Twenty-eight Pennsylvania startups in the Greater Lehigh Valley earned more than $15 million in state tax credits to support new growth, investment and job creation.
The Pennsylvania Department of Community and Economic Development approved $15.09 million through the Keystone Innovation Zone Tax Credit program for 202 companies located within one of the state's 28 Keystone Innovation Zones.
These zones are designated zones that may be established in communities that host institutions of higher education – colleges, universities, and associate degree technical schools, according to the DCED. These zones are designed to boost innovation and create entrepreneurial opportunities. The total number of companies participating and tax credits awarded are the highest totals in the program's history, according to the DCED.
"We are delighted to see that a number of clients of the Ben Franklin Technology Partners of Northeastern Pennsylvania have been awarded Keystone Innovation Zone tax credits," said R. Chadwick Paul, Jr., president and chief executive officer of the Ben Franklin Technology Partners of Northeastern Pennsylvania in Bethlehem. "The credits demonstrate Pennsylvania's confidence in the rigor of our client selection process and the quality of the support we provide. The tax credits will provide much-needed financial assistance to early-stage technology firms that are critical to innovation and high-quality jobs in the Commonwealth's future."
Tax credits provide for the award of up to $25 million annually. To be eligible, companies must be: a for-profit company that operates within the boundaries of a Ben Franklin Technology Development Authority-approved KIZ; less than eight-years-old; and operate within one or more of the target industry sectors including, life-sciences, information technology, advanced manufacturing, business services, defense, energy, agriculture and food processing.
Those companies benefit from the program because they can use the tax credit to offset a Pennsylvania tax liability or sell the tax credit themselves or secure a third-party, independent broker to sell the tax credit on its behalf, said Steven Kratz, spokesman for the Pennsylvania DCED.
The program provides those companies the ability to grow their business and invest in research and development, Kratz said.
"It puts more money back into the hands of entrepreneurs to grow their business by hiring employees, investing in R&D and to make sure the ideas and innovations being developed here stay here," Kratz said.
The credits are awarded based on a company's growth in revenue from a baseline year to the following year, Kratz said. The most recent awards used a baseline year of 2011 and a comparable year of 2012.
Liquid Interactive, one of the recipients, plans to use the tax credits to aid in its hiring efforts.
“We do a lot of digital technology research and development and we have to stay on the edge of the knife to support our big corporate clients,” said James Ludlow, president of Liquid Interactive. “I use the credits to help support hiring high paid technology jobs.”
He explained that the companies earn the credits by growing their business and hiring new people.
Companies applying that meet the criteria are eligible to receive a tax credit up to $100,000 or 50 percent of the company's increase in revenue, whichever amount is less, Kratz said.
The companies and award amounts included:
• J G Sesta LLC of East Stroudsburg -- $100,000;
• RVIBE LLC of Bethlehem -- $100,000;
• Gfree Bio LLC of Doylestown -- $7,032;
• Viddler Inc. of Bethlehem -- $100,000;
• Third Eye Diagnostics Inc. of Bethlehem -- $50,000;
• Building 22 Metalworks LLC of Doylestown -- $81,500;
• Colorfin LLC of Kutztown -- $100,000;
• FiberOptic.com Inc. of Breinigsville -- $100,000;
• Stellar Technology Solutions LLC of Stroudsburg -- $100,000;
• Mosaic Interactive LLC of Bethlehem -- $20,808;
• Microclean Green Technologies Inc. of Bethlehem --$79,981;
• Liquid Interactive of Breinigsville -- $100,000;
• Rhoads Marine Industries Inc. of Doylestown -- $100,000;
• EcoTech Marine International of Bethlehem -- $100,000;
• Advanced Vertebral Solutions LLC of Doylestown --$94,142;
• Lightbox Inc. of Bethlehem -- $100,000;
• DynAccess Ltd. Of Bethlehem -- $6,424;
• ImCare Biotech LLC of Doylestown -- $13,510;
• David Horn LLC of Doylestown -- $100,000;
• Pharmabridge Inc. of Doylestown -- $86,708;
• Inventox Inc. of Doylestown -- $100,000;
• Fox Chase Chemical Diversity Center Inc. of Doylestown -- $60,136;
• Enantigen Therapeutics Inc. of Doylestown -- $100,000;
• JBS Science Inc. of Doylestown -- $99,107;
• Pivitec Inc. of Bethlehem -- $35,491;
• Hager Biosciences LLC of Bethlehem -- $67,796;
• FlowMetric Inc. of Doylestown -- $100,000;
• CryoConcepts LP of Bethlehem -- $89,565.