Lynchburg: A thriving city for businesses
There’s a reason why Lynchburg is among Forbes’ Top 100 Best Small Places for Business and Careers. From low unemployment rates, even lower cost of living and a competitive average cost of doing business, Lynchburg offers many local initiatives that businesses need to prosper. When your business is ready to invest in Lynchburg and our workforce, we are ready to support you through targeted investments that provide immediate returns and long-term benefits for Lynchburg citizens. Below is a sample of incentives and credits available to eligible firms relocating to or expanding in Lynchburg.
All programs administered by the Office of Economic Development & Tourism and Economic Development Authority are subject to modification, the availability of funds and review and approval by the Authority and staff. Please review the most currently available information and contact our office for clarification prior to beginning your project.
The City of Lynchburg boasts two Enterprise Zones providing investment incentives covering 4,200 acres of commercial property. In our Enterprise Zones, state and local incentives combine to support existing business expansion and new business relocation. Incentives include cash grants for real estate investments and job creation, along with local benefits for qualifying investments.
Real Property Investment Grant
- Qualified real property investments in a commercial, industrial or mixed-use building or facility within the boundaries of a designated Virginia Enterprise Zone (requires at least 30% commercial space)
- 20% cash grant for real property rehabilitation investments above a $100,000 threshold
- 20% cash grant for new construction investments above a $500,000 threshold
- Grant capped at $100,000 for investments less than $5 million
- Grant capped at $200,000 for investments of $5 million or more
Job Creation Grants
- Cash grant up to $800 per job per year for five years
- Requires creation of five jobs or more
- Requires wages equal to or above 175% of the Federal minimum wage with benefits
- Personal service, retail, food and beverage positions are not eligible
- Grant will be based on the wages paid for those grant eligible positions
Incentive value in the form of cash, infrastructure improvements or other support as determined by the EDA may be given for eligible capital investments. All taxes generated by capital investment (business personal property, machinery & tools, real estate improvement, etc.) must generate a positive return on investment over a 36-month period, which is subject to verification and the terms of a performance agreement. This program includes a maximum incentive equivalent to 2% of the capital investment up to $10 million or 1% of capital investment over $10 million, with a cap of $350,000.
The Job Creation Grant offers incentive value in the form of cash, infrastructure improvements or other support as determined by the EDA to support large-scale employment expansion. Grant value may be up to the value of a 2% increase in annual payroll of FTE positions with health benefits if base employment is increased by more than one-third or thirty net-new positions, whichever is greater. This grant opportunity requires an annual payroll audit and a performance agreement.
This tax credit opportunity effects Residential, Multi-Family, and Commercial and Industrial spaces. Effective in January 2018, residential rehabilitation projects will be offered up to 10 years of real estate tax exemption on the improved value of the home. Multi-Family properties, those representing five or more units, will receive eight years of tax exemption. Commercial and Industrial properties will be given up to ten years of tax exemption on the improved value of rehabilitation and renovation. This effort has the potential for job creation for commercial and industrial uses.
For more details, contact the City Assessor at (434) 455-3830 or visit http://www.lynchburgva.gov/real-estate-rehabilitation-and-renovation-program.
Arts & Cultural businesses located within the city’s James River Arts & Cultural District are eligible for reimbursement of certain business license taxes, along with regulatory flexibility as applicable and approved. Contact our office at (434) 485-7291 for more information about placing your business in the Arts District.
The Office of Economic Development and Tourism also manages the Arts District grant fund for nonprofit organizations, businesses and individuals wishing to participate or complete arts-related projects in the District. Click below for additional information and resources.
The City of Lynchburg Economic Development Authority created a Revolving Loan Fund in 2011 to provide additional support for private sector investment in the City. The loans funded through this program have provided gap financing to help a diverse array of local businesses both start and expand their business within the City of Lynchburg.
This program is not currently accepting new applications. Contact Jason Witt in the Office of Economic Development and Tourism at (434) 455-4490 for more information.
