Table of Contents Knowing Chandler Introduction Demographics City Services Business Resources Further Resources Starting Your Business Checklist Business Plan Structure & Name Further Resources Funding Options Financing Your Business Loans SBA Programs Grants & Credits Further Resources Establishing Your Location Location Type Zoning & Use Development Process Odds & Ends Further Resources Doing Business in Chandler Tax & License Environmental Further Resources Overview Labor Regulations Further Resources Appendix Table of Incentives Glossary of Terms Index 2 3 7 10 14 18 19 20 22 23 24 26 28 29 31 33 34 35 36 38 42 44 46 49 50 52 53 1 2009 Small Business Guide Knowing Chandler :: Introduction Since its founding in 1912, Chandler, Arizona was planned to be a welcoming destination for leading-edge companies, innovative thinkers and lifestyle versatility. Chandler is home to some of the most notable names in manufacturing, technology and business services. An enviable quality of life is enhanced by friendly neighborhoods, great education, and outstanding retail, dining and entertainment experiences. Year after year, large and small companies, along with thousands of well-educated residents, are attracted to this vibrant community. Chandler prides itself on having a progressive vision for success and creating a platform for possibility. Platform for Possibility 2 2009 Small Business Guide Knowing Chandler :: Demographics Growing Community Estimated Population (April ‘09) 2015 Projected Population 2000 Census Historical Growth from ‘00 to ‘08 Labor Force (March ‘09) Unemployment Rate (March ‘09) 251,894 272,700 176,581 42.6% 127,426 5.4% Job Growth Population Growth 3 2009 Small Business Guide Knowing Chandler :: Demographics Affluent Diversity Arizona Employee Wage Index Cost of Living Index $4.2 billion in disposable income Race & Ethnicity More than 20% of Chandler residents are fluent in a foreign language 4 2009 Small Business Guide Knowing Chandler :: Demographics Young & Educated Median age: 32.8 Within a 30 minute drivetime, 134,000 people have advanced degrees; 264,000 have bachelor’s degrees Over 110,000 Chandler residents have some college; 51,000 with bachelor’s degrees Education Levels 5 2009 Small Business Guide Knowing Chandler :: Demographics Workforce Workforce Breakdown Globally Aware Worldwide presence of major employers = Global Diversity * Each line represents the global locations of Chandler’s top employers 6 2009 Small Business Guide Knowing Chandler :: City Services Economic Development Division The City of Chandler Economic Development Division promotes the city as a preferred location for new and expanding businesses. Our primary purpose is to enhance employment opportunities and improve Chandler’s tax base by focusing on industrial, office, retail, revitalization and tourism development. Our responsive team of professionals offers programs and services tailored to support the business and commercial real estate community. Partnering with Arizona Department of Commerce and the Greater Phoenix Economic Council, we market Chandler domestically and internationally with the purpose of attracting new business investment and new job creation to our city. In addition to maintaining a strong job base, we work to create a diverse mix of quality retail and tourism experiences. The Economic Development Division partners with the Chamber of Commerce to reach out to Chandler’s existing businesses to ensure that Chandler is a place where companies thrive. We continually assess the needs of existing business with an eye toward developing solutions, enhance opportunities and increase economic growth within our community. We are here for you to: • Provide data to help you make informed business location decisions • Connect you with other appropriate city offices and resources • Assist with development and/or occupancy processes Organization Chart 7 2009 Small Business Guide Knowing Chandler :: City Services Chandler Economic Development The City of Chandler’s Economic Development Division has staff dedicated to meeting the needs of small business owners. Services provided by staff include help in the site selection process, assistance in navigating the zoning, permitting and licensing processes and connecting you to the resources that will help your business thrive. Staff can also provide market data, including demographics for Chandler and other competing areas. Chandler Public Library Chandler’s Public Library System consists of four branches spread throughout the city to ensure the availability of information resources. The libraries are equipped with current computer systems that provide direct access to business sites via the Internet, as well as subscription database titles. Anyone who has a Chandler