Office of Governor Gary Locke
FOR IMMEDIATE RELEASE - November 17, 1998
Contact: Governor's Communications Office, 360-902-4136
The governor's proposal, one element of his rural-development agenda for the 1999 legislative session, would provide tax credits to attract software companies and businesses that establish "help desk" services to help other companies manage their computer and software systems.
"Information technology business can flourish anywhere in our state — anywhere people have the foresight, knowledge and courage to step up and seize opportunities in the marketplace of the 21st century," Locke said.
The governor made his announcement at ceremonies marking the transfer to local control of the never-completed Washington Public Power Supply System nuclear power plant site in Grays Harbor county. The site is being redeveloped as a technology/industrial park. The Bonneville Power Administration has committed $15 million to the redevelopment project.
The event also marked the opening of Safe Harbor Technologies Corporation's new offices at the Satsop site in Grays Harbor county, which has one of the highest levels of unemployment in the state. Safe Harbor has 10 employees today, but expansion plans would put their number at 200 in two years.
Safe Harbor was started a year ago by three Hoquiam natives who left home to find success in high-tech industries and then returned to establish the computer "help desk" company that provides technical support to business customers and other software users.
"Our state's information-technology industry has become a major economic power, but it has been urban centers that have enjoyed most of the economic benefits," Locke said. "Safe Harbor's success is proof that new developments in the technology industry can help communities away from metropolitan areas."
While also planning new education programs to give Washington residents the skills they need to enter the technology workplace, the governor said tax incentives are needed to encourage software-related businesses to locate or expand in economically distressed counties.
The long-term effect of his tax-incentives program will be to improve the technology infrastructure in distressed counties, increasing software and technology-based jobs in these counties, Locke said.
The tax incentives would be available to technology businesses such as Safe Harbor, which provide "help desk" services to software users, primarily business customers, who need technical support and assistance. These technical-support businesses use trained personnel who rely on the Internet and other telecommunications technology to help customers solve their computer problems.
In addition, the tax incentives would be available to companies that build new or expanded operations in distressed counties for the manufacture or programming of software.
Under his proposal, the governor said technology businesses locating or expanding in distressed counties will qualify for an estimated $1.5 million in tax credits over the next two years through measures including:
* A business-and-occupation (B&O) tax credit for help-desk services related to computer software installation, maintenance, repair, and troubleshooting. Third-party firms in distressed counties would provide the assistance electronically or via telephone. For the first seven years, the credit is equivalent to a 100 percent B&O tax exemption. Thereafter, the credit is reduced to two-thirds of B&O tax liability.
* A B&O tax credit equal to $1,000 per employee is proposed for firms that manufacture computer software or perform custom programming services in distressed counties. The credit can continue for each year the employee position is retained up to seven years. Existing firms are eligible for credit only on new employees added after the legislation goes into effect. Currently, 175 software-related firms are operating in distressed counties.
FOR IMMEDIATE RELEASE - November 17, 1998
Contact: Governor's Communications Office, 360-902-4136
Governor proposes tax credits for info-tech investments in rural areas
SATSOP — Saying all of Washington should share its software success, Gov. Gary Locke today proposed new tax incentives for information-technology businesses that invest in rural areas of the state.The governor's proposal, one element of his rural-development agenda for the 1999 legislative session, would provide tax credits to attract software companies and businesses that establish "help desk" services to help other companies manage their computer and software systems.
"Information technology business can flourish anywhere in our state — anywhere people have the foresight, knowledge and courage to step up and seize opportunities in the marketplace of the 21st century," Locke said.
The governor made his announcement at ceremonies marking the transfer to local control of the never-completed Washington Public Power Supply System nuclear power plant site in Grays Harbor county. The site is being redeveloped as a technology/industrial park. The Bonneville Power Administration has committed $15 million to the redevelopment project.
The event also marked the opening of Safe Harbor Technologies Corporation's new offices at the Satsop site in Grays Harbor county, which has one of the highest levels of unemployment in the state. Safe Harbor has 10 employees today, but expansion plans would put their number at 200 in two years.
Safe Harbor was started a year ago by three Hoquiam natives who left home to find success in high-tech industries and then returned to establish the computer "help desk" company that provides technical support to business customers and other software users.
"Our state's information-technology industry has become a major economic power, but it has been urban centers that have enjoyed most of the economic benefits," Locke said. "Safe Harbor's success is proof that new developments in the technology industry can help communities away from metropolitan areas."
While also planning new education programs to give Washington residents the skills they need to enter the technology workplace, the governor said tax incentives are needed to encourage software-related businesses to locate or expand in economically distressed counties.
The long-term effect of his tax-incentives program will be to improve the technology infrastructure in distressed counties, increasing software and technology-based jobs in these counties, Locke said.
The tax incentives would be available to technology businesses such as Safe Harbor, which provide "help desk" services to software users, primarily business customers, who need technical support and assistance. These technical-support businesses use trained personnel who rely on the Internet and other telecommunications technology to help customers solve their computer problems.
In addition, the tax incentives would be available to companies that build new or expanded operations in distressed counties for the manufacture or programming of software.
Under his proposal, the governor said technology businesses locating or expanding in distressed counties will qualify for an estimated $1.5 million in tax credits over the next two years through measures including:
* A business-and-occupation (B&O) tax credit for help-desk services related to computer software installation, maintenance, repair, and troubleshooting. Third-party firms in distressed counties would provide the assistance electronically or via telephone. For the first seven years, the credit is equivalent to a 100 percent B&O tax exemption. Thereafter, the credit is reduced to two-thirds of B&O tax liability.
* A B&O tax credit equal to $1,000 per employee is proposed for firms that manufacture computer software or perform custom programming services in distressed counties. The credit can continue for each year the employee position is retained up to seven years. Existing firms are eligible for credit only on new employees added after the legislation goes into effect. Currently, 175 software-related firms are operating in distressed counties.
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