FAQ
What does basic employment mean?
Basic employment means employment in an industry sector or function that directly or indirectly derives more than 50% of the its revenue from out-of-state sources.
What capital expenditures do not count as Capital Investment?
Capital Investment does not include expenditures for the maintenance or repair of existing machinery and tools and real property. However, expenditures for the replacement of property may be eligible as Capital Investment if it results in a measurable increase in productivity.
The value of real or personal property leased under a capital lease will count as Capital Investment.
The value of real or personal property leased under an operating lease may count as Capital Investment if (i) the operating lease is for at least ten years, (ii) the real property would not be constructed or improved “but for” the company’s interest in leasing some or all of the facility, and (ii) if, for an improvement project, the improvements will significantly increase the taxable value of the property.
Generally, the value of used equipment transferred by the company to the project site will not count as qualifying capital investment.
Capital expenditures funded by proceeds of a grant from the Commonwealth or other contributions by local or regional government entities do not count as Capital Investment.
What positions do not qualify as New Jobs?
Seasonal or temporary positions, positions created when a job function is shifted from an existing location in the Commonwealth, retail positions, and positions with construction contractors, vendors, suppliers, and similar multiplier or spin-off jobs do not qualify as New Jobs.
Are contract employees allowed to count as new jobs?
Dedicated, full-time, Virginia-based contractor employees may be considered as New Jobs so long as such employees meet the requirements of a New Job.
When must a CED Plan be updated?
If a CED Plan relates to general economic development and diversification efforts, the CED Plan must be updated at the time of the Application Requesting Certification as Certified Company Pursuant to Collaborative Economic Development Plan to indicate the company eligible for certification as a Certified Company and for which the Participating Localities may be awarded a CED Grant.
When will a CED Grant be paid?
The first annual payment of the a CED Grant will be paid in the fiscal year following certification as a Certified Company and Board approval of the CED Grant. Any additional CED Grant payments will be in each fiscal year thereafter. The Board may approve a CED Grant for up to six years.
Is there a maximum aggregate amount of annual CED Grants to Participating Localities?
The aggregate amount of the annual CED Grants awarded to the Participating Localities may not exceed 50% of the total investment or contributions by the Participating Localities in the CED Plan.
If the Board has made a finding of significant fiscal distress or extraordinary economic opportunity for the Participating Localities, the aggregate amount of the annual CED Grants may be up to 100% of such total investment or contributions.
When the Board is considering the aggregate amount of annual CED Grants, what is the required form of the investment or contributions by the Participating Localities in the CED Plan?
Such investment and contributions may take the form of cash, revenue sharing, the dedication of locally-owned or controlled assets to the project, reallocation of existing funds, in-kind contributions, or other local resources.
What can a CED Grant be used for?
A CED Grant must be used for economic development activities aligned with the CED Plan including:
- Public and private utility extension or capacity development on and off site; public and private installation, extension, or capacity development of high-speed or broadband Internet access, whether on or off site; road, rail, public transportation, or other transportation access costs beyond the funding capability of existing programs; site acquisition; grading, drainage, paving, and any other activity required to prepare a site for construction; construction of publicly or privately owned buildings or build-out of publicly or privately owned buildings; training; grants or loans to an industrial development authority, housing and redevelopment authority, or other political subdivision for purposes directly relating to any of the foregoing; workforce training initiatives, or career and technical education at the secondary education level that assist targeted industries identified in the Economic Growth and Diversification Plan of the associated region; environmental costs such as nutrient trading credit trading, permit costs and so forth; workforce housing; small business assistance to assist with local supply chain and services; or other uses approved by the Board that will enhance broad based economic cooperation. In no case may funds be used, directly or indirectly, to pay or guarantee the payment for any rental, lease, license, or other contractual right to the use of any property.
A CED Grant may not be used to provide a grant back to the company.
When must a CED Plan be approved and/or updated?
If a CED Plan relates to general economic development and diversification efforts, the CED plan may be submitted for approval prior to the identification of a specific economic development project or potential Certified Company. Otherwise, the CED Plan may be submitted upon the identification of a specific economic development project or potential Certified Company.
A CED Plan must be updated at the time of the filing of a Certification Application if it relates to general economic development and diversification efforts
How does the Board make a determination of significant fiscal distress or extraordinary economic opportunity for Participating Localities?
Such a determination will be made on a case-by-case basis. Participating Localities will be required to submit documentation as to why the Participating Localities are fiscally distressed or why the Participating Localities believe a project is an extraordinary economic opportunity.
When the Board is considering the aggregate amount of annual CED Grants, what is the required form of the investment or contributions by the Participating Localities in the CED Plan?
Such investment and contributions may take the form of cash, revenue sharing, the dedication of locally-owned or controlled assets to the project, reallocation of existing funds, in-kind contributions, or other local resources.
What does substantial reduction in New Jobs or Capital Investment mean?=
Substantial reduction means either (i) the Capital Investment remaining at the end of the reporting calendar year is less than the Capital Investment remaining at the end of the previous calendar year because the Capital Investment was either removed from the Certified Company’s facility or idled, (ii) the Capital Investment was sold or otherwise disposed of, without an offsetting additional Capital Investment, or (iii) the number of New Jobs remaining at the end of the reporting calendar year is 10% less than the number of New Jobs remaining at the end of the previous calendar year.
What happens if Certified Company has a substantial reduction in New Jobs or Capital Investment, or if one or more of the Participating Localities has not continued to perform any relevant portions of the CED Plan?
No further grant payments will be made if there is a substantial reduction in new Jobs or Capital Investment. No further grant payments will be made until all such obligations have been met. Please note that in the case where a CED Plan is among three or more Participating Localities, the other two Participating Localities may step in to perform the required obligations.