By Amanda M. Mills, CPA, Tax Senior Manager
Updated thresholds for VA Enterprise Zone Grants beginning July 2025
Governor Glenn Youngkin recently signed a bill that amends Virginia’s enterprise zone real property investment grants program effective July 1, 2025. The most significant change creates an elevated grant tier for a major qualified zone investor which is a qualified zone investor making qualified real property investment (QRPI) in excess of $20 million. The elevated grant tier allows such investor to calculate its grant at 25% of the amount of QRPI exceeding $500,000 for the construction of a new building or facility, and 25% of the amount of QRPI exceeding $100,000 for the rehabilitation or expansion of an existing building or facility. In addition, a real property investment grant to a major qualified zone investor is capped at $300,000 within a five-year period for any individual or facility.
Under previous law and prior to July 1, 2025, a major qualified zone investor was not defined and an investor with more than $20 million of qualifying costs would compute its grant based on 20% of QRPI exceeding the applicable threshold with a maximum grant of $200,000 available within a five consecutive-year period. On or after July 1, 2025, a qualified zone investor who does not qualify as a major qualified zone investor remains subject to the original investment thresholds, grant cap, and grant calculation as previously featured.
Additional program enhancements
Another notable provision included in the bill expands real property to include a child day center defined as a child day program offered to (i) two or more children under the age of 13 in a facility that is not the residence of the provider or of any of the children in care or (ii) 13 or more children at any location.
The bill also instructs the Department of Housing and Community Development to partner with the Virginia Economic Development Partnership Authority to review the utilization of currently designated enterprise zones, make recommendations on renewals or termination of such zones, and report its findings by November 1, 2025.
About the Author
Amanda M. Mills, CPA, Tax Senior Manager
Amanda provides tax services to construction, specialty contractors, real estate development, and service businesses and their owners. Her responsibilities include income tax compliance, tax planning and consulting, and tax and accounting research. She is a member of Keiter’s Real Estate and Construction Industry team.
More Insights from Amanda M. MillsThe information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.
