New Tools for Business Growth.

New Tools for Business Growth.

The Hoosier state has been doing a lot this year to find new ways to drive business growth. Several new tools have been created and launched at the state and regional levels that indicate a willingness to be innovative when it comes to economic development and job creation. Also, a few of our existing tools have been upgraded to give Indiana an extra edge for investment attraction.

We’ve gathered a rundown of all the latest things officials are using to support the business community’s success. Together, they add up to one very handy toolkit.

 

Location, Location, Location

A big push in talent attraction efforts over the last few years has led to an increase in local and regional development initiatives. This year saw a few adjustments to some of those programs with the intent of increasing their use.

Specifically, the new Redevelopment Tax Credit was created as an expansion to the current Industrial Recovery Tax Credit program, which provides an incentive to invest in former industrial sites and improve quality of place in Indiana communities. The new version of the credit changes some of the building specifications, such as the requirement that it be an “industrial site” and that it be at least 100,000 square feet, to make the tool available in more communities and to more investors.

 

Our First Talent Region

Northeast Indiana was officially designated as the state’s first 21st Century Talent Region by Governor Holcomb, which encourages all regional stakeholders to create and implement a plan to increase educational attainment, raise household income, and grow the population in a region. A partnership between the Office of Career Connections and Talent, the Indiana Economic Development Corp. (IEDC), and CivicLab will bring together local governments, businesses, educational institutions, nonprofits, and economic and workforce partners for the initiative. Essentially, they’ll all be working together to identify strategic priorities and quality of place projects.

The initial steps that partners will be taking include:

  • The development of collaborative relationships and dashboards within the 11-county region by summer of next year
  • Implementing or adjusting initiatives to meet the goals of:
    • Growing the population to 1 million people,
    • Increasing postsecondary education and credential attainment to more than 60 percent,
    • And raising per capita personal income to 90 percent against the national average by 2030.

Just a few weeks after Northeast Indiana’s designation, the state named the EcO Network of Southeast Indiana as the second 21st Century talent region. The EcO Network will be working to cultivate collaborative partnerships necessary for regional development and growth.

 

Updates to Keep Us Competitive

Two key updates were made to Indiana’s business tax codes to enable the state to modernize its regulations and stay competitive.

In the first, legislators have made updates to the way service professionals are taxed on their income. The new rules will apply market-based sourcing for taxing income from the sales of services, taxing service companies only for income they earn from services sold in Indiana.

This will reportedly level the playing field for Indiana-based service companies and put our state more in line with more than 19 other states that have adopted this approach over the last decade, half of which use this type of market-based sourcing.

Secondly, updates were made to the Hoosier Business Investment (HBI) Tax Credit, which provides a conditional incentive to a company making a sizeable capital investment in order to locate or grow in Indiana. The HBI’s investment qualifications were expanded to capture modernized equipment used in today’s manufacturing and logistics sectors.

 

New Ways to Target High-Growth Companies

The state took several measures to broaden support and incentive offerings for startup companies and other high-growth firms, including:

  • Supporting R&D – A new Innovation Voucher program will provide grants to small businesses that partner with qualified organizations for activities like research, technology development, or commercialization. This tool will give participating businesses access to resources that otherwise would not be available, while fostering public-private partnerships to propel research and development (R&D).
  • Incentivizing Investors – The Venture Capital Investment (VCI) tax credit program was updated this year. It’s designed to help entrepreneurs and startups attract capital more quickly by giving investors an additional incentive to invest in growing firms. Now, the tax credits will be transferable starting in 2020, increasing the pool of potential investors.
  • Encouraging a Move – The Headquarters Relocation Tax Credit was expanded to better incentivize the relocation of small, high-growth companies to Indiana.

 

Showcasing Their Strengths

Earlier this year, the IEDC began coordination of a new grant program to enable regional economic development officials to take their message further and showcase their unique industries and advantages. Now, matching funds of up to $100,000 will be awarded to each of the state’s nine major economic regions to support domestic business development trips and site selector visits. The goal is to increase the frequency of Indiana’s pro-business message and success stories.

 

And That’s Not All

In addition to all of the new tools in the hands of economic development officials, the state created a new incentive for data center investment and several partnerships have launched targeted initiatives of their own. There is truly a great deal of activity happening in Hoosier economic development this year and it’ll be great to see the impact of these new concepts over time.