SALEM — Town officials hope the creation of a new economic revitalization zone off Interstate 93 will attract businesses and create jobs.
Selectmen voted unanimously Monday to create the zone at the request of Community Development Director William Scott, hoping it will help boost economic development near Exit 2.
Companies that decide to relocate to the area would receive tax credits that could be used to invest in their businesses, Scott said.
“Taxes that would ordinarily go to the state go back into the business for redevelopment,” he said.
New businesses or those wishing to expand are eligible to receive up to $200,000 in tax credits over five years, according to Gary Chabot, a business resource specialist with the New Hampshire Division of Economic Development.
The zone, or ERZ as it’s called, includes part of Keewaydin Drive, Commercial Drive, and Pelham and Stiles Roads, Scott said.
Creation of these zones helps to expand a community’s commercial and industrial tax base, generating tax revenue, he said.
“What the town gets out of it — and, obviously, the company — is tax revenue, job creation and reduction of vacancies,” he said.
Work being done at Exit 2 as part of the I-93 widening project is key to the town’s decision to want to attract businesses, Scott said.
“One of the reasons we want to do this is because of the traffic improvements,” he said.
The credits, offered against the state’s business enterprise and businesses profits taxes, are capped at $40,000 per year, Chabot said.
But there’s a catch.
“You have to create jobs to get the credits,” Chabot said.
More than 50 communities across the state have opted to create economic revitalization zones to boost business, Chabot said.
There are approximately 115 in the state and 10 in Southern New Hampshire, including Derry, Londonderry and Plaistow.
Many communities, including Salem, have several, Chabot said.
Salem’s four zones include Northeastern Boulevard, The Mall at Rockingham Park, the Depot area and Keewaydin Drive Extension.
Scott said the town will be working with the Greater Salem Chamber of Commerce to let companies know how they can benefit.
Chamber executive director Donna Morris said her organization fully supports the economic development initiative.
“ERZs are a great idea to provide incentives for growth,” she said. “This is great news.”
Selectman James Keller, also a Planning Board member, said the new zone will help attract business and boost the economy.
Companies will consider moving to Salem because of the tax incentives, he said.
“It’s beneficial to the state, the companies and the town,” he said.