VOL. 117 | NO. 87 | Friday, May 2, 2003
Renewal Community conference touts tax credits for the taking
Renewal Community conference touts tax credits for the
By STACEY WIEDOWER
The Daily News
The eight to 10 employees who qualify T.W. Jones Jr.s
company for Renewal Community Employment Credit tax incentives probably dont
realize their residence within the citys 48 Renewal Community census tracts
add to the companys overall profits.
They just know their employer gave them a nice raise this
We got a benefit from the federal government, and were
going to pass that on, said Jones, owner of T.W. Jones Packaging Group, a
recycler of industrial bulk containers.
If they were going to get a 30 cent an hour raise, they
probably got more like a 60 cent an hour raise, because part of that tax credit
works out to be, in our case, anywhere from 50 to 75 cents an hour per man.
So if I can pass that on to them, it really doesnt hurt me
at all, as long as were making a profit.
Jones hiring strategy now centers around the Renewal
Community tax incentive program that Memphis has participated in since January
2002. For every employee who lives within the 40-mile RC-designated area, Jones
receives a $1,500 yearly tax credit.
Dottie Jones, administrator of the program for the citys
Office of Intergovernmental Relations, hopes to see more employers who qualify
for RC incentives use the program in the same way.
One of the important things for people to understand is
that if they are hiring someone, they need to look at where that person lives,
she said. If theyre faced with hiring an employee and they have two equally
qualified candidates but one comes with a tax credit and one doesnt well,
any intelligent business person is going to want to hire the person that comes
with the credit.
The employment credit is one of seven tax incentives for
business owners whose companies either are located in the Renewal Community or
employ residents of the RC, which includes parts of Downtown, Midtown, Whitehaven
and the Memphis International Airport, among other areas. The incentives come
in the form of wage credits, deductions and capital gains.
A free conference designed to teach more citizens and
business owners about the tax credits takes place Tuesday and Wednesday at the
Downtown Marriott, 250 N. Main St.
Memphis qualified as a Renewal Community based on several
criteria, including the fact that each of the 48 census tracts included in the
community has a poverty rate greater than 20 percent.
In addition, the aggregate group has an 18.6 percent
unemployment rate, nearly doubling the 9.4 percent rate required of an RC.
Also, about 75 percent of households in the Memphis RC qualify as low-income,
exceeding the programs requisite 70 percent.
Its a sad thing to say, but the poorer the area that you
designated, the better your chances (to qualify as an RC), Dottie Jones said.
But, qualification for the eight-year designation is a big
plus for the 4,900 businesses located in the RC and others that employ residents
of the community, she said.
Its a really cool program, she said. Theres no
certification process, they dont have to get a piece of paper from the city or
the state that says theyre a Renewal Community business they just have to
file a form on their income taxes.
However, many business owners are not yet aware of the
benefits the RC designation brings, a fact the city and the U.S. Department of
Housing and Urban Development wants to change.
Over an eight-year period, businesses throughout the 48
census tracts involved in the RC can take advantage of close to $3 million in
tax incentives, said HUD operations specialist Dorothy Cleaves. This was the
first year (2002) that people could really take advantage of it. And we didnt
see the participation that we really wanted.
So what were doing is making a push to educate the
community about these tax incentives.
HUD and the city are sponsoring the Renewal Community Tax
Incentive Conference, which begins at 9:15 a.m. Tuesday and at 8:30 a.m. Wednesday,
to provide business owners with workshops designed to help them take advantage
of the program.
A street fair that runs from 4:45 p.m. to 7 p.m. Tuesday
will give business owners who cant get away during the workday a chance to
meet with various professionals and government representatives to learn more
about RC tax incentives.
Dottie Jones hopes the conference will help spread word
about the RC designation so qualifying business owners will at least know
enough about the availability of RC tax benefits to ask their tax preparers
When people leave, they dont need to be experts on these
credits, but they need to know enough to know to ask, she said. They need to
know enough to call whoever prepares their taxes and say, Excuse me, did you
know anything about this? Well, you ought to.
Thats what were hoping.