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Governor Rendell Moves to Strengthen State Business Environment; Signs SB 854 Creating Four New Strategic Development Areas

Posted on: Monday, 20 November 2006, 12:00 CST

HARRISBURG, Pa., Nov. 20 /PRNewswire/ -- Governor Edward G. Rendell today took another step towards strengthening the commonwealth's business environment by signing Senate Bill 854, which allows for the creation of four strategic development zones that will attract new businesses and encourage job growth.

Modeled after the state's successful Keystone Opportunity Zone program, SB 854 will provide tax incentives for businesses that commit to creating jobs and investing tens-of-millions-of-dollars in key geographic areas of Pennsylvania.

"With today's signing, we're taking another giant step towards strengthening Pennsylvania's economy," said Governor Rendell. "As we've done for four years, we're making good use of our resources by creating an environment that nurtures business growth, which translates into new opportunities for our hardworking men and women."

Two of the four zones will be established in southwestern Pennsylvania, with a third in the Lehigh Valley. The fourth is yet to be determined.

The southwestern zones will support a joint venture by Westinghouse and Toshiba focusing on power plant production. With a capital investment estimated at $400 million, the project is expected to create 1,000 new jobs, while retaining another 2,000.

"For nearly 130 years, Westinghouse has been one of the premier companies in southwestern Pennsylvania," added Governor Rendell. "With our competitive tax climate, skilled workforce, and commitment to alternative energy solutions, Westinghouse chose Pennsylvania as the headquarters for its new global power plant enterprise, because it recognizes that we offer an environment where they can succeed.

"This is fantastic news for the region. These 2,500 hundred jobs -- and the average $92,000 in yearly income associated with each of those jobs -- could have gone to another state. Instead, all 2,500 will stay in the commonwealth, and we can expect 1,000 more."

Under the new law, the Governor will be empowered to identify the strategic development areas (SDAs). Companies choosing to locate in these areas will benefit from state and local tax abatements for 15 years, unless the municipalities and property owners agree to an earlier termination. Local municipal officials must agree to the SDA designation.

Each SDA must be between 10 acres and 1,500 acres in size. The cumulative total land area for all four zones may not exceed 5,000 acres.

To be eligible for the tax breaks, companies must commit to creating or maintaining at least 500 jobs and make $45 million or more in capital investments within three years.

The SDA program enacted today was modeled after the state's Keystone Opportunity Zone program. Companies participating in the KOZ initiative have had a tremendous impact on the state's economy, creating and maintaining nearly 59,000 jobs and investing almost $8.5 billion in the commonwealth.

For more information on Governor Rendell's work to rebuild Pennsylvania's economy and create new opportunities, visit http://www.newpa.com/.

The Rendell Administration is committed to creating a first-rate public education system, protecting our most vulnerable citizens and continuing economic investment to support our communities and businesses. To find out more about Governor Rendell's initiatives and to sign up for his weekly newsletter, visit his Web site at: http://www.governor.state.pa.us/.

Pennsylvania Office of the Governor

CONTACT: Kate Philips, +1-717-783-1116

Web site: http://www.newpa.com/http://www.governor.state.pa.us/

Source: PRNewswire

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