RICHMOND - At a morning news conference at the State Capitol, Virginia Governor Bob McDonnell, joined by legislators from both sides of the aisle, introduced his "Jobs and Opportunity Agenda." The legislative package consists of 20 pieces of legislation, as well as previously announced budget amendments, all focused on spurring job creation, promoting economic development and creating more opportunities for Virginians. Lieutenant Governor Bill Bolling, Secretary of Commerce and Trade Jim Cheng, Senior Economic Advisor Bob Sledd, and almost 30 Delegates and Senators from both parties all participated in the morning event.
Among the highlights of McDonnell's agenda are measures to double the Governor's Opportunity Fund, create a state HUB Zone Program, lower the threshold for Virginia's Major Business Facility Job Tax Credit, provide tax credits for movie production, help veterans open small businesses, direct future royalties and revenue from offshore energy production to transportation and green energy development, and create the Virginia Universities Clean Energy Development and Economic Stimulus Foundation to encourage and facilitate energy research and economic development at Virginia's universities and in the Commonwealth's rural areas. A preliminary economic impact analysis prepared by the Virginia Economic Development Partnership estimates that just the budget initiatives component of McDonnell's "Jobs and Opportunity Agenda" alone will lead to over $311 million in new revenue for the Commonwealth over five years, and the creation of more than 29,000 new jobs over the biennium.
Speaking about the agenda, Governor McDonnell stressed the importance of job creation, stating, "This is a Jobs Administration-I have made creating jobs and bringing more opportunity to every region of Virginia my top priority. I am honored to be joined by Republicans and Democrats all committed to ensuring that practical solutions are put in place to obtain positive results for our citizens. Job creation is not a partisan issue, it is a Virginia issue. These bills will help in the effort to create the opportunity for good jobs for all Virginians."
Lieutenant Governor Bill Bolling, who serves in the McDonnell cabinet as Virginia's Chief Job Creation Officer, remarked, "As we have said for months creating new jobs and growing the economy are our top priorities. By investing in proven economic development programs with a high return on investment, our budget and legislative initiatives take significant steps towards reaching these goals. A preliminary estimate finds that the budget amendments that are part of this agenda will lead to the creation of 29,300 new jobs over the next two years and over $311 million in revenue for the state over the next 5 years. It has been my pleasure to work with the Governor and our economic team to develop these recommendations and I look forward to working with Republicans and Democrats in the General Assembly to secure their passage."
Delegate Danny Marshall (R-Danville) joined McDonnell at the event and noted, "My district has been hit hard by the staggering economy-Virginians are anxious for what the future holds and I am proud to be able to introduce legislation on behalf of Governor McDonnell to help workers and their families regain some economic stability."
Delegate Mark Keam (D-Fairfax) also attended the morning press conference and remarked, "In these tough economic times, the most important task for the General Assembly is to focus on job creation and turning the economy around. As a Democrat, I am proud to work with Gov. McDonnell to help grow the economy of the Commonwealth by attracting new jobs. Citizens in my district sent us to Richmond to work in a bipartisan manner, and that is exactly what Gov. McDonnell and I are doing."
Finally, Senator Robert Hurt (R-Chatham) commented, "It's an honor to stand with Governor McDonnell, and other leaders from the House and Senate, in support of this much needed job-creating legislation. We are all committed to creating an environment in which businesses can thrive and create jobs for Virginians."
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Governor McDonnell's 2010 Jobs and Opportunity Legislative Agenda
Job Creation
Governor's Development Opportunity Fund - Criteria for awarding grants and loans (Watkins and Edmunds)
Provides that criteria to be used in awarding grants and loans from the Governor's Development Opportunity Fund shall include (i) job creation, (ii) private capital investment, and (iii) anticipated additional state tax revenue expected to accrue to the state and affected localities as a result of the capital investment and jobs created.
SB475 and HB380
Governor's Development Opportunity Fund - Authority to award grants (Puckett and D. Marshall)
Governor's discretion for use of GOF funds – may include a requirement for local match which may be cash or in-kind; and may waive the cap for qualifying projects.
