Burlington Renewal Community Fact Sheet What is the Renewal Community? The Renewal Community includes the Old North End and Downtown areas of Burlington. The boundaries are Willard Street on the east, the Intervale railroad spur on the north, Lake Champlain on the west, and King and Main Streets on the south.  If you want to see if you are located in the Renewal Community, you can view a larger map, check the street address list. There are over 11,000 people (around 5,300 households) who live in the Renewal Community. Around 30% of the City's total labor force - or roughly 7,000 workers - live in this area. There are at least 500 businesses in the Renewal Community - including over 300 retail businesses and around 30 manufacturers.   What does Renewal Community designation mean for the community? Renewal Community designation offers a number of new federal tax incentives, including: Wage Credit: Businesses can take a credit against Federal taxes of up to $1,500 each year for 8 years for every existing employee and new hire who lives and works in the Renewal Community   Increased Section 179 Deduction: Businesses that qualify as Renewal Community Businesses can claim up to $35,000 in additional expensing for certain depreciable property (such as qualified equipment and machinery) purchased after 1/1/2002   Commercial Revitalization Deduction: Provides an accelerated deduction period for commercial real estate for qualified projects in the Renewal Community involving new construction or substantial rehabilitation.  You must apply to the City in order to use this deduction.  You can view the CRD Allocation Plan, HUD's WorkPad and questionnaire for the Commercial Revitalization Deduction, a list of some questions and answers, or a description of 2003 CRD allocation projects to learn more.   Zero Percent Capital Gains Rate: Owners of qualifying Renewal Community assets do not have to pay federal tax on any gain when they sell the assets If 850 Renewal Community workers are each worth an extra $1,500 a year to local businesses, then over the course of 8 years those businesses will have over $10 million to invest in higher wages/better benefits, workforce training, expansion and new jobs, new equipment and technologies, and other strategies. How did Burlington get this Renewal Community designation? There was a national competition.  The City - through the Community & Economic Development Office - applied to the U.S. Department of Housing & Urban Development (HUD). The State supported that application. Burlington is one of twelve "rural" communities nationwide to have successfully competed for the designation.  There were also twenty-eight "urban" communities designated.  HUD's website has a complete list of all the Renewal Communities. How can I find out more about Renewal Community benefits? You can access the Tax Incentive Guide for Businesses in the Renewal Communities online at HUD’s web site. You can access IRS Publication 954 (Guide to Tax Incentives for Empowerment Zones and Other Distressed Communities) online at the Internal Revenue Service website.  You can also e-mail tax questions to the Internal Revenue Service or contact HUD with questions regarding tax incentives. The U.S. Department of Housing and Urban Development (HUD) has developed a checklist for determining Renewal Community eligibility which is available as a printable PDF.  In addition, HUD has developed an easy WorkPad and questionnaire for the Wage Credit, Work Opportunity Tax Credit, Commercial Revitalization Deduction, and the Increased Section 179 Deduction.  For the printable version of these files, you will need Adobe Acrobat Reader.  If you do not have a current copy of this free software, you can download it now.  Answers to the questionnaire can be emailed to the CEDO office at contactcedo@cedoburlington.org to help us determine the usefulness of the various tax credits. The Community & Economic Development Office (working with John Davis and Catherine Kronk), the U.S. Department of Housing & Urban Development, and the Internal Revenue Service are gathering questions about how the Renewal Community tax incentives will work.  You can see a list of some of the questions gathered so far, with the answers received so far.   You can also contact Bruce Seifer at 802·865·7179 or bseifer@ci.burlington.vt.us or contact your tax advisor. How does this new designation support the City's overall economic development policy? The City's overall economic development priorities include (among other things) the ongoing revitalization of the waterfront, development of the new Innovation Center of Vermont, increased housing density downtown and improvements to the Church Street Marketplace. In addition: Maintaining downtown vitality has long been a goal for both the City and the State.  