May 22, 2018 - In a victory for Southwest Virginia, Governor Ralph Northam has signed into law legislation reauthorizing the critical Metallurgical Coal Tax Credits and a second measure that provides income tax exemptions for companies that are wiling to locate in certain economically-distressed parts of the Commonwealth.
Both bills are vital to Southwest Virginia, and will help with job creation and retention.
The coal tax credit legislation had been a point of contention between Southwest Virginia lawmakers and former Democratic Gov. Terry McAuliffe, who repeatedly vetoed the coal tax bill. But Northam, a moderate Democrat, has demonstrated a welcomed willingness to work with area lawmakers on the bill.
As a result of those negotiations with Senator Ben Chafin, R-Russell and Delegate Terry Kilgore, R-Gate City, a compromise agreement was reached that represents a new approach to the coal tax credits.
Under the revised legislation signed into law Saturday by Northam, the new coal tax credits will increase the competitiveness of Virginia metallurgical coal in the national and international markets.
Metallurgical coal, used in the process of making steel, represents a significant portion of the coal mined in Southwest Virginia, Chafin and Kilgore said. Coal mining in Virginia has an economic impact across the state in the railroad industry and at the Port of Virginia.
Northam traveled to Tazewell County last week to participate in a formal signing ceremony for the second measure, House Bill 222. The legislation creates tax credits and offers grants designed to encourage businesses to locate in economically distressed parts of the Commonwealth, including Southwest Virginia and Southside Virginia. The measure was drafted by Delegate James W. “Will” Morefield, R-Tazewell.
As part of the legislation, if a company invests a minimum of $5 million in capital investment and creates at least 10 full-time jobs with at least one-and-a-half Virginia minimum wage or the company simply creates at least 50 full-time jobs with at least one-and-a half Virginia minimum wage, they will be exempt from Virginia corporate income tax for a period of seven years.
The measure provides another economic development tool for the region that should help in attracting new industries and jobs to the region.
By providing tax exemptions to new companies and incentives for their employees, the hope is that prospective businesses and industries will take a second look at the greater Southwest Virginia.
We join the Southwest Virginia delegation in applauding Northam’s decision to sign these two important measures into law
Given the current economic challenges faced by the deep south counties, it is our hope that the two new bills will help with job creation and retention.
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