The Lynchburg Economic Development Authority owns and manages two industrial parks. For major qualifying investments, the EDA may offer sale or lease of property at attractive rates, build-to-lease or build-to-own arrangements, site preparation infrastructure improvements and/or other development assistance.
The entire City of Lynchburg is a certified Technology Zone. Qualified tech-based businesses are eligible for local tax incentives for net new capital investment and job creation. Any qualified technology business that locates in or is already located in the technology zone shall be entitled to a five-year reimbursement of business license taxes as follows: during the first calendar year, a 75 percent reimbursement; for the second calendar year a 50 percent reimbursement; and for the third, fourth and fifth calendar years a 25 percent reimbursement.
- Requires a minimum $100,000 net new capital investment
- Within a 12-month period, hire five net new full-time employees
- Wages equal to or greater than 200% of the federal minimum wage
For more information, contact Marjette Upshur, Director of Economic Development & Tourism at (434) 455-4490 or email@example.com.
The Economic Development Authority of the City of Lynchburg is a political subdivision of the Commonwealth of Virginia organized and operating under the Virginia Industrial Development and Revenue Bond Act, Chapter 49, Title 15.2, Code of Virginia, 1950.
Companies seeking to finance new manufacturing facilities or improvements to existing facilities can obtain long-term financing at favorable interest rates through the use of industrial revenue bonds (IRBs). An IRB is issued by a local industrial or economic development authority to finance the acquisition, construction and/or equipping of a facility or may be used to refinance existing IRBs. Tax-exempt financing may also be available for facilities for nonprofit organizations like hospitals and schools.
Fees of the Economic Development Authority of the City of Lynchburg include non-refundable application fee, cost of advertisement for public hearing, Authority counsel fees and annually, when billed, an annual administrative fee of 1/10th of 1% of the outstanding principal amount of the Bond on each anniversary date of the closing date
Bond issuance requires approval at public hearing by both the Economic Development Authority of the City of Lynchburg and the Lynchburg City Council. For more information, contact Marjette Upshur, Director of Economic Development & Tourism at (434) 455-4490 or firstname.lastname@example.org.
The Federal Tax Cuts and Jobs Act of 2017 included provisions for a new revitalization tool, the Opportunity Zone and Opportunity Fund. The program will allow investors to receive tax benefits on currently unrealized capital gains by investing those gains in qualified census tracts, or Opportunity Zones. There are four federally-designated zones in the City of Lynchburg.
The rules associated with qualification of Opportunity Investment Funds and Qualified Opportunity Investments must be written at the federal level and are expected to be formalized later this calendar year.
For more information on Opportunity Zones in the Commonwealth of Virginia, including an interactive map of designated zones, please visit the Department of Housing and Community Development at http://dhcd.virginia.gov/index.php/opp-zones. You can view Lynchburg’s Zones at https://mapviewer.lynchburgva.gov/ParcelViewer/ and highlighting “Opportunity Zones” on the left sidebar.
The City of Lynchburg hosted Virginia Community Capital for a presentation on Opportunity Zones on October 31, 2018. Download the slides: VCC Opportunity Zones Lynchburg.
If you are interested in investment in projects or businesses in the City of Lynchburg, please contact Marjette Upshur at email@example.com or (434) 455-4490.
In September 2015, the Lynchburg City Council established the entire city as a Tourism Zone in order to promote the continued development and success of tourism-based businesses. Tourism projects in the city may be eligible for the Commonwealth of Virginia’s Tourism Development Financing Program, a gap financing program managed by the Virginia Tourism Corporation and the Virginia Resources Authority. Contact Anna Bentson at firstname.lastname@example.org for more information.
Designed to support small- and medium-scale investments in commercial property within the city’s Enterprise Zones, the Local Redevelopment Program supports a portion of qualified expenditures. Property requires at least 20% commercial use. Proper permitting is required to qualify, and submitted project costs are verified by building permit. Applications must be completed within 30 days of beginning work.
This program is not currently accepting new applications. For more information and application forms, please contact the Office of Economic Development at 434-455-4490 or email Jason.Witt@lynchburgva.gov.