Sumner County Economic Development Commission will work with the State of Kansas and local officials to provide a detailed, customized, competitve incentive package for your company should you be interested in relocating or expanding your business in Sumner County.

State of Kansas Incentives

Job Expansion & Investment Tax Credit
Businesses must be a revenue producing, taxpaying qualified business facility and must create at least two net new jobs.  

Benefits:

• Income tax credit of $100 per $100,000 of investment
• Job creation tax credit of $100 per net new job created
• May offset up to 50% of state tax liability

Enhanced Enterprise Zone

Sumner County is considered an Enhanced Enterprise Zone. Tax credits earned may be used to offset 100% of the business' annual state income tax liability.  Unused credit may be carried forward indefinitely and applied to subsequent tax years until used.  Manufacturing businesses must create two net new jobs, non-manufacturing and non-retail businesses must create five net new jobs, and national headquarters and ancillary operations must create 20 net new jobs.  Retail businesses  located in a city whose population is less than 2,500, creating two net new jobs, may claim sales tax exemption only. 

Benefits:

• One time job creation tax credit of $2500 per net new job
• Investment tax credit of $1000 per $100,000 (1%) qualified business facility investment
• Sales tax exemption on the purchase of personal property or services purchased for the purpose of constructing, reconstructing, enlarging, remodeling, or equipping a qualified business facility

High Performance Incentive Program (HPIP)
Investment tax credit for companies that pay above average wages and have a strong commitment to skills development for their workers.  Companies must pay an above average industry wage and invest an amount equip to 2% of payroll in employee training or participate in a State training program.  The business activities must fall within NAICS codes other than those for agriculture, mining, construction, and retailing.  For companies that are otherwise eligible but are not manufacturers, at least 51% of revenues must be generated from sales to Kansas manufacturers, and/or out-of-state commercial, or governmental customers.  Businesses must submit a "Capital Investment Project Description" form prior to committing to the defined investment.

Benefits:

• Tax credit for capital investment, with a 10-year carry-forward, equal to up to 10% of the eligible investment that exceeds $50,000
• Exemption from sales tax for eligible capital investments/services
• Potential workforce training tax credit up to $50,000 per year on training expenditures above 2% of the company payroll
• Priority consideration for other assistance programs offered through Commerce, KTEC, or MAMTC

Utilities Sales Tax Exemption
Machinery Sales Tax Exemption
Sales Tax Exemptions

Electricity, gas, and water consumed to run machinery and equipment to produce, manufacture, process, mine, drill or refine tangible personal property is exempt from state and local sales tax.

The sale of machinery and equipment (including repair and replacement parts) which is used in Kansas as an integral/essential part of an integrated production operation by a manufacturing or processing plant or facility is exempt from sales tax.  The installation, repair, and maintenance services performed on this equipment is also exempt from sales tax.

For qualifying companies, both the Enterprise Zone Program and High Performance Incentive Program offer 100 percent sales tax exemption on the purchase of labor and materials to construct or remodel a facility, as well as on the machinery, equipment, furniture and fixtures used in the facility.  Other Sales Tax Exemptions include:

• Labor related to original construction
• New machinery and equipment for manufacturing and distribution
• Pre and Post - production machinery and equipment, including raw materials handling, waste storage, water purification and oil cleaning, as well as ancillary property such as gas pipes, electrical wiring and pollution control equipment.
• Tangible personal property that becomes an ingrediant or componet part of a finished product.
• Tangible personal property that is immediately comsumed in the production process, including electric power, natural gas, and water.
• Incoming and outgoing interstate telephone or transmission services (WATTS)
• Real and personal property financed with an Industrial Revenue Bond (IRB).

Inventory Property Tax Exemption
Property tax exemption for merchants' and manufacturers' inventory that includes items that are primarily held for sale in the ordinary course of business (finished goods), are in process of prodution for sale (work in progress), or are to be consumed either directly or indirectly in the production of finished goods (raw materials and supplies).

Benefits:

• Items of inventory are exempt from property tax

Machinery & Equipment Property Tax Credit
A tax credit against the income tax, privilege tax, and insurance company premiums tax equal to 25% of the personal property tax paid on qualifying machinery and equipment.  Qualifying machinery and equipment means commercial and industrial machinery required to be listed for property taxation on Schedule 2,5, or 6 by a for-profit business required to file an income tax, privilege tax, or insurance company premiums tax return.  Property tax must have been levied and timely paid during the tax year for which credit is taken.

Benefits:

• Tax credit equal to 25% to offset a for-profit business taxpayer's state income tax, privilege tax, and/or insurance company premiums tax liability.  The amount of credit that exceeds the tax liability will be refunded.

Commercial & Industrial Property Tax Exemption
All commercial and industrial, telecommunications and railroad machinery and equipment acquired by qualified purchase or lease made or entered into after June 30, 2006 as a result of a bonafide transaction, not consummated for the purpose of avoiding taxation or transported into Kansas after June 30, 2006 for the purpose of expanding an existing business or the creation of a new business, shall be exempt from personal property tax. 

Research Tax Credit
Taxpayers who invest in research and development are entitled to tax credits against Kansas income tax liability for qualified research expenditures as defined in federal internal revenue code of 1986, amended.