Library card and a PIN can access these databases from their home or office as well. Electronic resources include: The Business and Company Resource Center A comprehensive research collection offering accurate, updated company and industry intelligence on thousands of global companies Reference USA A directory and market research tool containing detailed information on millions of businesses and U.S. residents GrantSelect A searchable list of funding opportunities from thousands of organizations throughout the country. All four libraries have books and audios about small business startup, entrepreneurship, finance, marketing, law, sales, personnel and other relevant topics. Downloadable materials are also available free through the Greater Phoenix Digital Library. (See www.chandlerlibrary.org). Library staff can help with locating materials and conducting database searches. Call the Reference Desk (for assistance or to make an appointment for individual tutoring) or log on to the web site — www.chandlerlibrary.org click on “Ask a Question” and receive an answer to your query via e-mail. 8 2009 Small Business Guide Knowing Chandler :: City Services Chandler Diversity Office The City’s Diversity Office works closely with the Chandler Human Relations Commission to develop diversity programs and events that support the mission of promoting mutual respect and inclusion in Chandler. Along with the community, the Diversity Office works toward the elimination of prejudice and discrimination; and to promote amicable relations among all racial, cultural, religious, age, gender, disabled, socioeconomic and national groups within the community. The Diversity Office maintains relationships with numerous individuals and organizations that seek to promote the success of minority-owned small businesses and staff can provide referral assistance to interested parties. Chandler Planning and Development Interdisciplinary Small Business Interaction Team The Interdisciplinary Small Business Interaction Team (ISBIT) focuses on existing Chandler businesses that want to expand, relocate, convert, and/or renovate their existing place of business. ISBIT is poised to proactively meet the development needs of the small business community by identifying and minimizing the development impediments in order to enhance the client’s interaction with the City. Most importantly, ISBIT provides the small business owner with a single point of contact within the City who acts as a guide through the permitting and licensing processes. ISBIT referrals are accepted at the Development Services Customer Counter and directed to the Customer Services Supervisor. The supervisor performs a simple interview with the prospective client and based on the input, confers with knowledgeable staff and formulates an action plan. Key Planning & Development Department staff will follow-up with the client either by telephone, e-mail or in person. Knowledgeable staff will identify and explain: • • • • The development issues that may be expensive and/or time intensive The pertinent city code requirements (building and zoning codes) The development process steps through certificate of occupancy The review timeline, submittal requirements, fee requirements, permit requirements, and inspection requirements 9 2009 Small Business Guide Knowing Chandler :: Business Resources Chandler Chamber of Commerce The Chandler Chamber of Commerce is a private, non-profit business organization that has been in business since 1912. Through nearly 100 years of service to the business community, the Chandler Chamber of Commerce has become an important advocate for the business community and the primary source for business to business networking. The Chamber offers valuable information to small business owners in association with the Service Corps of Retired Executives (SCORE). Counseling sessions are held by appointment. Contact the Chandler Chamber of Commerce for more information. One of the primary benefits that member businesses enjoy is the various marketing and networking opportunities provided by the Chamber. In addition, members are encouraged to get involved by serving on Chamber Committees such as the Chamber Ambassadors, Member Outreach, Public Policy and others. Arizona Department of Commerce The Arizona Business Connection is your one-stop resource for information and referrals at every step of the small business development process: startup, expansion or relocation. The office also provides minority and women business owners with information on relevant business programs and services. The Arizona Department of Commerce provides a variety of resources to assist entrepreneurs. Small Business Services (SBS) provides information and statewide resources for starting, operating