The City of San Diego offers business incentives that are aligned with City Council Policy 900-12 , giving companies an edge in the marketplace and helping them expand and prosper. Check out this video on how the City's Economic Development Department and industry incentives helped a local brewery expand.
The Business & Industry Incentive Program serves as the City's primary economic development policy.
A business is eligible for financial incentives if it meets at least one of the following criteria:
- provides significant revenues and/or jobs;
- promotes the stability and growth of City taxes and other revenue;
- constructs appropriate development in older parts of the City; or
- is being induced by other jurisdictions to relocate from San Diego.
The City can help with project advocacy, due diligence and streamlined-ministerial and discretionary-permit review processes. Financial incentives can include reimbursement of all or a portion of building and/or development-related fees.
The City's Economic Development Department has a proactive Business Expansion, Attraction and Retention (BEAR) team that works directly with key businesses in targeted industries. It provides assistance and actively promotes incentives to businesses and other economic development stakeholders in our region, resulting in the creation and retention of jobs in San Diego. Several business incentive programs are available locally and statewide to assist companies in the San Diego region.
To see if your business might qualify for some of these incentives, please contact Kevin Sullivan of the City's Economic Development Department at 619-533-5954 or [email protected].
New Employment Credit
The State of California's New Employment Credit (NEC) allows San Diego businesses an opportunity to capture valuable tax credits intended to leverage against their annual state income tax liability. In part, the NEC allows qualifying companies to capture up to $56,000 in tax credits (per qualified employee) for hiring individuals in traditionally difficult to employ categories, such as recently discharged veterans, ex-offenders, long-term unemployed, and public assistance recipients.
For more information regarding employer and employee eligibility requirements for the state’s New Employment tax credit program, please visit the California Franchise Tax Board - New Employment Credit Frequently Asked Questions.
Please click on the following link (New Employment Credit Estimator) if you would like to find out if your business may be eligible for state tax credits based on full-time employees hired after Jan. 1, 2014.
California Competes Tax Credit Program
This flexible tax credit program promotes job creation and business attraction, expansion and retention efforts in California. The program goal is to incentivize companies that plan to move to California or that wish to expand their existing business operations in the state. Companies statewide submit online applications for the opportunity to capture significant quarterly allocations of state tax credits. The program is administered by California Governor's Office of Business and Economic Development (GO-Biz).
For more information, please visit the California Competes Tax Credit Program.
Partial Sales Tax Exemption Program
The Partial Sales Tax Exemption Program affords businesses a 4.19 percent state sales tax exemption for qualifying manufacturing equipment purchases statewide, resulting in an immediate, direct cost benefit for company at the purchase time of qualifying equipment. The program is administered by the California Board of Equalization (BOE).
For more information regarding qualifying equipment and eligibility requirements for this tax exemption, please visit the state of California Board of Equalization - Manufacturing and Research & Development Exemption Program.
Certain San Diego businesses may be eligible to receive expedited plan check services involving building permit processing such as tenant improvements.
Business Cooperation Program (BCP)
The City's BCP can reduce the cost of doing business in San Diego by preventing the annual loss of millions of dollars in sales and use tax revenue due to misallocation. Financial incentives available through the BCP encourage businesses with significant equipment expenditures to take part in the program to support proper allocation of sales and use taxes to the City. The BCP can provide a tax rebate of up to 50 percent of the local 1-percent sales or use tax paid in connection with San Diego-based operations.
The City of San Diego ensures its business climate is attractive for both existing businesses and those interested in relocating to San Diego.
Additionally, the City cultivates an open dialogue and partnership with private nonprofit organizations, trade associations and other institutions, including the San Diego Regional Economic Development Corp. and the San Diego Regional Chamber of Commerce to maintain a business-friendly environment.