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CAEZ Meeting Update Part 2

CAEZ also had the benefit of again hearing from Toni Symonds, Chief Consultant, Assembly committee on Jobs, Economic Development and the Economy.  Toni raised the concern that one of the proposals in the Democratic Conference Committee is a three year suspension of Net Operating Loss carryforwards.  Since the last time the NOL was suspended in 2002-2003 Enterprise Zones were not exempted, there is a concern that this year’s proposal would do the same.

The small business community is understandably concerned about this and have floated a proposal to exempt companies with under $5 million in revenue.  Here is the press release from Small Business California.

There seems to be some openness to consider such a compromise.  An alternative compromise that CAEZ may propose would be an exemption for Enterprise Zone businesses thus preserving the strength of the incentive.  It is important to keep in mind that three years is a full 20% of an Enterprise Zone’s designation.

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