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New Castle County Finance Programs
Recovery Zone Facility Bonds
Recovery Zone (RZ) Facility Bonds are a new category of private activity "exempt facility bonds" offered by New Castle County. The American Recovery and Reinvestment Act (ARRA) of 2009 authorized states, counties and large municipalities to issue RZ Facility Bonds to finance qualified economic development purposes in certified recovery zones. New Castle County has been allocated $76,365,000 in RZ Facility Bonds that can be issued through December 31, 2010. RZ Facility Bonds are traditional tax-exempt bonds which have lower interest rates because the interest is tax-exempt to the investors for Federal tax purposes. The RZ Facility bonds can be used by private businesses for depreciable capital projects (e.g., buildings and equipment) for original use in active businesses in recovery zones. These bonds cannot be used for multi-family housing, pools, massage parlors, gambling establishments, or related uses.
Small Issue Industrial Development Bonds
The ARRA of 2009 makes significant temporary changes to rules concerning tax-exempt private activity bonds, affecting bonds that are issued in the remainder of 2009 and 2010. The ARRA expands the application tax-exempt qualified small issue bonds, commonly known as "Industrial Development Bonds" or "Small Issue IDBs." for use in financing manufacturing facilities used in the production of intangible property, including patents, copyrights, formulas, processes, designs, patterns, knowhow, formats and other similar items. Bonds may be issued to finance facilities for the creation of computer software, as well as R & D facilities for intellectual property associated with the biotech, pharmaceutical and other fields.
General Requirements for Small Issue IDBs:
| Ninety-five percent (95%) of the proceeds of the bonds must be used for: |
| o Acquisition |
| o Construction |
| o Reconstruction |
| o Improvement of land, or |
| o Rehabilitation of building if 15 percent of proceeds used for rehabilitation |
| o Limit on the amount of Small Issue IDB principal for single issues: $10,000,000 |
Business Development Corridor and Economic Support Program
The Delaware Economic Development Office provides funding to certain qualified businesses situated in New Castle County development corridors in the following forms: partial, low-cost loans to qualifying businesses; loan guarantees; purchase of credit enhancements; and by providing direct grants. Qualified businesses that are actively engaged in the same or similar commercial and retail activity for at least 20 consecutive years in the development corridor are eligible for these financing programs. New Castle County Development Corridors are available for review at www2.nccde.org/redevelopment/pages.
Tax Exemption for New or Renovated Commercial or Manufacturing Projects
(Applicable only to the city of Wilmington)
New or renovated commercial or manufacturing projects located within the corporate limits of the City of Wilmington are eligible to receive a partial tax exemption on the increase in the New Castle County portion of property tax attributable to the new construction. The cost of new construction and/or the cost of site acquisition and construction must exceed fifty thousand dollars ($50,000.00). The tax exemption is applicable to all new or renovated commercial or manufacturing projects first assessed on the property tax records after August 22, 1978. Residential structures are exempt.
 The Delaware Economic Development Office (DEDO) is to be responsible for attracting new investors and businesses to the State, promoting the expansion of existing industry, assisting small and minority-owned businesses, promoting and developing tourism and creating new and improved employment opportunities for all citizens of the State.
Household Income: Delaware's 2006 per capita personal income was $39,022. Per capita income in New Castle County was $41,937 in 2005. For more information on the Delaware labor market please go to the Delaware Department of Labor website and review the Delaware Annual Economic Report 2006
Workers Compensation: Workers' Compensation is a system which provides benefits to workers who are injured or who contract an occupational disease while working. The benefits include medical care, temporary disability payments and compensation for a resulting permanent impairment. In the event of the death of an injured worker, benefits are payable to the family of the worker.
In May 2007, Governor Ruth Ann Minner signed Senate Substitute 1 for Senate Bill 68 that amended workers' compensation insurance requirements for contractors, independent contractors' partners and sole proprietors. The measure gives Delaware a competitive advantage for businesses by lowering workers compensation insurance premiums. The reforms are designed to reduce premiums by 15 to 25 percent. The anticipated savings will come from the creation of a fee schedule for medical reimbursements and from the development of health care practice guidelines or medical protocols for the treatment of injuries. This was the first major overhaul of the state's workers compensation laws since benefits were first provided in the early 1900s. For more information on Workers Compensation please go to the Delaware Department of Labor website.
Delaware's "New Economy Initiative" is focused on attracting new businesses and growing existing businesses. The Initiative has eight program grant offerings.
 The Delaware Competitiveness Fund provides one-time investments to preserve jobs by supporting modernization of facilities. Grants from the $12.5 million fund can be used to implement new manufacturing processes, bring in new product lines, find buyers for idled facilities, or bring in research and development operations. The Venture Capital Fund supports Delaware-focused private sector investment in emerging businesses. The $3 million fund has the potential to leverage up to an additional $6 million in federal funds.
The Technology-Based Small Business Seed Fund provides grant funds to entrepreneurs to start their own technology companies with commercial potential.
The Virtual Emerging Technologies Incubator provides services to start-up technology firms - including general legal advice, accounting, marketing, financial, patent, and trademark services - via the internet, webcasts, interactive sessions, chat rooms, self-paced learning modules and more.
The Clean Energy Research Center provides grant funds and support for the fuel cell industry.
Clean Energy Performance Grants support manufacturers of photovoltaic cells, fuel cells, and wind energy components. Grants are awarded based on their sales of these components.
The Experimental Program to Stimulate Competitive Research, or EPSCoR, is a National Science Foundation program that provides states with a two-to-one match of funds invested to stimulate research. Delaware has made a $4.5 million investment, which enables $9 million in EPSCoR funds to support Delaware's colleges and universities to work together on biotechnology-focused research, education, and economic development projects.
The Strategic Fund is available to companies that create and retain jobs. |
 The Delaware Technology Park in Newark is devoted to attracting established industries and providing incubator space for startups in the high-technology fields. |
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The state of Delaware recognizes capital investments in manufacturing or wholesaling facilities. Eligible companies may apply for the following tax credits:
Expansions without Employment
Manufacturing or wholesaling businesses that invest in a new or expanded facility equal to or exceeding the greater of: (a) $1 million, or (b) 15% of the unadjusted basis of the facility, are eligible for corporate income tax credits equal to 75% of the credit described above, subject to the carry-over provisions, and further limited to a maximum lifetime credit of $500,000. To qualify for this credit, the employer must maintain employment at the expanded facility equal to 85% of the wages paid during the previous year.
Replacement Facilities
Investment in replacement facilities qualifies for corporate credits and license gross receipt reductions if the investment exceeds the greater of: (1) 150% of the unadjusted cost basis of the facility being replaced, or (2) 100% of the market value of the facility being replaced.
Public Utility Tax Rebates
Tax Credits are available for a rebate of 50% of the public utilities tax imposed on new or increased consumption of gas and electricity for five years. The public utilities tax rate is 4.25%. The utility tax on the consumption of electric by licensed manufacturers and food or agribusiness processors is reduced to 2%. Additionally, electric consumed in the manufacturing of automobiles is exempt from the utility tax.
Gross Receipts Tax Reductions
In addition to corporate income tax credits, qualifying firms will not be subject to gross receipts taxes for the first five years and will then have gross receipts taxes reduced on a declining scale for the next 10 years, beginning with a 90% reduction on the sixth year and ending with a 5% reduction the 15th year. |
 The Port of Wilmington is a full-service deepwater port and marine terminal. It handles over 400 vessels and over five million tons of import/export cargo per year. The port is the busiest on the Delaware River. |
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