The Major Eligible Employer Grant Program (MEE) is a strategic initiative designed to stimulate significant investment and job creation in Virginia. This discretionary program targets basic major employers considering a substantial expansion of existing operations or the establishment of new ones. A key requirement is that there must be active and realistic competition between Virginia and another state or country for the project.
The grant amount for each project is determined by the Secretary of Commerce and Trade, based on the Virginia Economic Development Partnership's (VEDP) Return-on-Investment analysis and recommendation. The program offers cash grants of up to $25 million to eligible applicants. These grants are paid in five to seven equal annual installments, starting in the third year after the capital investment and job creation or retention targets are met.
To qualify for the MEE program, projects must meet certain criteria. The project must be affiliated with a basic employer, meaning 51 percent or more of the facility's revenue must be generated outside the Commonwealth. The minimum capital investment threshold is $100 million. The minimum job creation threshold is 1,000 net new jobs, although this is reduced to 400 jobs if the average pay is at least twice the locality's prevailing average wage.
The definition of a "new job" under this program is employment of an indefinite duration, requiring a minimum of either 35 hours of the employee's time a week for the entire normal year of the firm's operations, which must consist of at least 48 weeks or 1,680 hours per year. At the discretion of VEDP, jobs may include teleworking positions held by Virginia residents who are employees of the recipient company or its affiliates.
The process for applying for the MEE grant involves several steps. The project is initiated with the VEDP Business Investment Manager. A due diligence review is then conducted, during which the VEDP Business Investment Manager works with the company to gather the necessary information for the project review process. The project is then reviewed by VEDP's Project Review and Credit Committee. If approved, the proposed incentive award is forwarded to the Secretary of Commerce and Trade for preliminary approval.
If the proposed MEE grant amount exceeds $10 million, approval from the Major Employment and Investment Project Approval Commission is sought. Once the grant is approved, the company is required to provide annual reports indicating progress toward achieving its investment and employment performance targets. The reports include an initial company notification and an annual progress report.
The initial notification must certify the amount of capital investment and the number of net new jobs created and maintained at the facility. The annual progress report verifies the level of capital investment, new jobs and wages, and notes whether the facility continues to operate at substantially the same level as when the capital investment was completed. This comprehensive program aims to boost Virginia's economy by attracting significant investments and creating stable job opportunities.
Navigating the complexities of the Major Eligible Employer Grant Program can be daunting. The program's stringent criteria, rigorous due diligence process, and ongoing reporting requirements necessitate a deep understanding of the program and its nuances. Partnering with Alvarez & Marsal can provide the expertise and guidance needed to successfully capture this incentive. A&M's seasoned professionals can help businesses understand the program's requirements, prepare a compelling application, and ensure compliance with reporting obligations. By leveraging A&M's expertise, your business can maximize its chance of securing the MEE grant, in which stimulating significant investment and creating job opportunities will thereby contribute to Virginia's economic growth.
Originally published by 22 October, 2024
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