Maxis Advisors is committed to assisting current and future clients navigating how the current economic and social conditions will impact their existing state and local incentives agreements and compliance/performance requirements. Shortly after COVID-19 struck the United States, our team had discussions with numerous states to gauge how the states are reacting to the economic impact COVID-19 may have on its corporate citizens and business incentives. Our goal was to uncover any new incentives funds for job creation, capital investment, business retention, shifts of operations to produce Personal Protection Equipment, on-shoring efforts, etc. Additionally, we have been tracking how states are handling incentives related compliance requirements during a time where many companies have been forced to postpone job creation and capital investment plans, issue layoffs and/or furlough employees.
During such an uncertain time we have discovered that many state leaders are still trying to determine what the ultimate impact of COVID-19 will be and how to appropriately plan and respond. Many states will refer you to the CARE Act and PPP programs and express that leadership is still determining the best way to respond on a state level to the current crisis. Other states have responded proactively by issuing compliance-related alerts that provide direction on how companies should handle layoffs and furloughed employees for upcoming compliance filings, or even granting companies a “grace performance year” for current incentives agreements.
Maxis Advisors is committed to sharing state and local updates as we receive or identify them on our website and social media platforms. We invite you to contact Maxis Advisors for assistance if you are currently under an incentives agreement and have concerns about how to complete upcoming compliance filings, or if you would like to determine if changes have been made to your incentives programs requirements. Our team of professional incentives and compliance specialists are eager to help protect and maximize your incentives opportunities.
Examples of recent Incentives Alerts include:
The South Carolina Coordinating Council for Economic Development has made the following changes for the South Carolina Job Development Credit and State Grant program requirements:
- Remote Employees: Historically, remote employees may not be counted for purposes of calculating base employment or the minimum requirements for state grants or JDCs. For safety reasons and to prevent the spread of the virus, many businesses have required some or all of their employees to work remotely during the times of this national emergency. The Coordinating Council wants to assure companies that employees who are usually physically located at the business site and who are only working remotely for a temporary period due to the ongoing pandemic may still be counted toward base employment or the minimum job requirement for any existing state grant or JDCs.
- Furloughed Employees: As a result of temporary business shutdowns, many companies have put some employees on furlough status. Provided that furloughed employees still receive health benefits from the company, they may be counted toward base employment or the minimum job requirement of any existing state grant or JDCs. Please note, however, that a company will not be able to claim JDCs on any furloughed employees during the time of the furlough because they will not be paying wages to such employees during that time.
To address economic burdens on Job Development Investment Grant (JDIG) Grantees, the Economic Investment Committee provided the Secretary of Commerce the ability to provide the following COVID-19 Compliance Relief to the JDIG Grantees for calendar year 2020.
- Upon request by a JDIG Grantee, the Secretary may approve that the terms and conditions of the 2020 grant year, and any associated grant payments and obligations of the State and Grantee, be carried forward one calendar year. The grant compliance requirements for grant year 2020 would be shifted forward one year to 2021 and so forth until the end of the grant term. Grantees receiving such relief shall not be considered in default for the 2020 grant year with respect to their Job Creation, Retention, Investment and Wage obligations under their respective Community Economic Development Agreement (CEDA).
- For JDIG Grantees carrying forward their obligations, 2020 would no longer be considered a grant year and the 2020 grant year would not be counted in determining the maximum duration of the grant term or the timing of first payment under G.S. §143B437.56(b).
Since March 15, JobsOhio has made available more than $250 million to fund 10 new economic development programs.
- JobsOhio has created the JobsOhio Innovation Fund – a new program to provide Ohio’s entrepreneurial businesses with resources to soften the near-term impact of COVID-19 at this critical time. JobsOhio will allocate up to $50 million total toward this fund, and partner with Ohio’s current network of venture investors to provide loans into highest priority innovative investor-backed companies during this time.
- In order to continue to be a value-add partner, JobsOhio has enhanced our incentive programs for existing JobsOhio client companies to allow for maximum flexibility and support during this unprecedented time. These adjustments will help address unexpected pandemic-related business costs, improve access to funds and an immediate limited waiver of compliance.
- Considering the significant impact COVID-19 has on the economy and business, and to support its borrowers, JobsOhio will be offering a 6-month deferral of payment of loans (no principal and no interest) for the nearly 50 companies that have executed loan agreements with JobsOhio.