and growing a business in Arizona. The SBS online program at www.azcommerce.com/smallbiz provides you with a customized step-by-step checklist of what you need to know, whom you need to contact and where you need to go for business licensing, registration, tax requirements, funding, hiring, certification, procurement opportunities and business resources. To be certified as a Minority-, Woman-owned, Small and Disadvantaged Business Enterprise, a company must meet all qualifying standards and be at least 51 percent owned, operated and controlled by a qualifying 10 2009 Small Business Guide Knowing Chandler :: Business Resources person or persons. Organizations providing certification and registration programs for minority-, woman-owned, small and disadvantage businesses are listed at www.azcommerce.com/smallbiz. The Arizona Small Business Advocate is the Executive Director of the Governor’s Council on Small Business (GCSB). The Advocate is responsible for keeping an open line of communication between the Governor, the Director of the Arizona Department of Commerce, the GCSB and the Arizona small business community. The Advocate and GCSB work with chambers of commerce and other groups to develop recommendations for policies and programs addressing fundamental issues related to small business in Arizona. Visit their website at www.azcommerce.com/smallbiz. College & University Assistance Colleges and universities have many programs that are designed to help build the local economy. They also have access to vast amounts of information through their research and databases. Institute’s member centers have ASU L. William Seidman Research gained the recognition and respect Institute of business practitioners and Based on the vision of former Dean academics the world over. L. William Seidman, the Seidman ASU Career Services Office Research Institute today serves as Provides a vast array of services an essential link between the local, including resume referrals, job national and international business listings, on campus recruitment, communities and the intellectual and creative resources of Arizona pre-recruiting information, job fairs and information sessions. State University’s nationally ranked school of business. From ASU Spirit of Enterprise Center collecting and disseminating The Spirit of Enterprise Center brings essential information about local students and businesses together economies to benchmarking to accelerate entrepreneurship industry practices to identifying within the communities they emerging business research serve. issues, the Seidman Research 11 2009 Small Business Guide Knowing Chandler :: Business Resources ASU Office of Economic Affairs Oversees several various programs that could provide useful resources including: ASU Technopolis and the ASU/Scottsdale Center for Innovation and Technology. ASU Advanced Technology Innovation Center Created to assist entrepreneurs and startups build their product ideas, taking innovation from paper to an actual prototype. ASU Technopolis Offers rigorous programs that educate, coach and connect innovators and entrepreneurs. Arizona Technology Enterprises The office is responsible for transferring intellectual property from the University to the commercial market, and assist companies in all facets of tech transfer business establishment. Chandler-Gilbert Community College Chandler-Gilbert has three East Valley campuses and is part of the Maricopa County Community College system. Customized training and various services for small businesses are offered at the Pecos Campus. Furthering Education for Employees Arizona Department of Commerce - Workforce Recruitment & Job Training Program The Arizona Work Force Recruitment and Job Training program, through the Arizona Department of Commerce, provides short-term customized grants for the training of net new employees. The program is administered in coordination with training providers such as the community colleges, private post-secondary institutions, trade schools or with the applicant itself. The program funds up to 75% of the total eligible costs while the company contributes the other 25%. Recent awards range from $300 to $1,000 per employee. The City of Chandler works closely with the Maricopa Community College District to assist companies in meeting all facets of their workforce needs. This includes developing customized training programs, recruitment and pre-screening, and assisting with the application process for the Arizona Work Force and Job Training Grant. 12 2009 Small Business Guide Knowing Chandler :: Business Resources Maricopa Workforce Connections Maricopa Workforce Connections works with local businesses, faith and community-based organizations to help area businesses succeed in securing qualified talent, training current employees to use new industry technology, and providing lay-off aversion resources and transition strategies. 