Rural Jump-Start Program

The Rural Jump-Start Program is a collaborative effort by the state, local governments, Institutes of Higher Education (IHE), and economic development organizations (EDO) to incentivize new businesses to start in or move to rural, economically distressed counties in Colorado, which are referred to as Rural Jump-Start zones, and hire new employees. 

Rural Jump-Start began in 2016 as a tax incentive program, and in 2021 a grant program was created, for businesses located in a Rural Jump-Start zone. To be eligible, businesses cannot be operating in the State of Colorado at the time of application and cannot compete with similar businesses in the county where they are locating or an adjacent economically distressed county. If you are a business interested in participating in this program, please review all program qualifications, discussed in greater detail under the below, before applying. 

Grant benefits are dependent on the business' location:

  • If a business is located in a Rural-Jump Start zone, businesses can receive a matching grant of up to $20,000 as a newly established business and up to $2,500 per New Hire.
  • If a business is located in a Rural-Jump Start zone that is also a Tier 1 Just Transition community, businesses can receive a matching grant of up to $40,000 as a newly established business and up to $5,000 per New Hire.

Tax benefits include relief from:

  • State income tax for the new business;
  • State sales and use tax for the new business;
  • County personal property tax for the new business;
  • Municipal personal property tax for the new business (in participating municipalities); and
  • State income tax for qualified New Hires.

The Rural Jump-Start Program will accept applications for the tax benefits through December 31, 2025 and for the grant benefits through June 30, 2024. 

 

Overview

Type: Grant and tax credit

For: Businesses located in Rural Jump-Start zones located in economically distressed, rural counties

Amount: Tax relief plus grants up to $40,000 per new business, up to $5,000 per New Hire

Application deadline: Rolling

OEDIT division: Business Funding and Incentives

Review the Rural Jump-Start Statute, (PDF).

Below is an overview of the four main steps a county/municipality must go through to become designated as a Rural Jump-Start zone. 

Step 1: Receive designation as an economically distressed, rural county by the Colorado Economic Development Commission (EDC)

Step 2: Engage with a Sponsoring Entity

Step 3: Pass County and Municipality Tax Relief Resolutions

Step 4: Apply in Salesforce to Become a Rural Jump-Start Zone

Details for each of the four steps are explained in more depth below.

Step 1: Receive designation as an economically distressed, rural county by the Colorado Economic Development Commission (EDC)

An area will qualify as a Rural Jump-Start zone based on population and economically distressed measures, as explained below.

Population

The area needs to be in a county with a population of fewer than 250,000 people.

Economic distress measures

Rural Jump-Start zones MUST meet at least three of these requirements:

  • Per capita income is at least 20% below the state average;
  • County-wide personal income is at least 20% below the state average;
  • Average unemployment level during the last five years is at least 20% above the state average;
  • During the past 5 to 10 years, the area lost population in the workforce age range;
  • Percent of students eligible for free school lunch is higher than the state average;
  • Designated as an Enhanced Rural Enterprise Zone; or
  • Be in a metropolitan statistical area as defined by the U.S. Census Bureau.

The EDC can approve an unlimited number of Rural Jump-Start zones. Each municipality can contain only one Rural Jump-Start zone. A zone may not be larger than a county. Once the EDC approves a Rural Jump-Start zone, the zone will exist until the county loses its economically distressed status.

Map of Rural Jump Start Zones and Counties that qualify for the program
Current Rural Jump-Start Zones/Counties

These counties are currently rural jump-start zones: Alamosa, Archuleta, Clear Creek, Delta, Dolores, Fremont, Garfield, Huerfano, Las Animas, Lincoln, Logan, Mesa, Moffat, Montezuma, Montrose, Otero, Phillips, Prowers, Pueblo, Rio Blanco, Rio Grande, Routt, San Juan, and Sedgwick

These counties are designated as economically distressed and are eligible to be Rural Jump-Start zones, but they have not yet applied to the program: Baca, Bent, Cheyenne, Conejos, Costilla, Crowley, Custer, Hinsdale, Jackson, Kiowa, Kit Carson, Lake, Mineral, Morgan, Saguache, Washington, and Yuma.

Tier 1 Just Transition Communities

Tier 1 Just Transition communities are diversifying away from coal-dependent economic development strategies and receive double the relief as regular Rural Jump-Start Zones. Tier 1 Just Transition communities include Moffat, western Montrose, Morgan, Pueblo, Rio Blanco, and Routt.

