Financing & Incentives


Minnesota's Job Opportunity Building Zone (JOBZ) program is the most significant jobs incentive program in state history. It was launched in January 2004 to stimulate economic development activity outside the Twin Cities metro area.
" JOBZ is the mother of all incentives."


Minnesota Governor Tim Pawlenty


Tax Free JOBZ Development Zone

Closest Tax-Free JOBZ Zone to Minneapolis

Cambridge is the closest tax-free JOBZ development zone to Minneapolis —just 45 miles straight north of downtown. Businesses that locate or expand in Cambridge's JOBZone save thousands in taxes each year through 2015.


High-Value Tax Exemptions

Minnesota tax exemptions include:

  • Property tax on commercial and industrial improvements
  • Sales tax on goods and services
  • Corporate franchise tax
  • Income tax for operators or investors
  • Capital gains tax
  • Employment tax credit for high-paying jobs
  • Wind energy production tax

 

Property tax exemptions do not apply to:

  • Local general obligation bond debt
  • School operating levy referendum
  • Land (only improvements to land are exempt)
  • Vacant buildings (while vacant)


JOBZ Qualified Businesses

Four types of business scenarios qualify for JOBZ benefits:

  • Businesses in the zone at the time of its JOBZ designation
  • Business expansion in the zone
  • Business relocations from other states
  • Business relocations from other parts of Minnesota if they increase employment by 20% the first year or make a capital investment equal to 10% of the previous year's gross revenues


Example of Tax Savings: Metal Fabricating Company

  • Distribution/warehouse company with all operations in JOBZone
  • Construction of a 55,000 sq. ft. building valued at $2,700,000 in 2010
  • Annual taxable income of $1,000,000
  • A total of 50 employees
  • Average wage of $30,000
  • Purchase of taxable goods and services totaling $200,000 annually

 

Average Annual Tax Savings
Corporate Income Tax $26,470 5-year average
Sales & Use Tax 37,640 5-year average
Property Tax $64,570 5-year average
Total Average Benefit $128,680 6-year average
Total 5-Year Benefit $643,400

 

Summary of Estimated Tax Savings
 CY Corp Franchise Tax Savings Sales Tax Savings State Property Tax Savings Local Property Tax Savings, Excl School District Job Creation Credit Annual Benefit Cumulative Benefits
2011  25,200 132,900  0  0  0  158,100  158,100
 2012  25,800  13,300  0  0  0  39,100  197,200
 2013  26,450  13,650  31,700  73,250  0  145,050  342,250
 2014  27,100  14,000  33,500  75,100  0  148,700  490,950
 2015  27,800  14,350  33,300  77,000  0  152,450  643,400
 Total  132,350 188,200  97,500  225,350  0  
  643,400
NOTE: Estimates are in nominal dollars and exclude the impact of JOBZ exemptions on other tax liabilities.

 

Contact the Cambridge Economic Development Department for more details.