Virginia primes itself for a tax experiment in rural areas

The General Assembly has passed — and sent to Gov. Ralph Northam for his signature — a bill by Del. Will Morefield, R-Tazewell (with help from state Sen. Bill Stanley, R-Franklin County) that offers a seven-year tax break to companies that locate in certain economically-distressed localities and create a certain number of jobs (the number varies depending on the investment). The list of those eligible includes much of Southwest and Southside Virginia, along with many localities along the Chesapeake Bay. The General Assembly also passed a bill by state Sen. Ben Chafin, R-Russell County, that allows localities to declare closed schools to be a “revitalization zone” whereby it can waive certain local taxes and fees. The idea is that these buildings could become incubators for small businesses. Here’s where we get the potential trifecta of tax breaks: There are some localities in Southwest Virginia (and likely elsewhere) that can qualify for all three. Imagine a locality that’s eligible for certain tax breaks under Morefield’s bill. It’s also likely eligible for certain tax breaks under the federal tax bill. And if it has an old school sitting empty, it can declare that a “revitalization zone” under Chafin’s bill — which means an entrepreneur setting up shop there could qualify for yet a third set of tax breaks.