SB554 and HB1244
Enterprise Zone Grant Program (D. Marshall)
Changes the eligibility for enterprise zone job grants in areas with an unemployment rate that is one and one-half times or more than the state average to positions paying at least 150 percent of the federal minimum wage including health benefits.
Currently positions paying less than 175 percent of the federal minimum wage are not eligible for the job grants.
In addition, the bill provides that when the sum of grants for job creation and real property investment exceeds the total annual appropriation for payments, allocations shall be prioritized to fully fund the grants for job creation with any remaining funds to be allocated to the real property investment grants.
HB555
Historically Underutilized Business Zones (HUB Zones) (Ruff and Dance)
Support businesses in rural and economically distressed urban areas through the creation of a state HUB Zone Program - requiring that at least 15% of state procurement contracts be awarded to qualified small businesses.
SB658 and HB1228
Major Business Facility Job Tax Credit – Lowers threshold for qualifying jobs (Watkins and Kilgore)
Amends the Major Business Facility Job Tax Credit.
Current law provides a $1,000 tax credit for major business facilities that create at least 100 qualified full-time jobs. This legislation will lower the threshold to 50 full-time jobs.
In enterprise zones or economically distressed areas, the base or threshold is lowered from 50 newly created jobs to 25.
The changes also allow the credit to be taken over a two-year period for taxable years beginning January 1, 2009, through December 31, 2012, rather than December 31, 2010.
SB472 and HB624
Major Business Facility Job Tax Credit - Lowers threshold for qualifying projects in distressed areas (Hurt and Morefield)
Lowers from 50 to 25 the threshold number of employees of a major business facility in an enterprise zone or distressed area for the facility to qualify for tax credits for newly created jobs.
SB481 and HB853
Permit fees; veterans waiver (Hurt/Stosch and Sherwood/Greason)
Requires state regulatory agencies to waive administrative fees for issuing a permit when the application is submitted by a veteran in connection with his establishment and operation of a small business.
SB455 and HB262
Economic Development
Center for Rural Virginia Board of Trustees; membership (Watkins and Merricks)
Adds the Lieutenant Governor and the Secretary of Commerce and Trade or their designees to the membership of the Board of Trustees of the Center for Rural Virginia.
SB473 and HB604
Income taxes; recognition of income from capital gains (Herring and Nixon)
Grants an income tax exemption for any gain taxed as a capital gain for federal income tax purposes, on or after January 1, 2010, that is related to a qualified investment of a technology and science start-up business made in the first three years in which the business was founded.
SB428 and HB523
Motion picture film production tax credits (Lucas and Cline)
Provides income tax credits to any motion picture production company with qualifying expenses of at least $250,000 with respect to a film production in the Commonwealth, for taxable years beginning on or after January 1, 2010.
Total credits allowed for any biennium cannot exceed $5 million.
SB257 and HB861
Specialized Biotechnology Research Performance Grant Program (J. Howell and May)
Establishes the Specialized Biotechnology Research Performance Grant Program for nonprofit entities engaged in research, development, and production related to molecular diagnostics and drug development that enter into a performance-based memorandum of understanding with the Commonwealth prior to June 30, 2010.
Grants would be paid to an eligible entity based in Fairfax County that commits in the memorandum of understanding and fulfills its obligation to (i) make a new capital investment of at least $200 million, (ii) create at least 415 new full-time jobs, and (iii) meet any other criteria set forth in the memorandum of understanding.
Grants from the program to a qualified entity shall not exceed $22 million in the aggregate.
HB677 and SB644
Virginia Economic Development Partnership (Comstock)
Changes the title of the Executive Director of the Virginia Economic Development Partnership to the Chief Executive Officer.
HB1372
Public-Private Partnership Economic Development Fund (Stosch)
Authorizes state agencies and state authorities, upon the approval of the Governor, to enter into agreements with private entities under the Public-Private Transportation Act of 1995 and the Public-Private Education Facilities and Infrastructure Act of 2002 for the development of a project by the private entity, which agreements provide for the private entity to be paid grants from a portion of the growth in state taxes and fees attributable to the development of the project.
