Pledging to advocate for strengthened support of small manufacturers, Governor Gina M. Raimondo visited Cranston-based Dean Machine today to outline her proposed Manufacturing Initiative.
"In the past three years, we have worked to bring Rhode Island's manufacturing industry into the 21st century and creating more jobs in manufacturing," Raimondo said. "Manufacturing jobs offer Rhode Islanders good salaries, opportunity for advancement, and the pride that comes with making a living by making things. Last year, the General Assembly passed part of my manufacturing package. Today, I'm calling on the legislature to pass the rest of this package – so we can ensure smaller manufacturers are included in Rhode Island's economic comeback."
The Raimondo' administration's proposed FY19 Manufacturing Initiative, which the Governor announced yesterday during the 2018 State of the State, is designed to help Rhode Island manufacturers grown and create jobs by making it easier for them to access the Qualified Job Tax Incentive and Rebuild RI tax incentives. It also expands their access to the Real Jobs RI program and provides greater resources to the Polaris Manufacturing Extension Partnership, which helps manufacturers grow, increase efficiency, and purchase new equipment.
"Manufacturing has played a key role in our state's economy for centuries and, given the right policies and partnerships, will continue to do so well into the future," said Rhode Island Commerce Secretary Stefan Pryor. "With targeted investments in the industry and expanded access to our state's economic development programs, Rhode Island can again be at the forefront of manufacturing innovation."
Governor Raimondo's FY19 Manufacturing Initiative Package Includes:
• Manufacturing Investment Tax Credit Companies are eligible for a tax credit of 4% or 10% on qualifying investments in equipment and training. Manufacturers can use the 4% credit against business corporation taxes for property used in the production of goods by manufacturing, processing, or assembling. Manufacturers considered "high performance businesses" may be eligible for the 10% credit against business corporation taxes for similar investments upon meeting additional criteria.
The following changes for Rhode Island manufacturers are proposed to the existing legislation:
1) Make the value of the tax credit refundable up to a capped amount.
2) Allow the credit to be claimed by non-C-Corps;
• Manufacturing Site Readiness This bill would create the fund for the Manufacturing Site Readiness program. The program would develop an inventory of vetted, pad-ready sites in Rhode Island capable of supporting large-scale manufacturing and distribution facilities. This program would promote investment in infrastructure and advance pre-permitting, it will be used to help showcase the State's potential for new industrial growth.
• Expand Qualified Jobs Tax Incentive for manufacturers Amend the Qualified Jobs Incentive Tax Credit to lower the required job-creation threshold for manufacturers of all corporate structures who increase their Rhode Island-based workforce by at least 10 percent, encouraging hiring in the manufacturing industry. The current minimum number of new jobs for eligibility is typically 20 for a manufacturing business.
• Expand Rebuild Rhode Island Program to more Manufacturers Amend the Rebuild Rhode Island tax credit program to make the incentive more valuable for manufacturers—and particularly small manufacturers. Under the proposed changes, manufacturers would be exempted from the requirements that a project must be at least 25,000 sq. ft., employ at least 25 full-time employees, and involve a project cost of not less than $5,000,000. These changes will enable more small manufacturers to use the program to invest in and grow their businesses.
• Expand Access to Real Jobs Rhode Island Program for Small Manufacturers The Department of Labor and Training will expand access for small manufacturers in the Real Jobs RI program by providing $2,000,000 in program funding to be made available to manufacturers across Rhode Island. Currently many available incentives are in the form of tax credits and are limited to businesses structured as C-Corps, leaving smaller manufacturers behind. The Real Jobs program enables access to the training funds and opportunities provided by the program for all businesses, including small manufacturers.
• Increase funding for Polaris Manufacturing Extension Partnership Increasing funding to Polaris by $100,000 therefore providing Rhode Island's manufacturers with additional resources. Polaris deploys technical experts to help manufacturers optimize their businesses. Polaris provides group and individual trainings for operators, shares expertise, and promotes manufacturing state-wide.
In May 2017, The Boyd Company, a New Jersey-based location consultant for manufacturers, named Rhode Island as one of the most competitive locations in the Northeast to build a new advanced manufacturing facility. Creating an inventory of sites that can support these types of projects will make it even easier to do so. Enhancing access to incentives for manufacturers will help even further.
Last year, the General Assembly passed part of Governor Raimondo's Manufacturing Package including $3.65 million in additional funding for Davies Career and Technical High School and changes to the Innovation Voucher program to enable manufacturers to contract in-house R&D.