Renewal Community tax incentives, which support downtown businesses, will supplement other initiatives like the Vermont Designated Downtown program, which has brought state income tax credits, sales tax reallocation and other incentives for downtown revitalization (Projects: Hall Block Building on the corner of College Street and S. Winooski Avenue, parking for Filenes, and the new street lighting on S. Winooski Avenue).   Supporting small business development is a cornerstone of the City's economic development policy. The new tax incentives will supplement other assistance available through the Community & Economic Development Office and Renewal Community partners such as: o  Technical assistance and workforce training (Partners: Lake Champlain Regional Chamber of Commerce, the Women's Small Business Program, Old North End Community Technology Center/CyberSkills Vermont, ReCycle North, Vermont Businesses for Social Responsibility, Vermont Energy Investment Corporation, and YouthBuild Burlington); o  Financial assistance (Partners: Vermont Development Credit Union and the Vermont Community Loan Fund); and o  Help in finding a location through CEDO's Available Commercial Space Database. Redeveloping Brownfields and other underutilized commercial/industrial properties has been underway in the City since the mid-1990's, with help from the City's Brownfields program and the State's Redevelopment of Contaminated Properties program. Completed projects include the Architectural Salvage Warehouse at 53 Main Street and the former Vermont Transit Bus Barns site on North Winooski Avenue.  Renewal Community tax incentives will augment these efforts. Efforts to revitalize North Street, the "Main Street" of the Old North End, have been underway since 1996, when over 800 residents and business owners spent 18 months developing an implementation plan adopted by City Council in 1998. o There are currently over 25 businesses in the North Street Commercial District, on or within a block of North Street. Many of those businesses have worked with the Community & Economic Development Office over the last two years to create a direct marketing campaign. o Recent zoning changes have reduced the local regulatory process required for small neighborhood-oriented types of businesses on North Street by increasing the number of permitted uses. o The City successfully nominated the North Street Neighborhood Commercial District to the National Register of Historic Places; income-producing historic properties listed in the National Register are eligible for a federal tax credit of 20% of qualified rehabilitation costs. You can see an example of how several of these different programs might work together to help rehabilitate an older downtown building. What will I do with the money I save? Yes, you could head south next February - but first, a few questions: Does your company compete with others for employees?  Is productivity a factor in your company's success?  Does your company experience too much employee turnover?  Does your company suffer from worker shortages?  These questions come from the Livable Jobs Toolkit prepared by Vermont Businesses for Social Responsibility.  If you're interested in investing some of your tax savings in higher worker satisfaction, here are some suggestions.  With $1500, you could:  Pay for free parking for a year for 5 employees using the PARC shuttle.  The cost per employee is $300. Pay a third party provider to administer Flexible Spending Accounts or a Dependant Care Assistance Program, which allow employees to use pretax dollars to pay for things like out-of-pocket medical expenses and child care.  Or, you could join Vermont Businesses for Social Responsibility and it will provide you with all the required paperwork for $50 a year.  (Either of these programs may pay for themselves just through savings on FICA/FUTA.) Work with the Fletcher Allen Wellness Program (802·847·2278) to improve employee health and reduce absenteeism.  Examples include: Offering flu clinics onsite for $15 a person Offering a one-hour smoking cessation lecture for $150 to $200, with 4 to 6 follow-up sessions at $10 a person Offer a one-hour class on self-care (recognizing and treating illness at home versus going to the emergency room) or nutrition, fitness and stress for $150 to $200 Offer screening for high blood pressure and cholesterol levels at $125 to $250 an hour Offer a CPR/first aid class for $20 to $30 a person Having a doctor or nurse onsite to work with employees on preventative care Combine sick, holiday, personal and vacation time into a single leave package and - assuming a $7.50 an hour employee - provide an extra day of leave. For more information and suggestions, check out the Livable Jobs Toolkit or contact Bruce Seifer at 802·865·7179 or bseifer@ci.burlington.vt.us. Up