The City of Chandler benefits from significant incentive programs on the state and local levels. These programs provide Chandler businesses with significant reductions in sales, income, and property tax liabilities. Chandler’s Economic Development team is dedicated to finding the best site and any incentives for which your expansion or relocation project may qualify.
Arizona’s Policymakers Have Consistently Lowered Taxes
Competitive Economic Development Programs
- Corporate income tax rate (currently at 5.5%) will fall to 4.9% by 2017
- Sales factor for export-oriented business currently at 95% will increase to 100% by 2017
- Arizona’s unique additional depreciation schedule allows companies to aggressively accelerate the depreciation of personal property value over 5 years
Angel Investment Program
- Angel Investment Tax Credits
- Foreign Trade Zones
- Job Training Grants
- Qualified Facilities Refundable Tax Credit Program
- Quality Jobs Tax Credit Program
- R&D Tax Credits
- Renewable Energy Tax Investment Program
The principal objective of the Angel Investment program is to expand early stage investments in targeted Arizona small businesses. The program accomplishes this goal by eliminating Arizona capital gains tax liabilities associated with the disposition of investments in small businesses certified by the Arizona Commerce Authority (ACA).
Foreign Trade Zone Program (FTZ)
Businesses located in a zone or sub-zone are eligible for reduction in state real and personal property taxes. To qualify for this program you must be a non-retail company located in a designated foreign trade zone. For business that are activated within a foreign trade zone sub zone, State law also provides for an 80% property tax reduction on both real and personal property.
Programs benefits include:
Job Training Grants
- Merchandise may be brought in duty-free for storage, repacking, display, assembly or manufacturing
- Imports may be landed and stored quickly without full customs formalities
- Real and personal property can be reclassified from Class 1 to Class 6 commercial property (from 18% down to a 5% assessment ratio)
The Arizona Job Training grant is a job-specific reimbursable grant that supports the design and delivery of customized training plans for employers creating new jobs or increasing the skill and wage levels of current employees.
Qualified Facilities Tax Credit
The goal of the Qualified Facilities Tax Credit program is to stimulate the creation or expansion of manufacturing facilities, including manufacturing-related research and development or headquarters facilities. The program goal is accomplished by providing a refundable Arizona income tax credit to qualified applicants. A qualifying facility may be eligible for tax credits once the qualified facility in Arizona devotes at least 80% of the property and payroll at the facility to one or more of the following:
Subject to eligibility requirements, the Qualified Facility tax credit offers a refundable income tax credit equal to the lesser of 10% of the qualifying capital investment or $20,000 per net new job at the facility or $30,000,000 per taxpayer per year.
- At least 51% of the jobs created must be greater than 125% of the state median wage which is currently at $42,788
- At least 80% of benefits package must be covered by employer
- A minimum investment of $250, 000 in each year of “pre-qualification"
The Quality Jobs tax credit
The Quality Jobs tax credit offers up to $9,000 of Arizona income or premium tax credits spread over a three-year period for each net new quality job ($3,000 per year). The program encourages continuous employment; therefore, the tax credit is equal to:
|Years of Employment
||Tax Credit Amount
||$3,000 per net new qualified employment position created during the taxable year or partial year of employment
||$3,000 per qualified employment position, employed for the second full taxable year of continuous employment
||$3,000 per qualified employment position, employed for the third full taxable year of continuous employment
If the allowable tax credit exceeds the income or premium tax liability, any unused amount may be carried forward for up to five consecutive taxable years.
The Quality Jobs tax credit is capped at 10,000 jobs being claimed each year by all participants. To view the amount of available cap, please download the Tax Credit Allocation Table.
Research and Development Tax Credit Program
The Research and Development (R&D) incentive provides an Arizona income tax credit for increased research and development activities conducted in this state, including research conducted at a state university and funded by the company.
Three types of R&D tax credits available:
- Regular R&D Credit (Nonrefundable)
- Refundable R&D Credit
- Additional R&D Credit for University Research (Nonrefundable)
Qualifying small companies (less than 150 FTE)
- 24% of first $2.5 million in qualifying expenses
- 15% of the qualifying expenses in excess of $2.5 million
R&D Credit for University Research
- Can apply to make their credit refundable (75% of nonrefundable credit value)
- Can receive up to $2M in refundable credits per year
Renewable Energy Tax Incentive Program
- 10% the amount of basic research payments above the base amount paid to one or more state universities
The Renewable Energy Tax Incentive Program (RETIP) goal is to encourage business investment that will produce high-quality employment opportunities and enhance the state of Arizona position as a center for production and use of renewable energy products. The program provides tax incentives to businesses in the solar, water, wind, geothermal, biomass, biogas, landfill gas and other non-fossil renewable energy industries expanding or locating in Arizona.
Program benefits include:
- A refundable corporate income tax credit up to 10% of capital investment
- 75% reduction in property taxes for up to 15 years
City of Chandler Programs
Adaptive Reuse Program
The purpose of the program is to encourage and facilitate the reuse of existing commercial buildings/properties that are underutilized or underperforming. This is accomplished through a special overlay district that relaxes site development standards that otherwise make the reuse of existing buildings, structures and sites economically unfeasible. These site development standards include, but are not limited to, lot coverage, building setbacks, parking requirements and mechanical equipment screening.
Business Location Team
The City of Chandler's Business Location Team (BLT) provides excellent customer service throughout the development process and works closely with companies to ensure that project reviews are done in a timely manner. The City Planning and Development Department is committed to working with businesses on planning, zoning, and permitting issues.
Chandler Industrial Development Authority (CIDA)
CIDA offers businesses the ability to finance new manufacturing projects with tax-exempt industrial revenue bonds (IRB's). Eligible projects include new, improved or expanded manufacturing facilities, and manufacturing equipment. The interest rates for these IRB's tend to be significantly lower than prime, and the interest on the bond is exempt from federal and state income tax.
Collateral Assistance Program
The Chandler Collateral Assistance Program (CCAP) was created by the Chandler Industrial Development Authority (CIDA) to assist Chandler businesses in obtaining loans and create jobs in Chandler. The Chandler Collateral Assistance Program provides additional collateral, of a maximum of $50,000 or 20 percent of the total loan proceeds, whichever is less, to eligible businesses. Job creation is an essential element of any request for Collateral Assistance.
Colonnade Signage Program
Colonnade Signage Program: To recapture the effectiveness of the colonnade signs, Chandler is encouraging downtown businesses to install signs on the front of the colonnade facing the street. The Colonnade Signage Program is designed to assist downtown business owners with installing signage by providing grants of up to $650 per business for the creation and installation of one sign, which would hang from the Colonnade facing the street. The money can be used for design fees, materials, and/or installation of the sign. The sign must conform to the Downtown Sign Code and receive a permit to be considered for the program.
For more information, contact Downtown Redevelopment Department at 480-782-3045.
Historically Underutilized Business Zones Program (HUBZone)
This program was enacted into law as part of the Small Business Reauthorization Act of 1997. The program encourages economic development in historically underutilized business zones - "HUBZones" - through the establishment of preferences.
To qualify for the HUBZone program, your business must be located in one of the City of Chandler area designated as a Historically Underutilized Business Zones Program (HUB) Zone.