Go Zone Program Sees 2/3rds of the Businesses Outside of Coastal Counties
by Keith Burton - GCN       12/29/06

A program passed by Congress designed after Hurricane Katrina to stimulate the area's business economy has generated over $5 billion in tax incentives for businesses participating in Mississippi, but most of the businesses are outside of the most devastated areas.

Known as the Gulf Opportunity Zone Act of 2005 or the GO Zone Act, the program offers several tax benefits to properties built and placed into service in the GO Zone region after the hurricanes. The incentives were made available by the government with the intent to help bring back life once again to the affected areas and rebuild the economies of the state affected by the 2005 hurricanes Katrina and Rita.

The Gulf Opportunity Zone Act affects 11 counties in Alabama, approximately 50 counties in Mississippi and 31 parishes in Louisiana.

The GO Zone incentives also provide opportunities for business owners to invest in recovery and new or expanded operations. What's more, capital is borrowed through tax-exempt financing, and borrowers can take accelerated depreciation in the first year.

The most significant incentives in the GO Zone Act include:

• 50% Bonus Depreciation
  5-Year NOL Carryback
  Tax-exempt Financing
  100% First-Year Equipment Expense Deduction for Small Business
  Special Incentives for Employers
  Expensing of Demolition and Cleanup Charges

According to the Mississippi Business Financing Corporation, which is administering the business portion of the Go Zone program in Mississippi, some 135 businesses have signed up for the program with a total incentive valuation exceeding $5 billion.

The Go Zone legislation also provides incentives for apartment and homes building, but that aspect is administered by the Mississippi Home Corportation. The Go Zone program for housing has had only a limited affect so far on replacing the nearly 6,000 apartment units lost from Katrina. (Click Here for this story)

But of the 135 businesses participation in the Go Zone program, only 39 are located within the three Coastal counties and many are from existing operations that are using the program for rebuilding and are familiar names to Coast residents. GCN has included  a list the businesses participating in the Coastal counties below.

For a complete list statewide: Click Here