The Commissioner of Revenue denied the company’s application to be recognized as a “qualified technology business,” per a county report. Under this designation, as part of the county’s “Technology Zone” program, it would have paid half the rate normal rate for the Business, Professional, Occupational License (BPOL) tax.
“Technology Zone” allows qualifying companies in Arlington’s “high-technology business corridors” to pay $0.18 per $100 of gross receipts for 10 years, as opposed to the $0.36 that many companies pay for a business license.
AED says the program is one of its “most effective tools” to recruit and retain tech companies, and a spokeswoman for the division tells ARLnow that 105 businesses have been approved for this designation since its inception in 2014.
After talking with the tax assessor’s office, AED learned the business was denied because it used a third-party organization, known as a Professional Employer Organization, to manage company payroll. It also learned “several” other businesses had been turned away for the same reason.
To qualify for the tax break, businesses must show, and the Virginia Employment Commission must verify, they increased their full-time employees by at least 25% within the 12 months before applying for the program.
“PEOs report a company’s employees and wages to the VEC under the PEO’s federal employer identification number, and the reports indicate that the employees are affiliated with the PEO rather than with the company,” said the staff report to the Arlington County Board. “This leaves the company unable to demonstrate employment growth to the County via its own VEC filing and therefore unable to meet the Technology Zone program’s criteria.”
This affects between four and six companies interested in applying for the program every year, AED spokeswoman Cara O’Donnell said.
Now, AED and the Commissioner of Revenue are asking the County Board to allow businesses that use these services to be eligible. The Board is set to review the request during its meeting on Saturday.
“The language does not align with current business processes and trends in the technology industry, specifically the increasing usage of third-party organizations to manage and process company payroll,” the staff report says, asserting that this is “inconsistent with the original intent” of the ordinance.
The proposed changes would also update the definition of “qualified technology business,” which the county says is “vague and outdated.”
County code currently says that a “qualified technology business” has a “primary function in the creation, design, and/or research and development of technology hardware or software.”
It adds that using computers, telecommunications services or the internet “shall not, in itself, be sufficient to qualify as a qualified technology business.”
But AED says this “does not capture many new business models” and recommend emphasizing proprietary technology instead.
Lastly, businesses would have 24 months, rather than 18, to apply to be “qualified technology businesses” after setting up a business in Arlington.
“The proposed amendments are minor technical changes to the ordinance language, not expansive policy changes,” the staff report says. “Together, these changes would enhance the effectiveness of the Technology Zone incentive as a business attraction and retention tool.”
Good Friday evening, Arlington. Let’s take a look back at today’s stories and a look forward to tomorrow’s event calendar. 🕗 News recap The following articles were published earlier today…
There’s no official word on its website, but it looks like Bar Ivy in Clarendon may have closed permanently.
There’s persistence, and then there is Audrey Clement and her decade-plus effort to get elected to local office in Arlington. Clement talked with ARLnow editor Scott Brodbeck to talk about…
Makers Union, an upscale gastropub, is set to open its doors in Pentagon City next week, says Alex Brown, the restaurant’s director of operations. This opening marks the third Makers Union location in the D.C. Metropolitan area, following the debut of its Reston location three years ago and a recent opening at the Wharf in early October.
Children’s Weekday Program (CWP) is a non-profit preschool rooted in a play-based philosophy. We focus on developing a love of learning and exploration, cooperation, empathy, and independence.
Our caring and experienced educators create opportunities for children 16 months to 5 years old to play, learn, and grow in a nurturing environment of child-centered and developmentally appropriate experiences.
Initially established more than 50 years ago in South Arlington, CWP continues to be a lauded program in the Northern Virginia area. We are extremely proud to have been recognized as a Best Preschool in Northern Virginia Magazine for the last 4 years.
Located now in North Arlington at 2666 Military Road, CWP offers a part-time parents day out and preschool program with options to extend care both before and after school. We offer a supportive and inclusive school community for children and parents alike and welcome all families to join our school!
The Optimist Club of Arlington is holding its 77th annual Christmas tree sale!
This year, the tree sale will be held at the Knights of Columbus (5115 Little Falls Road). The lot opens for sales on November 24th. The Optimist Club is selling small and large trees ranging from tabletop size to 10 foot tall trees! Wreaths, garland, tree stands, and White House Christmas ornaments will also be for sale.
100% of all proceeds go towards helping Arlington County youth.
For more information, please visit the Arlington Optimists website at https://optimistclubofarlingtonva.org/.
Holiday Art Show featuring artists: Peter Fitzgerald, Claire Plante, Alanna Rivera, and Suzy Scollon. At the Barcroft Community House, 800 South Buchanan St., Arlington, VA. Dec. 8 from, 2 PM to 8 PM and Dec. 9 from 10 AM to
2023 Christmas Tree Sales Begin
Saturday, December 2
Get your holiday decorating off to the right start this year! We will be selling 150 Fraser firs, freshly cut and delivered from Sparta, North Carolina.