The Virginia Enterprise Zone (VEZ) Program, a partnership between state and local governments, offers businesses a unique opportunity to expand their operations while reducing costs. One of the key incentives provided under this program is the Job Creation Grant (JCG), designed to encourage businesses to create new jobs in designated Enterprise Zones across the state.
What Is the Job Creation Grant and How Does It Work?
The Job Creation Grant (JCG) is a financial incentive program designed to reward businesses that create new, permanent full-time jobs within Virginia’s Enterprise Zones with cash grant awards. To qualify, companies must add at least four net new full-time positions over their base year employment. The base year can be any of the two calendar years immediately preceding the first grant year. For example, businesses applying for the 2024 grant cycle can use 2023 or 2022 as their base year.
Eligible positions must meet specific wage and benefit requirements. For most businesses, this means the new jobs must pay at least 150 percent of the minimum wage, with employers offering to cover at least 50 percent of the employee’s health insurance premium. In High Unemployment Areas (HUAs) or for businesses that are SWaM-certified (Small, Women-owned, and Minority-owned), the wage threshold is slightly lower at 125 percent of the minimum wage.
The JCG offers significant financial rewards for businesses that meet these criteria. Companies can receive up to $800 per year for each position that pays at least 175 percent of the minimum wage and offers health benefits. Positions paying between 150 percent and 175 percent of the minimum wage can qualify for up to $500 per year. For firms in HUAs or those that are SWaM-certified, positions paying at least 125 percent of the minimum wage with health benefits can also qualify for up to $500 per year.
For the purposes of the JCG, “minimum wage” refers to the federal minimum wage or the Virginia minimum wage, whichever is higher, as determined for the current calendar year as of December 1 of the prior calendar year. For the upcoming Grant Year 2024, which includes jobs created in the calendar year 2024, the Virginia state minimum wage was set at $12.00 per hour as of December 1, 2023, which is higher than the federal minimum wage.
Grants are available for a period of five consecutive years, provided the business maintains or increases the number of eligible positions above the initial four-job threshold. It’s important to note that businesses can receive grants for a maximum of 350 positions per year across all their locations within Enterprise Zones. (See Virginia’s Enterprise Zone Map.)
Image Source: Virginia Enterprise Zone Program (VEZ)
Grant Distribution and Sector Eligibility
In Grant Year 2022, the Job Creation Grant program distributed a total of $1,795,246, fully meeting all funding requests. Manufacturers received the largest portion of the grants, accounting for 61 percent of all grantees. The construction sector followed, representing 13 percent of the total qualified firms. The remaining 25 percent of grants were distributed across sectors such as Health Care/Social Assistance, Professional/Other Services, Wholesale Trade, Administrative, and Finance and Insurance, with each of these sectors contributing no more than three jobs per business.
It’s important to note that sectors such as retail, food and beverage, personal services, and nonprofit positions are not eligible for JCG benefits.
How to Apply
Applying for the JCG is a straightforward process, but it’s crucial to adhere to the program’s timeline and documentation requirements. Applications must be submitted online through the EZ Application Submission System by April 1, 2025. Late applications or those missing required documents will only be processed if funds remain after all on-time applications have been fully funded.
To apply, businesses need to complete and submit several key documents, including:
- The Commonwealth of Virginia W-9 Form
- The Local Zone Administrator (LZA) Review Form
- The Applicant Declaration Form
- The JCG Worksheet (or JCG-HUA/SWaM Worksheet)
- A CPA Attestation Report, if applicable
These documents ensure that the business meets all eligibility criteria and provides the necessary evidence to qualify for the grant.
Note: Businesses with a base year employment of 100 or fewer permanent full-time positions, and that create 25 or fewer grant-eligible positions, are not required to submit a CPA attestation as part of their JCG application materials. However, you may want a CPA to review the JCG worksheet for errors before submission.
Maximizing the Benefits
The Job Creation Grant offers businesses a powerful tool to offset the costs of expanding their workforce. By understanding and leveraging this grant, companies can reduce labor costs, making it more financially viable to add new employees. This can be especially beneficial for businesses in high-growth phases or those looking to expand their operations in Virginia’s Enterprise Zones.
Applicants can also benefit from applying for both the JCG and the Real Property Investment Grant (RPIG) under the VEZ program for the same project, provided they meet the eligibility requirements for each grant.
In addition to these state incentives, local governments offer a range of additional benefits, including tax abatements and rebates, business loans, job training programs, public improvements, fast-track permitting, and development fee waivers, among others.
What’s Next
The Job Creation Grant is a valuable opportunity for businesses operating within Virginia’s Enterprise Zones. By taking advantage of this program, companies can not only expand their workforce but also improve their financial position through significant cost savings.
Submit your application before the next deadline of April 1, 2025, to take advantage of the Virginia Enterprise Zone Program and grow your business. For more information or to start the application process, contact Shawn Middleton, Partner and PBMares’ Enterprise Zone Segment leader.