Step 2: Engage with a Sponsoring Entity

Counties and municipalities will need to work with a sponsor entity to establish a Rural Jump-Start zone. Sponsoring entities are either:

  • An approved economic development organization; or
  • A designated institute of higher education.
These economic development offices have been approved:
  • Kiowa County Economic Development Foundation (KCEDF)
  • Logan County Economic Development Organization
  • Lincoln County Economic Development Organization
  • City of Craig Economic Development
  • Community Economic Development of Sedgwick County
  • Morgan County Economic Development
  • Phillips County Economic Development
  • Region 9 Economic Development District of Southwest Colorado
  • Routt County Economic Development Partnership
  • San Luis Valley Development Resources Group
  • Steamboat Springs Chamber Resort Association

A Designated Institute of Higher Education (DIHE) can also lead the Rural Jump-Start zone application. Only a public school may serve as a DIHE. A private higher education institution may participate as a partner, but not lead an application.

To use this map, type in your address and it will direct you to the closest Designated Institute of Higher Education.

 

Eligible organizations may apply to be a sponsor entity before or while forming a Rural Jump-Start zone through the OEDIT Salesforce portal. Log in or create a new account. New users are manually added to the portal for security reasons, so it may take several days to activate your account.

Application Materials

In the application, the entity needs to prove that it:

  • Intends to actively execute in its role in the rural jump-start zone;
  • Has the resources to manage the program; and
  • Has designated a point person to work with businesses and our office.

Every entity must:

  • Maintain a strategic plan for the Rural Jump-Start zone;
  • Adopt a conflict of interest policy and keep a written record of all conflict of interest disclosures; and
  • Provide disclosures for the last calendar year to the Colorado Economic Development Commission (EDC) by January 31 of each year.

The conflict of interest policy needs to state that:

  • A representative of the entity may not use the relationship between the entity and the business for the representative’s private benefit;
  • A person who sells goods or services to the entity, an employee of such person, or a person with a business interest in such person’s business shall not vote on or participate on behalf of the entity in any transaction with such business; and
  • If a representative of the entity is aware of any actual or potential conflict of interest, he or she shall advise the chief academic officers or executive director of the entity of the conflict.
Review process

After the sponsoring entity submits its application, the EDC will review it at the next meeting, which is held on the third Thursday of every month. The EDC will approve, deny, or defer the application. The sponsor entity will be notified of the decision.

Step 3: Pass County and Municipality Tax Relief Resolutions

Counties and participating municipalities need to pass tax relief resolutions to become a Rural Jump-Start zone. The resolution needs to state that the jurisdiction will not impose a business personal property tax on new businesses in the program. Partial relief from business personal property tax does not qualify. The jurisdiction needs to offer tax relief for up to eight years for each business.

Jurisdictions may also adopt resolutions with incentive payments and other tax relief including credits, exemptions, and refunds.

Specifics for Municipalities

If a county participates in the program, municipalities are not automatically enrolled. A county or sponsoring entity cannot force a municipality to participate in the Rural Jump-Start Program.

To be eligible for the Rural Jump-Start Program, a municipality must:

  • Be located in a rural, economically distressed county as designated by the EDC (the municipality itself does not need the designation);
  • Be located in a county that passed a Rural Jump-Start tax relief resolution that the EDC has approved;
  • Work with a sponsoring entity, which leads the application; and
  • Pass a resolution to participate in the program and waive the municipal business personal property tax for Rural Jump-Start participants.

Unlike counties, municipalities may limit resolutions to specific businesses. Municipalities may restrict resolutions to certain geographic areas of the municipality.

Step 4: Apply in Salesforce to Become a Rural Jump-Start Zone

After the county and participating municipalities pass resolutions, the sponsoring entity can apply for Rural Jump-Start zone designation. A sponsoring entity must lead and submit the application online in the OEDIT Salesforce portal. The sponsoring entity can submit an application at any time. Before applying, the sponsoring entity should know the boundaries of the zone, the participating municipalities, and any other relevant aspects of the zone.

The sponsor entity must include the following materials in the application:

  • List of all jurisdictions that have passed or are expected to pass tax relief resolutions;
  • Copies of the county and municipality(ies) tax relief resolutions;
  • List of all local government partners collaborating with the entity;
  • Description of the geographic boundaries of the zone;
  • Strategies to implement the Rural Jump-Start Program; and
  • Report of all businesses in the pipeline

If the sponsoring entity wants to modify the zone by changing boundaries, adding or removing municipalities, the sponsoring entity needs to file a separate application through the OEDIT application portal.

Review process

After you submit your application, the EDC will review it at the next meeting, which is on the third Thursday of every month. The EDC will approve, deny, or defer the application. The sponsoring entity will be notified of the decision.
 

