Tax and Financing Opportunities from Connecticut's "JOBS" Bills

JOBS Bill Financing Opportunities

Airport Development Zones Expansion

  • Connecticut provides certain tax exemptions and credits for businesses within certain airport development zones. The Jobs Bill allows the Connecticut Airport Authority to expand existing airport development zones.

Angel Investor Tax Credit 

  • Income tax credit equal to 25% (up to $250,000) of cash investment made in a qualifying business by an angel investor.
  • Minimum investment of $25,000 to qualify as an angel investor.
  • Qualifying businesses must will (i) have gross revenues under $1 million in its most recent income year, (ii have fewer than 25 employees, at least 75% of whom are Connecticut residents, (iii) have operated in Connecticut for less than seven consecutive years, and (iv) have received less than $2 million in eligible investments from angel investors.

Captive Insurance Company Tax Credit

  • Any captive insurance company licensed after January 1, 2012 will receive a one-time nonrefundable $7,500 tax credit.

Expanded Film Industry Tax Credits

  • Relocated television productions now qualify for Connecticut's film tax credit.
  • Film production and infrastructure tax credits are now qualified as "Type 1" credits. These credits can be used by insurers to reduce their 2011 and 2012 insurance premium tax liability up to 55%. Due to the Jobs Bill, film production and infrastructure tax credits are classified the same way as digital animation production companies.
  • Jobs Bill allows tax payer to claim film infrastructure tax credits either in the income year in which the infrastructure investment was made or in any of the three succeeding years.

Job Expansion Tax Credit 

  • Three-year tax credit against insurance premiums and taxes for companies creating Connecticut based jobs.
  • $500 per month for each new Connecticut resident employee.
  • $900 per month for certain types of employees.
  • Small Business Express Program - http://1.usa.gov/szKEwE
  • Revolving loans of up to $100,000 with a maximum 4% interest rate.
  • Up to $250,000 in forgivable loans.
  • Up to $100,000 in grants. Participating business must match state grants.

Manufacturing Reinvestment Accounts ("MRA") 

  • Increases the number of small manufacturers participating in interest-bearing savings accounts. Increases amount able to be invested. MRA funds may be applied towards capital investments and workforce training.

Subsidized Training and Employment Program ("STEP")

  • Subsidizes training costs for employees of small business and small manufacturing
Connecticut Innovations, Inc. - Funding from JOBS Bill

Connecticut Innovations, Inc. - Recapitalization: $25 million per year for the next four fiscal years. Jobs Bill funding distributed, in part, among the following CI entities: 

Bioscience Facilities Fund

  • Helps qualified firms build out wet laboratory and related space through debt and equity financing.

CI Clean Tech Fund

  • Fund focuses on seen and early-stage companies focused on innovations that conserve energy, protect the environment, or eliminate harmful waste. Funding of up to $1 million is available with possible additional investments from the Eli Whitney Fund.

CI Eli Whitney Fund

  • Provides up to $1 million to Connecticut technology and bioscience companies. Qualified companies must have a sustainable competitive advantage, have a beta-stage product proto-type, a proven management team and additional investor interest.

CI Pre-Seed Fund

  • Provides funding, mentoring, business and technical resource to Connecticut technology companies that have been in operation less than seven years, have non-recurring revenues under $2 million and have fewer than 25 employees. This resource provides up to $150,00 for pre-seed expenses (50% matching from private sources is required).
  • Jobs Bill provided $4 million per year in funding.

CI Seed Investment Fund

  • Provides up to $500,000 of investment funds structured as equity, convertible debt, or debt with warrants. This fund targets emerging technology companies.

Small Business support - SBIR Phase II/Other Federal R&D

  • Loans meant to accelerate commercialization of new technologies by companies that have won Phase II SBIR/STTR funding or other significant federal R&D funding (over $500,000).
  • CI is committing an additional $6.5 million to its loan programs.

CTech

  • An initiative of the Pre-Seed Fund, CTech incubators provide early-stage technology companies turnkey office solutions, favorable market rents, and access to an array of resources. CTech has locations in New Haven and Bridgeport and collaborates with UConn in Farmington.

Next 5 Initiative

  • Developing initiative under the Jobs Bill. CI would offer investments to out-of-state businesses of up to $2 million to relocate to Connecticut.
  • CI is considering allocating $7 million total to this initiative.

Small Business support - SBIR Phase I Award Winners

  • Grants designed to bridge funding gap between SBIR Phase I Award Winners and subsequent SBIR awards.
  • Connecticut Innovations is spending $4 million per year to help Connecticut companies capture additional SBIR as well as increasing industry partnerships and the state's technology talent pipeline.