                                 CODE OF VIRGINIA

ENTERPRISE ZONE REAL PROPERTY INVESTMENT GRANTS (§ 59.1-548)

A. As used in this section:
			&#8220;Facility&#8221; means a complex of buildings, co-located at a single
physical location within an enterprise zone, all of which are necessary to
facilitate the conduct of the same trade or business. This definition applies to
new construction as well as to the rehabilitation and expansion of existing
structures.
			&#8220;Major qualified zone investor&#8221; means a qualified zone investor
making qualified real property investments in excess of $20 million.
			&#8220;Mixed use&#8221; means a building incorporating residential uses in
which a minimum of 30 percent of the useable floor space will be devoted to
commercial, office, or industrial use.
			&#8220;Qualified real property investment&#8221; means the amount expended
for improvements to rehabilitate, expand, or construct depreciable real property
placed in service during the calendar year within an enterprise zone provided
that the total amount of such improvements equals or exceeds (i) $100,000 with
respect to a single building or a facility in the case of rehabilitation or
expansion or (ii) $500,000 with respect to a single building or a facility in
the case of new construction. Such real property may include a child day center
as such term is defined in § 22.1-289.02.
			&#8220;Qualified real property investment&#8221; includes any such
expenditure regardless of whether it is considered properly chargeable to a
capital account or deductible as a business expense under federal Treasury
Regulations.
			&#8220;Qualified real property investment&#8221; includes expenditures
associated with (a) any exterior, interior, structural, mechanical, or
electrical improvements necessary to construct, expand, or rehabilitate a
building for commercial, industrial, or mixed use; (b) excavations; (c) grading
and paving; (d) installing driveways; and (e) landscaping or land improvements.
&#8220;Qualified real property investment&#8221; includes, but is not limited
to, costs associated with demolition, carpentry, sheetrock, plaster, painting,
ceilings, fixtures, doors, windows, fire suppression systems, roofing, flashing,
exterior repair, cleaning, and cleanup.
			&#8220;Qualified real property investment&#8221; does not include:

   1. The cost of acquiring any real property or building.

   2. Other costs including: (i) the cost of furnishings; (ii) any expenditure
   associated with appraisal, architectural, engineering, surveying, and interior
   design fees; (iii) loan fees, points, or capitalized interest; (iv) legal,
   accounting, realtor, sales and marketing, or other professional fees; (v)
   closing costs, permits, user fees, zoning fees, impact fees, and inspection
   fees; (vi) bids, insurance, signage, utilities, bonding, copying, rent loss,
   or temporary facilities incurred during construction; (vii) utility connection
   or access fees; (viii) outbuildings; (ix) the cost of any well or septic or
   sewer system; and (x) roads.

   3. The basis of any property: (i) for which a grant under this section was
   previously provided; (ii) for which a tax credit under &#xA7; 59.1-280.1 was
   previously granted; (iii) which was previously placed in service in Virginia
   by the qualified zone investor, a related party as defined by Internal Revenue
   Code &#xA7; 267 (b), or a trade or business under common control as defined by
   Internal Revenue Code &#xA7; 52 (b); or (iv) which was previously in service
   in Virginia and has a basis in the hands of the person acquiring it,
   determined in whole or in part by reference to the basis of such property in
   the hands of the person from whom it was acquired or Internal Revenue Code
   &#xA7; 1014 (a).
   				&#8220;Qualified zone investor&#8221; means an owner or tenant of real
   property located within an enterprise zone who expands, rehabilitates, or
   constructs such real property for commercial, industrial, or mixed use. In the
   case of a tenant, the amounts of qualified zone investment specified in this
   section shall relate to the proportion of the building or facility for which
   the tenant holds a valid lease. In the case of an owner of an individual unit
   within a horizontal property regime, the amounts of qualified zone investments
   specified in this section shall relate to that proportion of the building for
   which the owner holds title and not to common elements.

B. 1.  Grants shall be calculated at a rate of 20 percent of the amount of
qualified real property investment in excess of $500,000 in the case of the
construction of a new building or facility.
			Grants shall be calculated at a rate of 20 percent of the amount of qualified
real property investment in excess of $100,000 in the case of the rehabilitation
or expansion of an existing building or facility.
			For any qualified zone investor making $5 million or less in qualified real
property investment, a real property investment grant shall not exceed $100,000
within any five-year period for any individual building or facility. For any
qualified zone investor making more than $5 million, but not more than $20
million in qualified real property investment, a real property investment grant
shall not exceed $200,000 within any five-year period for any individual
building or facility.

   2. On and after July 1, 2025, grants to major qualified zone investors shall
   be calculated at a rate of 25 percent of the amount of qualified real property
   investment in excess of $500,000 in the case of the construction of a new
   building or facility.
   				On and after July 1, 2025, grants to major qualified zone investors shall
   be calculated at a rate of 25 percent of the amount of qualified real property
   investment in excess of $100,000 in the case of the rehabilitation or
   expansion of an existing building or facility.
   				A real property investment grant to a major qualified zone investor shall
   not exceed $300,000 within any five-year period for any individual building or
   facility.

C. A qualified zone investor shall apply for a real property investment grant in
the calendar year following the year in which the property was placed in
service.

HISTORY: 2005, cc. 863, 884; 2007, cc. 242, 287; 2009, cc. 207, 271; 2017, c.
451; 2025, c. 250.