Bethlehem Companies Benefit From KIZ Tax Credits, Grants
By Colin McEvoy on March 11, 2016
Bethlehem startups and small companies continue to benefit from the Southside Bethlehem Keystone Innovation Zone (KIZ), a designated zone within the city designed to foster entrepreneurial growth.
Seven Bethlehem companies within the zone have received $403,016 from the KIZ tax credit program, which is designed to help early-stage businesses cover capital expenditures, workforce expansion, and operational expenses.
“The amazing thing about this program is that a single company can receive up to $800,000 over an eight-year period, just for being located in the KIZ,” said Asher Schiavone, Bethlehem economic development coordinator.
“Most companies will sell these tax credits for about 91 cents on the dollar,” he said. “I have yet to find an entrepreneur that wouldn’t be interested in securing an extra $730,000 in cash for their business.”The Bethlehem companies to receive KIZ tax credits include:
- Hager Biosciences LLC ($100,000)
- ViiHealth, Inc. ($100,000)
- H.B. Custom Media, Inc. ($49,668)
- Innovform Therapeutics LLC ($44,509)
- Pivitec LLC ($43,818)
- Map Decisions LLC ($39,191)
- DynAccess ($25,830)
“The KIZ and the tax credits program are an important in the realization of our strategy as an early-stage company,” said Sunny Verma, founder and president of ViiHealth, a cloud-based web service that lets consumers manage their personal healthcare information. “We greatly appreciate all the help and support from the Southside Bethlehem KIZ.”
In total, the $5 million in KIZ tax credits have been awarded to Bethlehem companies since 2004, according to Asher Schiavone, Bethlehem economic development coordinator. The Southside Bethlehem KIZ is administered by the Bethlehem Economic Development Corporation.
Additionally, the KIZ board, which includes representatives from the Lehigh Valley Economic Development Corporation (LVEDC), this month approved a $15,000 technology transfer grant to Architrep, the company behind Kitrex, the three-dimensional origami dinosaur kits.
Technology transfer grants help support KIZ companies seeking to market and commercialize a product or service, Schiavone said.
This particular grant will help Architrep create two new dinosaurs – a tyrannosaurus rex and a stegosaurus – and manufacture the kits using cardboard instead of paperboard, which will allow for them to be created in small run sizes, according to company founder Lisa Glover.
“This grant is definitely going to be helpful for what I’m looking to do,” Glover said. “Stores are looking to take on not just a single product, but a product line. In the past it’s been really difficult to secure funding to produce more than one dinosaur, but this new type of manufacturing will allow me to do smaller run sizes, at a smaller cost as well.”
Kitrex has already previously produced velociraptor and pterodactyl kits, and Glover recently launched her third Kickstarter campaign, this time for a Triceratops kit. The campaign launched March 8, and within three days had already raised more than $5,800 toward its $12,000 goal.
“We are definitely excited to invest in the success of Architrep and their flagship product line KitRex,” Schiavone said. “This grant will further assist Lisa in diversifying the herd and strategically position her company for growth.”
The $403,016 in KIZ tax credits were announced last month by the Pennsylvania Department of Community and Economic Development (DCED), part of nearly $18 million in tax credits that support 239 early-stage companies throughout the state.
“The KIZ program is an important tool that substantially contributes to the ability of young companies to transition through the stages of growth,” said DCED Secretary Dennis Davin. “We need to nurture the talent pipeline that exists in Pennsylvania from higher education to business ownership by providing as many opportunities as possible to support their efforts.”
KIZ companies are eligible for tax credits if they have been in operation for less than eight years, with gross revenues having increased over the previous year, and are operating within a targeted industry sector such as information technology or advanced manufacturing/diversified materials.
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