Craig seeks enterprize zone status
Englewood City Council gave consensus approval for city endorsement to Craig Hospital’s application to be designated as an enterprise zone contribution project.
“Craig Hospital is in the Arapahoe County Enterprise Zone but the hospital is a non-profit organization so is not eligible for the zone’s tax credits,” Darren Hollingsworth, economic development director told the council at the May 6 study session. “However, the hospital is applying to the state economic development commission for designation as a contribution project that would provide state tax credits to donors to the building fund.”
The hospital embarked capital campaign to raise the money for the $85 million renovation and expansion program now underway. If Craig were a for-profit hospital, the organization would receive up to 25% tax credit on a number of costs related to the project.
For example, Hollingsworth told the council Swedish Medical Center is a for-profit hospital that takes tax credits under a number of categories including equipment purchase and job creation that results in the hospital receiving about $250,000 a year in state tax credits. At the same time, the non-profit House of Hope Family Resource Center has been granted status as a contribution project which means donors are eligible to receive state tax credits.
Council Member Rick Gillit asked if there was a definition of the type of donor eligible for the tax credit.
“When a donor applies for the tax credit, the state decides whether or not that individual or company qualifies to receive the credit,” Hollingsworth said.
The state created enterprise zones in 1990 to provide economic development benefits to businesses locating in the area or to existing businesses expanding operations.
Right after the zone was created, the cities of Englewood, Littleton and Sheridan applied for and were granted enterprise zone designation for a majority of the industrially and commercial properties within their boundaries. In 2001 there was a successful request to expand the enterprise zone boundaries to include additional properties in Englewood and Littleton and an additional boundary expansion in 2010.
The enterprise zone incentives include state tax credits for a variety of reasons, including purchase of machinery and equipment, providing company-sponsored health insurance, for money spent on job and school-to-career training and related programs and there is a sizable tax credit for rehabilitating a building at least 20 years old that has been vacant for at least two years.
Hollingsworth said the 2012 Arapahoe County Enterprise Zone activity report showed 136 firms invested about $124 million in their businesses and received a total of about $2.5 million tax credits.