The bill also would allow local governments, agencies, and authorities, upon the approval of the governing body of the locality, to join in the agreement entered into between the private entity and the state agency or state authority.
SB181
Small Business Investment Company Credit (McWaters/Vogel and Merricks/Comstock)
Provides for the creation of private investment funds (up to $100 million) that will invest in small businesses located in Virginia.
Establish Major Employment and Investment Project Site Planning Grant Fund and Program (Reynolds and Armstrong)
Establish a mega-site fund of $5 million for FY 2011-2012.
This fund will support efforts to improve site location development to encourage large businesses to locate to the Commonwealth and create new jobs.
Alcoholic beverage control; wine liter tax (Watkins and Landes)
Requires the portion of the wine liter tax collected from the sale of wine produced by farm wineries to be deposited in the Virginia Wine Promotion Fund for use by the Wine Board.
SB237 and HB588
More Opportunities
*Recruitment*
Temporary Business License for Businesses in Good Standing (Watkins and LeMunyon)
Allows businesses operating in good standing in another state to receive a temporary business license to operate in Virginia.
SB474 and HB792
*Energy*
Virginia Universities Clean Energy Development and Economic Stimulus Foundation (Stuart and Bell)
Creates the Virginia Universities Clean Energy Development and Economic Stimulus Foundation as a body corporate and a political subdivision of the Commonwealth.
The Foundation shall identify, obtain, disburse, and administer funding for (i) research and development of alternative fuels, clean energy production, and related technologies; (ii) support of economic development projects in disadvantaged rural areas; and (iii) the provision of assistance in the commercialization of alternative fuels and clean energy technologies.
Funding shall be awarded only to those proposed projects that best meet the established criteria and purposes of this act.
SB326 and HB928
Royalties from offshore drilling (Wagner and Stolle)
Requires that 80 percent of any revenues and royalties paid to the Commonwealth as a result of offshore natural gas and oil drilling shall be deposited to the Transportation Trust Fund.
The remaining 20 percent will be invested in renewable energy research and development.
SB601 and HB756
Green Jobs Tax Credit (Hanger and Poindexter/Keam)
Allows a $500 income tax credit for the creation of "green" jobs for taxable years beginning on and after January 1, 2010.
Each taxpayer is allowed a credit for up to 350 new green jobs and may qualify for the Enterprise Zone Grant program if the job is located in an enterprise zone.
SB623 and HB803/HB1132
Job Creating Budget Amendments
Budget Bill – HB30/SB30 (Putney/Colgan/Wampler)
More than doubling the Governor's Opportunity Fund in FY 2011 by increasing the state commitment by $12.1 million
Committing $5 million in FY 2011 to a state industrial mega-site fund to attract new employers
Using $2 million over the biennium to establish state economic development offices in major growth markets in China, India and the United Kingdom
Supporting the fast growing bio-technology and life sciences industry by removing the $3 million cap on the Qualified Equity and Subordinated Debt Investment Tax Credit and raising it to $5 million in FY 2011; Investing $3 million in bioscience "Wet Lab" Facilities over the biennium; Utilizing $2 million to reestablish funding for the Business Incubator Program in FY 2011; Providing income tax exemption for qualified investments in technology and science startup companies in FY 2012 (cost $500,000)
Increasing state funding for the Virginia Tourism Corporation by $3.6 million in each year of the biennium, and state funding for the Governor's Motion Picture Opportunity Fund by $2 million in FY 2011
Depositing the Wine Liter Tax attributable to Virginia Wine into the Wine Promotion Fund ($1.5 million over biennium)
Improving Virginia's business assistance services by increasing funding for the Loan Guarantee Program by $1 million in FY 2011; Continuing funding for the Business One Stop Program, cost of $1 million over the biennium; Increase the appropriation for the Virginia Jobs Investment Program by $6.5 million in FY 2011