The Downtown Alliance actively assists businesses locating in downtown's eight neighborhoods. This collaboration of public agencies and downtown businesses can help with site selection, incentives, permit assistance, financing and other aspects of relocating or establishing a business. Following are details on local programs, along with an overview of incentives offered by the State of California.

Local Programs

Renewal Community (RC) Program

The 2000 Community Renewal Tax Relief Act established San Diego as a "Renewal Community." Downtown businesses located in the East Village and Little Italy are eligible for Federal Income tax savings through the end of 2009. Savings are derived through the following:

Wage Credits up to 15%
Up to $35,000 in Increased Expensing
Zero Percent Capital Gain Rate for RC Assets
Commercial Revitalization Deduction

Business Cooperation Program (BCP)

Designed to lower operating and facility costs for companies doing business in San Diego, these financial incentives are based on the amount of tax revenue allocated to the City of San Diego by participating firms:

Cash rebate equal to .25/dollar (25 basis point on the total sale or purchase price)
Business tax/development fee credit equal to .45/dollar (45 basis points on the total sale or purchase price)

Business and Industry Incentive Program

Created in 1993 to improve the business climate of the city, this program offers:

Assistance with due diligence and acquiring necessary permits for land development or building modifications
40% reduction in water and sewer capacity fees

State Programs

Business Financing

Provided directly to qualifying companies in order to undertake specific projects, these programs include the following which may apply to companies considering locating in Downtown San Diego:

Tax-exempt Industrial Development Bonds
Small Business Loan Guarantee
SBA 504 Loans
California Capital Access Program
Sudden and Severe Economic Dislocation Loan Program
California Technology Investment Partnership Program
California Export Finance Loan Guarantees
Public Infrastructure Financing

Targeted Tax Incentives

California has made a concerted effort to encourage new investment through the creation of several targeted tax incentives. Businesses located in Downtown San Diego could qualify for the following:

Manufacturers' Investment Credit (up to 6%)
Research and Development Tax Credit
Net Operating Loss Carryover
Child Care Tax Credit

Enterprise Zone

One of San Diego's two Federal Enterprise Zones - the Metropolitan Enterprise Zone - is located in the southeastern quadrant of Downtown. California income tax and other benefits include:

Tax credits up to half the wages of qualified employees
Tax credits for sales taxes on manufacturing/production equipment
Net loss carryover
Accelerated business equipment depreciation
Personal income tax credits for low-income employees
Priority for Industrial Bond applicants
Lenders may deduct net interest on loans to Enterprise Zone businesses

Additional City of San Diego benefits include:

Free job recruitment and screening
Expedited permit applications
Certain development fees reduced or waived
Exemption from urban impact fees and housing trust fund fees

Employee Training

California offers a full spectrum of services to recruit, screen and train quality workers either off-site or at a company's facility:

Job Referral and Placement
Job Match (computerized database matching employers' job openings with qualified candidates)
Working with Business
Employment Training Panel

For details on major incentive programs offered by the State of California, go to http://www.commerce.ca.gov

For more information, contact the City's Economic Development Division.