To become an eligible business in the Rural Jump-Start Program, it must:

  • Not be operating (selling a product or service) in Colorado at the time of application; 
    • Eligible businesses may be planning, fundraising, recruiting, doing market research, preparing for production (designing/prototyping), filing business formation or registration, or manufacturing and testing a proof of concept, even if some revenue is associated with the activity.
  • Be located in a Rural Jump-Start zone;
  • Not directly compete with another business in its county or in an adjacent, economically distressed county; 
    • For example, a coffee shop would not qualify unless there were no other coffee shops in that county or adjacent county
  • Export goods and services outside the county;
  • Form a relationship with a sponsoring entity to align missions and benefit the community; and
  • Plan to hire at least five qualified New Hires (that are not existing jobs moving to the Rural Jump-Start zone). The chart below outlines the required hiring timeline for businesses to follow:
Year Hiring requirements
First full calendar year after EDC approval 1 new hire
Second full calendar year after EDC approval 3 new hires
All years after 5 new hires

 

To become a qualified New Hire, employees must:

  • Earn at least the county’s average annual wage or higher;
  • Receive a W-2 from the business;
  • Be legally allowed to work in the United States;
  • Be a resident of Colorado;
  • Be employed for at least six months with the business;
  • Work at least 35 hours per week; and
  • Spend at least 80 percent of their non-travel time at a location inside the Rural Jump-Start zone (they do NOT have to live in the zone)

Each zone is permitted to approve up to 200 New Hire allocations. The EDC may use its discretion to raise the limit to 300 New Hires in a zone. Other than this zone limit, there is no limit on the number of New Hire tax credits and grants issued to a business.

Qualified New Hires receive 100 percent reimbursement of their State Income Tax. Learn more about how New Hires receive their benefits.

There are three steps that must be taken to become a Rural-Jump Start Business:

Step 1: Contact the sponsoring entity in your Rural Jump-Start zone to determine qualification and create a Memorandum of Understanding, outlining the relationship

Examples of new business and sponsoring entity relationships include, but are not limited to:

  • Leasing property from the sponsoring entity or being located on or adjacent to the campus; 
  • Licensing intellectual property from the Designated Institute of Higher Education;
  • Funding or sponsoring research that relates to the business’s product, service development, or testing;
  • Employing faculty, staff, students, or recent graduates of the sponsoring entity as workers or consultants; or
  • Using specialized facilities at the sponsoring entity in developing products or services.

Step 2: Go to the OEDIT Salesforce portal and login to your account or create a new one. (To protect your personal information, we manually add new users to the portal, so it may take several days to activate your account.)

Step 3: Collaborate with the sponsoring entity to complete and submit the Rural Jump-Start application in Salesforce. Before submitting the application, attach the required documents:

  • Business Plan, including:
    • A description of customers and competitors, how your business adds to the economic base, and how the business plans to export goods/services outside the county;
    • Pro-forma income statement for the next three years;
    • Income statements and balance sheets for the last three years, if applicable;
    • Total employee and New Hire forecast for the next five years; and
    • Percentage of sales in Colorado, outside of Colorado, and outside the U.S.
  • Articles of incorporation or organization; and
  • Statement of Good Standing from the Colorado Secretary of State

Upon submission, OEDIT staff complete a rigorous competitive analysis in the applicant’s county and adjacent, economically distressed counties.

During a one-month waiting period, an existing Colorado business in an applicant’s county or an adjacent, economically distressed county may challenge an application if it believes a company would directly compete with the existing company’s core function. If another business challenges an application, OEDIT staff review the challenge and make a decision as to whether or not to move forward with the application.

If there are no challenges to the application and the business passes the competitive analysis, it will be presented to the EDC for final approval. The EDC meets on the third Thursday of every month.

If you have an existing Colorado business and believe a Rural Jump-Start business applicant would directly compete with your company’s core function, you may challenge the application before the Colorado Economic Development Commission approves it. To challenge a business application, please contact the program manager.

Step 1: File an annual report

Each year at the end of January, OEDIT staff will alert Rural Jump-Start businesses of the upcoming Annual Report due in the OEDIT Salesforce portal. Typically, Annual Reports are due by the last day of February, for the previous year. Your annual report will include information on business performance such as:

  • The number of employees, new hires, and owners;
  • Geographic areas of sales;
  • Product updates; and
  • How you support the sponsoring entity’s mission.

Step 2: File Form 104CR, (PDF) with the Colorado Department of Revenue

After reviewing a business’s Annual Report, OEDIT staff present all reports for approval to the EDC. Pending EDC approval, tax certificates for the business, qualified New Hires, and owners will be sent to the business for its distribution.

What happens if a business does not submit its Annual Report or turns it in late?

If a business does not file its annual report on time, OEDIT staff will send a 60-day notice to submit the information. If a business does not submit the annual report after the 60 days, it will be suspended from the program for the year. Suspended businesses must submit a plan for corrective action and the Annual Report to receive benefits in the next year.

