7 counties change tiers in '09 economic development rankings

Chowan and Wilkes counties have been designated as two of the state's 40 most economically distressed counties for 2009. The new county tier designations, released by the N.C. Department of Commerce on Dec. 1, determine a variety of state funding opportunities to assist in economic development.

Under the law governing what are commonly known as Article 3J tax credits, the state's 40 most distressed counties are designated Tier 1 counties. The middle 40 counties are designated as Tier 2, while the 20 most prosperous counties are placed in Tier 3.

In addition to Chowan and Wilkes, Franklin County (Tier 2) was moved down one tier for 2009. The counties of Craven (Tier 3), Duplin (Tier 2), Wayne (Tier 2) and Yancey (Tier 2) all moved up to a higher tier.

Certain businesses that locate in lower-tier counties are eligible for larger tax credits than those that locate in higher-ranked counties. The rankings are based on an assessment of each county's unemployment rate, median household income, population growth, and assessed property value per capita. In addition, any county with a population of less than 12,000 or a county with a population of fewer than 50,000 residents with 19 percent or more of those people living below the federal poverty level automatically are designated as one of the 40 most distressed counties.

Potential benefits to companies under each tier designation include:

• Tier 1 designees can offer a $12,500 tax credit per new job with a requirement to create at least five jobs, and a 7 percent tax credit for eligible business property expenditures.
• Tier 2 designees can offer a $5,000 tax credit per new job with a requirement to create at least 10 jobs, and a 5 percent tax credit for eligible business property expenditures of more than $1 million.
• Tier 3 designees can offer a $750 tax credit per new job with a requirement to create at least 15 jobs, and a 3.5 percent tax credit for eligible business property expenditures of more than $2 million.

Article 3J tax credits replaced the Article 3A "Bill Lee" tax credits in 2007.