Benefits:

• Tax credit equals 6.5% of the amount by which the company's investment in research and development exceeds the average expenditure of the previous 3-year period
• 25% of the allowable annual credit may be claimed in any one year
• Unused credits may be carried forward indefinitely

Day Care Facilities Tax Credit
Tax credits against Kansas income tax liability for businesses providing child care services to employees.  Credits apply to taxpayers who pay for or provide child day care services for their employees or that provide facilties and necessary equipment for child day care services.  Day care facilities must be licensed or registered pursuant to Kansas law.

Benefits:

• Credit amount is based on the amount spent by the taxpayer less any contribution from its employees or other source
• Not to exceed $45,000 for the first year facility is established
• Not to exceed $30,000 for subsequent years
• Any approved credit that exceeds the taxpayer's tax liability for the tax year will be refunded

Work Opportunity Tax Credits (WOTC)
The Work Opportunity Tax Credit and the Welfare-to-Work tax credit are federal income tax credits that encourage private-for-profit employers to hire job seekers who face the greatest barriers to employment.  Hires not eligible for certification include relatives, non-related dependents, self-employed individuals, non-qualifying re-hires, majority stockholders, members of partnerships, and Sub-Chapter S shareholders.

Benefits:

• Federal tax credit up to $2400 per qualified hire

Work Force Training (KIT) & (KIR)
The KIT and KIR programs can pay for the costs of training new employees or retraining existing workers. Instructors may come from your supervisory staff, community colleges, area technical schools, consultants, vendors, or other sources.  Training may take place at your business, a local school, or temporary rental facility.  Eligible costs include instructors salaries, curriculum planning and development, travel expenses, materials and supplies, training aids, minor equipment, and certain training facilities.

Kansas Industrial Retraining (KIR)
For companies restructuring their operations through incorporation of existing technology, development and incorporation of new technology, diversification of production or the development and implementation of new production activities whose employees are likely to be displaced due to obsoleter or inadequate job skills or knowledge. This program will provide assistance for retraining existing employees.  Positions being retrained must be paid a minimum wage of at least $11 per hour in the metro-counties and $9.50 per hour elsewhere.

Benefits:

• Company must provide dollare-for-dollar match
• Maximum $2000 per employee

Kansas Industrial Training (KIT)
Designed to help new and expanding companies offset the costs of training workers for new jobs.  Training funds can be used to reimburse negotiated costs for pre-employment, on-the-job, or classroom training.  Companies must create one new job that pays an average wage of at lease $11 per hour in the metro-counties and $9.50 per hour elsewhere.

Benefits:

• Up to 100% training costs
• Maximum $2000 per employee

Kansas International Trade Show Assistance Program (KITSAP)
Financial support to Kansas companies exhibiting in foreign and domestic trade shows attracting substantial international buyers.  Products or services must originate within the state and the company must be exhibiting for the first time and submit an application prior to attending the trade show.

Benefits:

• Reimbursement of 1/2 of a company's eligible direct exhibition related expenses
• Up to $3500 per foreign trade show
• $4000 annual maximum in total combined assistance

Other Tax Incentives Programs and Business Initiatives

Market Research
Free market research assistance is available for your product in internationsal markets.  The professional, multilingual staff in our Kansas state officesa offer direct and immediate assistance, information, introductions, and qualified agent/distributor searches around the globe.

Right-to-Work State
Kansas is a Right-to-Work State.  Union membership is well below the national average.

Research Tax Credit
Kansas offers an income tax credit equal to 6.5% of a company's investment in research and development above an expenditure of the previous three-year period.  Only 25% fo the allowable annual credit may be claimed in any one year.

No Local Income Taxes
Kansas cities and counties do not impose income or earnings taxes on personal or corporate income.

Phase Out of Kansas Franchise Tax
The 2007 Kansas Legislature passed legislation to phase out the franchise tax.  The tax will be repealed altogether by tax year 2011.

Reduction of Unemployment Insurance Rates
Kansas has significantly reduced unemployment insurance rates for existing and new employers.

Reduction in Corporate Income Tax Rate
Kansas will reduce it corporate income tax rate from 7.35 to 7 percent by 2011.

Local Incentives

Hubzone Designation
Sumner County is an SBA designated Hubzone.  This designation is in place until at least June of 2011.  This program is designed to stimulate economic development and create jobs in urban and rural communities by providing Federal contracting preferences to small businesses within these zones.

Property Tax Exemption
Cities and Counties may exempt real property from ad valorem taxation.  A total or partial tax abatement may be in effect for up to 10 years after the calendar year in which the business commences its operations. 

Neighborhood Revitalization
This program provides for a 95% rebate of property tax paid on the difference in taxes assessed on the property prior to the start of a project and taxes assessed on the property upon completion of the project.  This is available for 5 years and is subject to complying with the terms of the program.  This is available not only for businesses but for residential also.

Other Local Incentives
Some of our Cities have additional incentives specific to their locations.  The Sumner County Economic Development Commission will work with the Cities to determine what additional incentives may apply to your company.

Please contact our office for additional information regarding any of these incentives. 

Sumner County Economic Development Commission
PO Box 279
Wellington, KS 67152
620-326-8779
scedc@co.sumner.ks.us