Transfer Opp Fund to Distressed Areas Prog

Item 112 #1c

Language
Page 79, line 20, strike "$1,960,000" and insert "$2,960,000".
Page 79, after line 47, insert:
"C.1. This item includes $1,000,000 the second year from the general fund to support a performance job creation grant program in qualifying economically distressed localities. Localities eligible for participation in the program shall have an unemployment rate at least 175 percent of the statewide average over the past two years.
2. The Department of Housing and Community Development shall administer the performance job creation grant program and shall provide one-time grants to new or expanding businesses meeting the following criteria:  (1) eligible companies shall be in the business of manufacturing or wholesale; forestry or fishing; transportation or information technologies.  Retail establishments shall be ineligible; and (2) provide at least five additional or new full-time qualified positions.  These positions represent net new jobs when compared to a company’s record of permanent positions over the previous two years.  Qualified positions shall mean a minimum of 35 hours of an employee's time a week for the entire normal year of the business firm's operations, which "normal year" must consist of at least 48 weeks, a minimum of 35 hours of an employee's time a week for the portion of the taxable year in which the employee was initially hired for, or transferred to, the business firm, or a minimum of 1,680 hours per year if the standard fringe benefits are paid by the business firm for the employee.  Seasonal or temporary positions shall be ineligible for the grant program.
3.  Any company eligible to apply for a grant under this item shall provide evidence, satisfactory to the Department of Housing and Community Development, of the amount of any capital investment, the number of new jobs created, and such other evidence required by the Department of Housing and Community Development to prove that the requirements and intent of this item have been satisfied, including any certification needed to prove that the qualified positions have been filled continuously over a 12-month period beginning July 1, 2004.
4.  Grants shall be $5,000 for each new employee up to a maximum of $25,000 per business.  If the jobs created by the new or expanding employer has a wage of at least twice the prevailing wage of that locality as determined by the Virginia Employment Commission, the per-employee grant shall increase to $7,500 per employee, up to a maximum of $37,500 per business. Total grants awarded under this program shall be limited to $1,000,000 in fiscal year 2006.
5.  The Department of Housing and Community Development shall report to the Secretary of Commerce and Trade, and to the Chairmen of the Senate Finance and House Appropriations Committees, on the program’s results and any recommendations regarding program improvements or the program’s continuation by December 30, 2005."

Explanation
(This amendment redirects $1,000,000 the second year from the general fund appropriation for the Governor's Development Opportunity Fund to the Department of Housing and Community Development for a grant program geared toward attracting new and expanding businesses to economically distressed localities in the Commonwealth. Eligible companies can be reimbursed up to a maximum of $37,500 per business. Under the program’s criteria, businesses located in the following jurisdictions would have been eligible for participation in the program in fiscal year 2004 based on the prior two years’ unemployment rates: Counties of Appomattox, Buchanan, Dickenson, Grayson, Halifax, Henry, Mecklenberg, Patrick, Pittsylvania, Patrick and Smyth, and the Cities of Danville, Galax, Martinsville and Petersburg.)