KEYSTONE OPPORTUNITY ZONE

Lackawanna County offers numerous buildings and land sites designated as Keystone Opportunity Zones (KOZ) and Keystone Opportunity Expansion Zones (KOEZ).

Keystone Opportunity Zones are defined to parcel-specific areas with no or greatly reduced tax burden for property owners and/or lessees.

KOZ’s have been designated by local communities and approved by the Commonwealth of Pennsylvania. They are partnerships between state and local taxing bodies, school districts and economic development agencies.

Tenants of KOZ properties may be exempt from the following taxes until 2010 or 2013, depending upon the specific designation:

Local property taxes
Pennsylvania Corporate Net Income Tax
Pennsylvania Capital Stock and Franchise Tax
Sales Tax on certain construction materials, fixtures and equipment
Insurance Premiums Tax

The Scranton Plan has commissioned a Big 4 accounting firm to estimate the tax savings companies will realize should they locate their operation within a KOZ zone. Various scenarios were presented to the agency to provide estimated tax savings. The Scranton Plan, in the chart below has illustrated an annual savings for the various scenarios.

SCENARIO	ESTIMATED ANNUAL KOZ SAVINGS
Retail Distribution Center 1 million sq. ft.- 500 employees	$.55 to $1.14 million
Insurance Company Claims Office/Financial Center 100,000 sq. ft.- 300 employees	$.69 to $1.18 million
Plastics Company Laminated Plastics Manufacturing 200,000 sq. ft.- 300 employees	$.14 to $.3 million
Electronics Company Consumer Electronics Manufacturing 200,000 sq. ft.- 300 employees	$.42 to $.58 million
Metal Fabrication Company Industrial Metal Products Manufacturing 100,000 sq. ft.- 150 employees	$.07 to $.15 million
Pharmaceutical Company Pill Manufacturing and Distribution 200,000 sq. ft.- 500 employees	$2.0 to $2.4 million
* Figures indicate yearly tax savings.

To search Lackawanna County's KOZ and KOEZ sites click here.

For more information regarding the KOZ program click here.