Overview of the City's Business Incentives
ZoomBiz - Business Incentives Map
FINANCIAL INCENTIVES
1. Government Property Lease Excise Tax (GPLET) *
The GPLET can provide up to eight (8) years of property tax abatement. This incentive is available for projects located in the Central Business District that result in a property value increase of at least 100%. The amount abated cannot exceed the economic benefit created by the project. To become "government property" the City will take ownership of the property for the duration that the owner wishes to be relieved of tax obligations. Applications for this incentive are currently being accepted. See map
2. Primary Jobs Incentive*
The Primary Jobs Incentive assists Tucson in its efforts to bring quality jobs and investment into the region. The incentive provides up to a 100% credit of construction sales tax to qualifying expenses such as job-training, the project’s public infrastructure improvements and/or offsets to impact fees. The City will also waive building permit fees. Eligible projects must: a) invests a minimum of $5 million in facilities or equipment, b) creates 25 jobs that pay average wages of at least $60,000, and c) cover at least 75% of employee health insurance premiums.
3. Site Specific Sales Tax Incentive*
For retail projects that would not otherwise locate in the city of Tucson, the City can apply project-generated tax revenues to qualifying public expenses such as job training or public infrastructure improvements. Projects must create significant and quantifiable economic benefits to be considered. The amount of sales tax revenue applied cannot exceed the economic benefit created by the project.
LOAN PROGRAMS
4. Tucson Community Development Loan Fund*
The City of Tucson has a $20 million HUD 108 loan fund that can be used as gap financing for projects that create jobs for low and moderate income persons, eliminate blight or meet urgent community needs. Tucson Community Development loans carry highly competitive interest rates with fixed terms up to 20 years. Eligible activities include real property acquisition, rehabilitation of real property, relocation, clearance and demolition, site preparation, public facilities improvements, issuance costs, capitalized interest and reserves.
5. Tucson Industrial Development Authority (TIDA) Bonds and Loans
The TIDA may provide financing of projects whenever appropriate and where traditional sources of funding may not be available. Projects must serve a public purpose and meet eligibility requirements of the TIDA. The TIDA places an emphasis on new and expanding businesses where sources of traditional capital are not available.
BUSINESS ASSISTANCE PROGRAMS
6. Green Business Certification Program
The City of Tucson can help businesses operate more sustainably and save money on utility bills. The program provides businesses in Tucson with technical expertise for reducing resource consumption in the areas of energy/transportation, water use, waste production and pollution prevention/purchasing. Businesses can then use this information to reduce resource consumption. Businesses that complete the program receive certification that can be used in their marketing programs.
7. Historic Preservation Tax Credits
There are 566 designated historic buildings in commercially-zoned areas in the city of Tucson and another 1,040 buildings that are potentially eligible for historic designation. Approved rehabilitations of these properties are eligible for significant federal and state tax credits. See map
8. Small Business Enterprise Program (SBE)
The SBE program offers opportunities to small businesses in Tucson interested in submitting bids for contracts administered by the Procurement Department. Benefits include bid preferences and subcontracting goals for construction, goods, services, and materials. SBE applicants may represent of any and all ethnic and gender groups.
DEVELOPMENT SERVICES PROGRAMS
9. Certificate of Occupancy Relief
A new Certificate of Occupancy is not required for a new tenant of an existing building unless the occupancy classification changes for any portion of the building. This policy significantly facilitates development by reducing permit fees and enabling a new tenant to use existing site and/or floor plans.
10. Cross-Trained Inspectors
The City has cross-trained building Inspectors so that, for routine inspections, one inspector can inspect all areas, including structural, electrical, plumbing, heating, ventilation and air conditioning. These combination inspections allow for a smoother, more efficient inspection process, saving businesses time and money.
11. Development Package Review
The Development Package Review provides simultaneous reviews for Site Development and Grading Plan review. Applicants use a development package menu to select the types of reviews needed and the review agencies required for review. The Development Package Review process greatly reduces the review time and increases review consistency.
