotes place-based economic development by leveraging arts, cultural and heritage assets to grow the local economy in each state-authorized district. There are currently six ACDs: Downtown Albuquerque, Las Vegas, Los Alamos, Raton, Silver City, and Taos. State-Authorized Arts and Cultural Districts Must Have the Following Qualities: A district size that can be managed with available funding and resources and is the area of focus for future projects and funding requests The majority of arts and cultural assets are within district boundaries A high percentage of buildings dedicated to the creative and/or cultural economy The district has a unique destination or district center The district is a compact and walkable area Benefits of Becoming a State-Authorized ACD Include: A Resource Team visit and district evaluation Funding to develop a municipally-adopted Cultural Plan and Master Plan for the ACD Statewide marketing and branding Technical assistance to develop a local steering committee and annual work plan Doubling of State Historic Tax Credits for restoration of eligible commercial properties Development of financial tools to support cultural economy infrastructure and capital improvements within the ACD For more information go to: www.nmmainstreet.org and www.nmartsandculturaldistricts.org or contact NMMS Director/ACD Coordinator Rich Williams at 505-827-0168, rich.williams@state.nm.us 7
The New Mexico Economic Development Department makes every effort to provide current and accurate information and data. The incentives described in this brochure are subject to amendment by the legislature and regulatory interpretation or other action by administrative agencies and may be subject to a cap or other limitation on expenditures. Please contact us regarding any changes to incentives or questions about eligibility. 1100 South St. Francis Dr. Santa Fe, NM 87505-4147 505.827.0300 800.374.3061 FAX: 505.827.0328 www.gonm.biz This brochure is for illustrative purposes only and is intended to provide a general review of programs and policies described. It is not a contract. (c) 2014 New Mexico Economic Development Department