Demand for the state's first round of business tax credits under the new California Competes program far exceeds supply, with applications totaling $559 million for only $30 million in credits available this year.
Gov. Jerry Brown's Office of Business Development this week notified 396 applicants who had applied between March 19 and an April 14 deadline.
"The demand for these tax credits demonstrates that there are a significant number of companies looking at expansion opportunities in California," Will Koch, the deputy director for California Competes, said in a statement Thursday. "We encourage any company looking to expand their existing business in the state, or interested in relocating to California, to apply when we open the application period again next fiscal year."
The income and franchise tax credits are available for businesses interested in relocating to California, as well as existing California businesses seeking "retention" credits meant to keep jobs in California. The credits are part of the package created by the Legislature and the Brown administration after lawmakers eliminated enterprise zones last summer.
There are 149 applicants that qualified for the second round of the California Competes selection process, representing about $155 million in requested credits.
Go Biz said 10 percent of the applications seek retention credits. That is much less than the figure – 60 percent – reported by the EZ Policy Blog, which follows the program.
The California Competes Tax Credit Committee will consider companies' requests for tax credits on June 19. Officials will consider the types of jobs created, potential future growth and other criteria.
Editor's note: This post was updated at 5 p.m. May 29 to include Go Biz's percentage of applications seeking retention tax credits.
PHOTO: California Gov. Jerry Brown visits Takeda, a biotech firm, in San Diego, where he signed signed legislation phasing out enterprise zones and replacing the program with California Competes and other incentives. U-T San Diego/Carolyne Corelis