Patterson Irrigator

November 21, 2008 Patterson, CA

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Tax breaks going unclaimed

Written by John Saiz / Patterson Irrigator /

Saturday, 17 November 2007

Businesses in special zone eligible for state credits

Businesses in Patterson’s enterprise zone could qualify for huge tax savings, though many that qualify are not taking advantage.

Any business in the zone is theoretically eligible for tax credits on new hires and new equipment purchases. Several Patterson businesses are using the program, but many eligible companies have not.

To drum up participants, employees from the Alliance — an economic development agency that works on behalf of Stanislaus County and its cities — was in Patterson on Thursday talking about the zone.

“Whether it’s a small business or a large business, they don’t realize the benefits they have,” said Doug Sweetland, the Alliance’s director of economic development.

Attendance at the meeting reflected how few eligible business are capitalizing on the program. Only three people showed up.

Meetings in the county’s other cities had similar turnouts, Sweetland said. The next major step for the Alliance, he said, is to try to make businesses more aware of the zone.

He said other counties have seen their programs grow significantly after about three years once word of mouth starts spreading. Patterson’s enterprise zone celebrated its two-year anniversary Friday.

Patterson’s zone now includes the Keystone Pacific Business Park, the Villa Del Lago commercial center near Interstate 5, retail areas at Ward and Sperry avenues, Patterson Vegetable Co. and industrial land at the east end of Sperry Avenue.

Pi Graphic

The city’s downtown is excluded from the zone, but the Alliance and city staff hope that will change by February. On Oct. 2, the Patterson City Council approved starting a process that would expand the zone. If that happens, downtown, as well as most of the businesses along Highway 33, will be included in the zone.

The city’s Economic Strategic Committee also recommended to the council Thursday that the zone be extended south of Sperry Avenue in western Patterson, as well as to the Patterson Airport just north of Sperry Avenue and to Highway 33 and Ward Avenue, where there are several medical offices.

Businesses inside the zone could receive a tax voucher of as much as $35,100 over five years for a new hire or receive a sales-tax credit on many items bought for the business. Patterson Vegetable Co. and the Longs Drugs distribution center are two of the larger companies taking advantage of Patterson’s zone, Sweetland said.

The Alliance, however, can track only hiring vouchers, and Sweetland said he does not know how much sales-tax savings area companies have seen. To get a better understanding of how and if companies are using the zone, the Alliance will send a survey to many businesses in the county.

An Alliance representative said there are 2,500 vouchered employees in the county.

The three businesspeople at Thursday’s meeting appeared interested in using the tax breaks.

“I’d be foolish not to,” said Arnold Regalado, franchise owner of Patterson’s McDonald’s restaurant.

Attendees expressed concerns about the amount of paperwork it takes to prove that a new employee qualifies for the program. To be eligible, an employee must meet at least one of 13 criteria.

Most criteria are based on making less than a certain amount of money or qualifying for certain types of government assistance. Other criteria include being an American Indian, an ex-offender or living in certain low-income neighborhoods.

Though the process can appear daunting, Sweetland assured attendees that the Alliance can make the process smooth.

“We’ll come out to your business,” he said. “We’ll walk you through it.”

The Alliance plans to be back in Patterson to promote the zone Dec. 13.

To reach John Saiz at the Irrigator, call 892-6187 or e-mail him at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

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