Kelly Sloan, The Business Times
Economically distressed areas of Colorado will soon see tax-friendly zones established to help attract entrepreneurs and new businesses.
Newly enacted state legislation creates zones in which qualifying businesses will be exempt from taxes and fees.
The much-anticipated Tax-Free Colorado bill was introduced in the waning days of the 2015 legislative session and passed in the State House by a 50-13 margin on the final day of the session. The bill underwent several iterations on its way to becoming law, including the name — the “Tax Free Colorado” draft was introduced as the “Tax Friendly Colorado” bill, owing to a revision that kept property tax from being exempted due to concerns over constitutional school funding issues. The final bill was re-christened the “Jumpstart Rural Colorado” bill.
Among the other changes to the measure:
The length of the program was reduced from 10 years to four years, with an option to renew for an additional four years for a total of eight years.
Local governments within the distressed counties have flexibility as to which local taxes may be exempted or credited.
Distressed areas qualifying for the program are limited to counties with a population of less than 250,000.
The requirement qualifying businesses create net new jobs was replaced by net new hires to open the jobs to existing residents.
The number of jobs created under the program has been capped at 200 per zone.