12. Impact Fee Deferral
Impact fees for roads, parks and public facilities may be deferred until the Certificate of Occupancy is received in exchange for a contribution to the City’s Housing Trust Fund.
13. Ombudsman Program
The Ombudsman Program ensures that significant projects provided with the resources needed to move as effectively and swiftly as possible to completion. At the City Manager’s direction, an Ombudsman will be assigned to a project to help coordinate and manage City processes until the project is finished.
14. Planned Area Development (PAD) Streamlining
Within the Greater Infill Incentive and the Downtown Core Subdistricts, the rezoning process to create Planned Area Developments less than 40 acres has been streamlined. These rezoning requests no longer require pre-approval by the Mayor and Council but can go directly to the Zoning Examiner then are subject to final consideration by Mayor and Council.
15. Solar Fee Waiver
The City of Tucson has created a $200,000 fund to allow permit fee waivers on Qualifying Solar Energy System installations. The maximum amount that can be waived is $1000 for any single new or retrofit installation or $5,000 for any multiple installation project. The waiver will be in effect until the fund is depleted.
INCENTIVE AREAS & DISTRICTS
16. Downtown District - Financial Incentive
A $10,000 building permit fee waiver per project and a construction sales tax credit for public right-of-way improvements are available for developments in this district. See map: tucsonaz.gov/tdc.pdf
17. EPA Brownfields Project Area
Developments within the EPA Brownfields Project Area can receive City grants to fund Phase I and II Environmental Site Assessments. Phase I assessments can cost up to $3500 and Phase II assessments can cost up to $20,000. See map
18. Central Impact Fee Benefit District
Road impact fees are reduced by 23% for any developments within the Central Impact Fee Benefit District. Reductions are applied at time of assessment. See map
19. Infill Incentive District - Greater Infill Subdistrict
Flexible development options in the Greater Infill Incentive Subdistrict relieve property owners from parking, loading, and landscaping standards as well as certain other dimensional requirements and allow height increases up to sixty feet in more restrictive zones if the development supports transit and pedestrian oriented development. Developers can also benefit from a streamlined Planned Area Development rezoning process. See map
20. Downtown Core Subdistrict - Infill Incentive District
In addition to the options listed within the Greater Infill Incentive Subdistrict, developments in the Downtown Core Subdistrict may receive up to 100% reduction in parking requirements as well as loading, setback and landscaping reductions. See map
21. Main Gate Overlay District
A zoning overlay in the “main gate” area adjacent to the University of Arizona promotes transit-oriented design and adaptive reuse of historic properties. Some of these overlay allowances include greater heights, reduced setbacks, and flexible options for re-use and restoration of historical properties. See map
INCENTIVES ADMINISTERED BY OTHER AGENCIES
1. Business Alliance Loan Program
Arizona's Business Loan Alliance is a groundbreaking, $12 million loan collaborative designed to help small business owners secure the capital they need to flourish. Loans range from $50,000 to $500,000 and carry favorable rates and terms for creditworthy companies that lack adequate equity investment or sufficient collateral to secure a conventional loan.
The Business Loan Alliance, made up of a diverse group of public and private entities, has committed a total of $12 million to creatively kick-start the flow of capital in this challenging business climate. The purpose of the pilot program is to generate and attract greater investment for Arizona business owners. The pilot program will operate for approximately 12 months or until the funds are fully deployed. Qualified loans may be eligible for a guaranty of up to 20 percent from SCF Arizona.
2. Arizona Commerce Authority (ACA)
The
ACA is an aggressive, finely tuned economic development organization committed to attracting and retaining the best of the best in business and to creating quality jobs for Arizona and its citizens. The ACA administers 14 incentives that assist small business.
* Available for projects that create significant and quantifiable economic benefit for the City of Tucson. A third-party economic impact analysis will ultimately determine eligibility. Interested candidates may contact the Economic Development Manager for a consultation.
