PRESS RELEASE FOR IMMEDIATE RELEASE March 26,1999 District Touts Special Business Tax Advantages WASHINGTON, DC - "Federal Tax Advantages for DC-Based Businesses" will be the topic of discussion at a National Press Club forum this Wednesday, March 31st, from 8:00 am to 10:30 am Tax and finance specialists from the Internal Revenue Service and the District will discuss the nuts and bolts of the new tax incentives applicable for the 1998 tax year, as well as provide the forms needed to claim special federal tax cuts. "This is the first tax year in which to claim more than $1.2 billion in new tax credits, exemptions and exclusions available to businesses operating in the DC Enterprise Zone." noted Congresswoman Eleanor Holmes Norton, the event's keynote speaker, who shepherded the Revitalization Act through Congress. "We worked extremely hard to win these unique tax breaks and this seminar is part of our effort to ensure our businesses know how to reap the benefits of their investments in the city." The Revitalization Act designated 122 of the District's 193 census tracts as the DC Enterprise Zone. The legislation is intended to spur increased business investment in the city by offering entitlements to employment tax credits, tax-exempt financing of building and equipment, accelerated depreciation of personal property, and a so-called "Brownfields" tax credit. Potentially the largest cash incentive is the exclusion of federal capital gains taxes on cash investment in DC Enterprise Zone businesses. The meeting is co-sponsored by the DC Chamber of Commerce, the DC Building Industry Association, the Downtown and Golden Triangle Business Improvement Districts and the Office of the Chief Financial Officer. For registration information contact Gail Edwards, Senior Vice President, DC Building Industry Association at telephone (202) 966-8665. SUMMARY OF NEW TAX INCENTIVES FOR DISTRICT BUSINESSES: For five years, businesses operating in the DC Enterprise Zone are entitled to claim an employment tax credit of as much as $3,000 annually for each District resident on their payrolls. Every new and existing business that moves into or expands operations within the DC Enterprise Zone may obtain up to $15 million of low interest rate financing for the acquisition, construction and substantial rehabilitation of a wide array of projects including, commercial buildings, restaurants, physician's offices, museums, grocery stores, pharmacies, recreation facilities, and other commercial establishments. The District is the only jurisdiction in the nation where businesses can receive zero percent federal capital gains tax treatment. To claim this benefit investors must pay cash for an ownership interest in a DC Enterprise Zone business and must hold the investment for a minimum of five years. Qualified small businesses can benefit by taking a current deduction (versus depreciating over time) for up to $200,000 of qualified equipment purchases after January 1, 1998. For further information on these incentives contact: The DC Revenue Bond Program Office of the Deputy Chief Financial Officer for Finance and Treasury 441 4th Street, N.W., Suite 440 North Washington, DC 20001 Tel. (202) 727-2778; Fax (202) 727-0700