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Incentives through the City of Frankenmuth For information, contact This e-mail address is being protected from spambots. You need JavaScript enabled to view it at 989.652.3430 ext 120. P.A. 198 Tax Abatement - Industrial Facilities ExemptionFrankenmuth is very favorable to offering tax abatements to qualified businesses on new facilities and equipment with a minimum value of $75,000 . The P.A. 198 tax abatement program provides a 50% abatement for up to 12 years on real property and for up to 6 years for machinery and equipment. Instead of the property tax, the firm pays an Industrial Facilities Tax (IFT) that reflects the abatement savings.Eligible Facilities include Industrial plants who primarily manufacture or process goods or materials by physical change. Related facilities of Michigan manufacturers such as offices, engineering, research and development, warehousing or parts distribution are also eligible for exemption. Companies who qualify as "High technology companies" may receive an.exemption to apply the abatement to buildings, building improvements, machinery, equipment, furniture, and fixtures. Land is specifically excluded from the benefits of the act and is fully taxable. While this is enabled through the City, the State of Michigan qualifies companies for tax abatements. Tax Increment Financing (TIF)The City of Frankenmuth has an established Downtown Development Authority (DDA) and Tax Increment Finance District (TIF). Under the authority of DDA, the City may use captured taxesearned from new investment and increased property values to pay for water and sewer, roads, environmental testing and other public investments within the development district. The funds may be used for either industrial or commercial projects. Qualified projects will be located in the DDA district and approve a development agreement with the DDA and approved by the City Council.Brownfield Redevelopment (SBT Credit) The City of Frankenmuth is located within the Saginaw County Brownfield TIF district. Under the Brownfield Redevelopment program, buyers of contaminated sites can take title to environmentally impaired property without assuming liability for existing contamination, provided the buyer conducts a baseline environmental assessment (BEA) and discloses it to the state. Projects within the City of Frankenmuth may capture tax revenues generated by developer's projects to pay for eligible environmental costs, due care activities, and additional response activities. The mechanism for capturing these taxes is a Brownfield Plan that is approved by both the local unit of government and the Brownfield Redevelopment Authority. In addition, a Brownfield plan may also provide a Single Business Tax (SBT) Credit equal to 10/% of the costs of eligible investment (including building and equipment) on the Brownfield site up to a maximum credit of $30 million. MBT Brownfield Tax Credit
Managed by the State of Michigan, a Brownfield Tax Credit provides a business tax credit for the redevelopment or improvement of a contaminated, functionally obsolete, or blighted property —up to 12.5 percent of the eligible investment costs incurred to redevelop or expand the eligible property in the tax year. Incentives through the County of SaginawContact This e-mail address is being protected from spambots. You need JavaScript enabled to view it at 989.754.8222 Saginaw County Revolving Loan FundThe Saginaw County Revolving Loan Fund (RLF) is available for companies making new investment and creating jobs in Saginaw County. Funds may be used for working capital or fixed assets. Eligible businesses are manufacturing companies, high tech firms, or distributors. The program is administered by Saginaw Future Inc. and all applications are reviewed by the County Revolving Loan Fund Board. IDRB - Industrial Development Revenue BondsThe Industrial Development Revenue Bond program is tax exempt financing for fixed asset purchases. The Saginaw County Economic Development Corporation (EDC) authorizes issuance of the bonds that are sold to single or multiple investors. The Michigan Economic Development Corporation (MEDC) also has a statewide program to issue IDRB's through the Michigan Strategic Fund. Saginaw Future Inc.'s staff can assist in pursuing these tax-exempt bonds from either source. Incentives through the State of Michigan Contact This e-mail address is being protected from spambots. You need JavaScript enabled to view it at 989.754.8222. Michigan Economic Growth Authority (MEGA)Companies that are financially sound and have solid project proposals may be eligible for a refundable Michigan Economic Growth Authority (MEGA) tax credit against the Michigan Single Business Tax. Companies engaged in manufacturing, R&D, wholesale and trade, and office operations are eligible. Retail facilities are not eligible. Each credit may be awarded for up to 20 years and up to 100% of the amount of the project. Factors governing the amount and duration of MEGA Credits:
High-Tech MEGAHigh-tech companies may be eligible for tax credits against the Single Business Tax through the Michigan Economic Growth Authority. High Tech companies include businesses whose activity includes high-technology activity, and that use at least 25 percent of its total operating expenses for research and development. High-tech activity includes computing; advanced materials; biotechnology, but not cloning or stem cell research with embryonic tissue; electronic device technology; product research and development; advanced vehicle technology; and medical device technology. Minimum eligibility for credit:
High-Wage MEGA Tax CreditNegotiated credit against the Single Business Tax for companies conducting manufacturing, R&D, wholesale trade and paying 150 percent of the federal minimum wage. MEDC Economic Development Job Training (EDJT)
This program provides training funds for businesses that promote new job opportunities, advanced training for existing employees, skilled training for new workers, and strengthen the state's economic base. Funds are released through a competitive application process. Once the company has defined its training needs, SFI will pursue training funds through the appropriate eligible entity. Eligible course categories include: applied academics, equipment specific, process improvement (ISO/QS 9000) and technical training. The recent average training grant has been $900 per trainee. In a typical project, a provider such as Delta College Office of Corporate Services will meet with a Company to discuss their employment plans and training needs. Delta will help develop a training plan that includes cost estimates. These costs may be covered by the EDJT program, the Governor's Scholarship Fund, On-The-Job (OJT) funding or Job Training Partnership Act (JTPA) funds. Youth Registered Apprentice Tax CreditA tax credit of up to $2,000 annually per apprentice is available to employers who, through registered apprenticeships, train young people under age 20 who are enrolled in high school or a GED test preparation program. Students are employed part-time with structured on-the-job training combined with classroom work. Wages are paid on a graduated scale leading to journeyman status. Continued employment with the firm is expected. An employer, employer association, or the employer and the union, if applicable, are eligible to apply. A formal agreement is made between the business or industry, the educational facility, and the U.S. Department of Labor's Bureau of Apprenticeship and Training.
Incentives through Local LendersSBA 504 - Small Business Administration 504A Small Business Administration loan program providing long-term fixed rate financing for the acquisition or construction of fixed assets. Projects are financed through a unique public/private partnership that involves private lenders financing 50% of project costs, MCDC (Michigan Certified Development Corporation) covering up to 40% of project costs, and small businesses investing at least 10% of project costs. The SBA 504 Loan Program offers two loan terms, ten and twenty years, carry a fixed rate equal to a five-year treasury bond plus 1.75%, and a twenty-year loan carries an interest rate equal to a ten-year treasury bond plus 2.1%. The SBA 504 Loan Program is primarily designed to assist healthy, expanding businesses that have been in operation for two years or more. SBA 7(a) - Small Business Administration 7(a) Guaranteed LoanThe SBA 7(a) assists small businesses in obtaining a loan guarantee to enhance conventional financing. When conventional sources have been exhausted, small profit-making businesses that operate in retail, construction, wholesale, manufacturing and other services may apply for SBA 7(a) assistance. Businesses apply for SBA 7(a) guarantee through a bank that submits the application to the SBA's Michigan office. The SBA 7(a) provides working capital for the acquisition of inventory, financing receivables, and diminishing debts. Along with working capital, the SBA 7(a) covers fixed assets.
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