Tax breaks offered to expanding, new firms in Nevada

The Nevada Commission on Economic Development awarded or offered $1 million in tax incentives to six companies expanding here or considering a move to Nevada in the past two months.

The recipients include an Internet e-commerce company, a producer of TV commercials and a huge producer of office supplies.

Leading the incentives list, at least in the commission's eyes, was a $116,000 incentive awarded to iSwag.com, a company that bills itself as a comprehensive e-commerce provider for the logo products business. iSwag is investing $1.6 million in new equipment in the Las Vegas area; it will receive an $84,000 tax abatement and an additional $32,000 in deferred taxes.

But for the commission, the trade-off was well worth the price -- iSwag plans to increase its workforce from 30 to 80 on Green Valley Parkway, at an average wage of $21.04 per hour. That well exceeds the $14.12 per hour average Nevada wage, which companies must meet or exceed to qualify for incentives.

"The economic impacts were significantly positive, exactly what we like to see," said Bob Shriver, executive director of the commission.

iSwag produces Internet systems that encompass all facets of companies' logo products business. Customers and employees can make purchases of logoed products through an iSwag system, and these orders are then immediately relayed to suppliers, allowing product to be produced on an as-needed basis.

Because of the area's rapid growth, cost of living and relatively low tax burden, "we believe this is going to be the next Silicon Valley," said Jennifer Landaz, manager of marketing at iSwag.

Larger still was a $278,000 incentive awarded to Avery Dennison Corp., one of the nation's largest producers of office supplies with $3.8 billion in sales last year. The Pasadena-based company is eyeing the Las Vegas Valley as a potential site for an 86-employee service center for its U.S. operations.

The center would handle such functions as accounts payable and receivable, payroll, taxes and other financial functions. The average wage would be $15.78 per hour.

The commission offered Avery Dennison a $206,000 tax abatement and $72,000 in additional deferments in an effort to lure the company to Las Vegas. Currently, Avery Dennison is also considering sites in Arizona and Florida for the center. Las Vegas' advantages, according to the company, include the quality of the area's workforce, availability and low cost of real estate, quality of life and low risk of natural disasters.

"They wanted to be assured that if they chose this area, they could count on the incentives as one of the reasons," Shriver said. "We should know something (on where Avery Dennison will locate the center) within the next 60 to 90 days."

Also presented with a possible tax break as an enticement was QEP Inc. of Boca Raton, Fla., which is looking at Henderson as a potential site for a 120,000-square-foot manufacturing and distribution facility that would employ 65. The commission offered the company $52,500 in tax abatements and an additional $20,000 in tax deferrals.

QEP manufactures and sells tools and equipment for the floor covering industry. At an average wage of $14.15 per hour, its jobs pay only pennies above the average state wage -- and, historically, the commission has been less willing to grant incentives to companies locating to Nevada's thriving urban areas unless the wages were significantly above that mark.

But the commission also had competition on its mind -- QEP is also considering placing the plant in Goodyear, Ariz.

"They have not totally committed to Henderson yet, but we're pretty confident this will swing the deal," Shriver said. "The reason this was a little different is that they have not yet committed to the community, so this was an inducement to get the business here.

"If they don't meet the (wage) requirements, they would be required to pay back the tax (incentives) with a penalty."

Also receiving an incentive was Las Vegas-based Century Advertising Production Inc., which operates a television production and post-production facility that employs 24. The company received an abatement of $63,220 and deferrals of $24,000 on $1.2 million in new equipment.

Century Advertising plans to add another eight jobs to its workforce, pushing employment to 32. These jobs will pay an average wage of $20.65.

"This fits nicely into our goal of expanding our post-production capabilities for the television industry," Shriver said. "We see the Las Vegas area as really a natural extension of Hollywood. It's paying off, and we're happy to provide (tax incentives) for them."

One Las Vegas-area application, made by Advance Polybag of New Orleans, was partially denied by the commission because it failed to meet the minimum wage requirements needed to receive incentives.

The commission denied a $518,000 abatement request made by Advance Polybag for a plant it's opening in North Las Vegas. Although the company is hiring 84 employees and investing $9.8 million in new equipment, its $12.74 per hour average wage fell below the state's average.

Since wages must only be 80 percent of the state's average for deferrals, the commission did grant a request for $198,000 in tax deferrals. The plant will produce a variety of logoed plastic bags, and will also have plastic bag recycling operations.

The largest incentive awarded in recent months was a $339,000 tax abatement granted to Quebecor Printing Nevada Inc., a subsidiary of the world's second-largest printing company. The abatement, to be taken over 10 years, was awarded for a $12.6 million investment made in the Northern Nevada town of Fernley.

Quebecor already employs 127 in Fernley, but requested the incentive for a planned expansion that will add two printing presses and 75 new jobs. The average wage of the 75 jobs will be $16.54.

The incentive reflects a 50 percent abatement in property taxes on the new equipment over a 10-year period.

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