If a business does not file an Annual Report after the 60-day notice of correction and does not respond to email and phone messages, OEDIT staff will send a final 30-day notice. If the business does not respond to the 30-day notice, OEDIT staff will recommend to the EDC revoking Rural Jump-Start approval. Revoking businesses from the program requires EDC approval.

If a business files late Annual Reports for two years, then it will lose Rural Jump-Start status. If this happens, a business will need to re-apply to the program with a new application.

New Hire Compliance

OEDIT staff will analyze a company’s new hires each year after receiving Annual Reports. If an Annual Report does not meet requirements, OEDIT staff will discuss the report with the business to ensure it is accurate. If a business does not meet the New Hire requirements, OEDIT staff will suspend Rural Jump-Start benefits for that year. The company will submit a plan for how the business will meet the requirements for the next year. If a company is suspended, it can only be reinstated after a subsequent year’s Annual Report.

If a business does not meet the requirements the next year, then it will lose Rural Jump-Start status. If this happens, the business must re-apply to the program with a new application.

Eligibility for Other Tax Credits

Businesses that claim the Rural Jump-Start tax credit may not claim any other Colorado tax incentive for establishing the business, including tax incentives for hiring net new employees.
 

General Operating Matching Grant

The Rural Jump-Start program matches a business’s operating expenses on a 3:1 or 25% basis, with a minimum reimbursement of $5,000. For example, if a business spent $20,000 on business supplies, the program would match $5,000.

The program will only match expenses made on or after the EDC’s approval of the business joining Rural Jump-Start. OEDIT cannot reimburse for expenses that occurred before the approval date.

Requests for reimbursement must be for reasonable business expenses such as, rent/mortgage, equipment, salaries, marketing, utility bills, etc. Reimbursements will not be allowed for tax-related expenses, late fees, or purchases that also benefit the owner personally. OEDIT staff reserves the right to deny reimbursements.

Businesses must fill out a line item spreadsheet of each expense that it requests reimbursement for. Back-up documentation is required for each expense on a reimbursement request. Receipts or proof of payment including the date, vendor, recipient of product/services, and amount are required for each and every expense. 

OEDIT staff will carefully review each expense for allowability. Upon approval, the payment will be completed.

New Hire Grants

New Hire grants are awarded after review of all Annual Reports in the Spring each year. Businesses will receive a one-time grant for all employees that meet New Hire qualifications.
 

New Business Name Sponsoring Entity Rural Jump-Start Zone Date Approved/Extended by EDC
Alpenglow Beverage, LLC Routt County Economic Development Partnership Routt June 16, 2022
Automated Widget Systems Colorado Mesa University/ Technical College of the Rockies Delta Apr 21, 2022
Certek Heat Systems Colorado Mesa University Mesa Mar 19, 2020
Cold Case Gear, Inc. Fort Lewis College Archuleta July 15, 2021
Colorado Herbs, LLC Technical College of the Rockies Delta Apr 15, 2021
Colorado Stone Quarries, Inc. Colorado Mesa University/ Technical College of the Rockies Delta Dec 17, 2020
Brightly Software, Inc. (formerly Dude Solutions) Colorado Mesa University Mesa Sep 20, 2018
Ecomposite Super Structures LLC Colorado Mesa University Mesa Sep 17, 2020
FHE USA, LLC Colorado Mesa University Mesa Sep 19, 2019
Gate 6 Enterprises, LLC dba Bar-U-Eat SSCRA Routt Jan. 20, 2022
Geyser Technologies Colorado Mesa University Montrose Dec 19, 2019
Jabil, Inc. Colorado Mesa University Mesa Mar 19, 2021
Kaart Group, LLC Colorado Mesa University Mesa Jun 16, 2020
Lyttle’s Fleet Maintenance, Inc. Colorado Mesa University Mesa Nov. 19, 2021
Phoenix Haus Colorado Mesa University Mesa Dec 21, 2017
ProStar GeoCorp, Inc. Colorado Mesa University Mesa Feb 11, 2020
Road Warrior Driver Training, LLC Community Economic Development of Sedgwick County Sedgwick Aug 25, 2022
Rocky Mountain Manufacturing Colorado Mesa University Mesa Dec 21, 2017
Sasquatch Campers, LLC FLC San Juan Dec 16, 2021
Scenic Express, Inc. Colorado Mesa University/ Technical College of the Rockies Delta Sept 16, 2021
SCORD, LLC Colorado Mesa University Mesa Oct 21, 2021
Sky Peak Technologies Colorado Mesa University Mesa Dec 16, 2021
Spring Born, Inc. Colorado Mountain College Garfield Aug 19, 2021
Town Hall Public Benefit Corporation SSCRA Routt Nov 19, 2021
Valkyrie Recovery Systems, Inc. Colorado Mesa University Mesa Sept 16, 2021

 

Program Manager

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