13 2009 Small Business Guide Knowing Chandler :: Further Resources Chandler Economic Development Division 215 E Buffalo St Phone: Chandler, AZ 85225 Fax: 480.782.3030 480.782.3040 Chandler Diversity Office 55 N Arizona Pl #301 Chandler, AZ 85225 Phone: Fax: 480.782.2217 480.782.2209 Phone: 480.782.2803 Phone: 480.782.2828 Phone: 480.782.2840 Phone: 480.782.2850 Chandler Public Library Downtown Library 22 S Delaware St Hamilton Library 3700 S Arizona Ave Sunset Library 4930 W Ray Rd Basha Library 5990 S Val Vista Dr Chandler Planning and Development Interdisciplinary Small Business Interaction Team 215 E Buffalo St Phone: 480.782.3171 Chandler, AZ 85225 Arizona Department of Commerce - Small Business Services 1700 W Washington St Phone: 602.771.1196 Suite 600 Web: www.azcommerce.com/ Phoenix, AZ 85007 smallbiz Workforce Resources Arizona Department of Commerce - Workforce Recruitment & Job Training Program 1700 W Washington St Phone: 602.771.1181 Suite 600 Web: www.azcommerce.com/ Phoenix, AZ 85007 workforce/jobtraining Maricopa Workforce Connections Goodwill Industries of Central AZ 930 N Alma School Rd Phone: Chandler, AZ 85224 14 2009 Small Business Guide 480.792.6924 Knowing Chandler :: Further Resources Education Resources ASU Spirit of Enterprise Center WP Carey School of Business BA 101 Tempe, AZ 85287 Phone: Fax: Web: 480.965.0474 480.727.6185 www.wpcarey.asu.edu/Spirit ASU Office of Economic Affairs 300 E University Dr Suite 310 Tempe, AZ 85287 Phone: Fax: Web: 480.965.1225 480.965.8293 www.ovprea.asu.edu ASU L. William Seidman Research Institute PO Box 874011 Phone: Tempe, AZ 85287 Fax: Web: 480.965.5362 480.965.5458 www.wpcarey.asu.edu/seid ASU Career Services Office 1151 S Forest Ave Tempe, AZ 85287 Phone: Web: 480.965.2350 www.asu.edu/studentaffairs/ career ASU Technopolis 1475 N Scottsdale Rd 2nd Floor Scottsdale, AZ 85257 Phone: Fax: Web: 480.884.1804 480.884.1888 www.asutechnopolis.org ASU Advanced Technology Innovation Center 7171 E Sonoran Arroyo Mall Phone: Peralta Bldg. Suite 230 Fax: Mesa, AZ 85212 Web: Arizona Technology Enterprises SkySong 1475 N Scottsdale Rd Suite 200 Scottsdale, AZ 85257 Phone: Fax: Web: 480.727.1647 480.727.1248 http://atic.asu.edu 480.884.1996 480.884.1984 www.azte.com ASU Realty Studies: JP Morgan Economic Outlook Center: ASU Center for Competitiveness & Prosperity Research: ASU Center for Services Leadership: 480.727.1300 480.965.5362 480.965.3961 480.965.6201 15 2009 Small Business Guide Knowing Chandler :: Further Resources Chandler-Gilbert Community College Pecos Campus Phone: 2626 E Pecos Rd Fax: Chandler, AZ 85225 Web: 480.732.7000 480.732.7090 www.cgc.maricopa.edu Chamber Resources Chandler Chamber of Commerce 25 S Arizona Pl Phone: Suite 201 Toll Free: Chandler, AZ 85225 Fax: Web: 480.963.4571 800.963.4571 480.963.0188 www.chandlerchamber.com Arizona Small Business Association 4130 E Van Buren St Phone: Suite 150 Fax: Phoenix, AZ 85008 Web: 602.265.4563 602.265.3681 www.asba.com Arizona Hispanic Chamber of Commerce 255 E Osborn St Phone: Suite 201 Fax: Phoenix, AZ 85012 Web: 602.279.1800 602.279.8900 www.azhcc.com Asian Chamber of Commerce 7217 N 6th Way Phoenix, AZ 85020 Phone: Fax: Web: Chinese Chamber of Commerce of Arizona PO Box 32865 Web: Phoenix, AZ 85064 602.222.2009 602.870.7562 www.asianchamber.org www.cccarizona.org Greater Phoenix Black Chamber of Commerce 201 E Washington St Phone: 602.307.5200 Suite 350 Fax: 602.307.5204 Phoenix, AZ 85004 Web: www.phoenixblackchamber.com Greater Phoenix Chamber of Commerce 201 N Central Ave Phone: 27th Floor Fax: Phoenix, AZ 85004 Web: 16 2009 Small Business Guide 602.495.2195 602.495.8913 www.phoenixchamber.com Knowing Chandler :: Further Resources Greater Phoenix Economic Council (GPEC) 2 North Central Ave Phone: Suite 2500 Toll Free: Phoenix, AZ 85004 Fax: Web: US Women’s Chamber of Commerce 1200 G Street, NW Toll Free: Suite 800 Web: Washington, DC 20005 On-line Assistance ABC’s of Small Business and Entrepreneur Success Web: www.liraz.com Create a Business Website Web: www.hostway.com Retirement Business Startup Guidance Web: www.bizstarters.com Kauffman Foundation e-Venturing Entrepreneur’s Resource Center Web: www.entrepreneurship.org Small Business Help Center Web: www.helpbizowners.com 602.256.7700 800.421.4732 602.256.7744 www.gpec.org 888-41-USWCC www.uswcc.org House Small Business Committee Web: www.house.gov/smbiz The U.S. Chamber of Commerce Small Business Center Web: www.uschamber.com/sb Small Business Taxes and Management Web: www.smbiz.com The Wall Street Journal Center for Entrepreneurs Web: http://startup.wsj.com 17 2009 Small Business Guide Starting Your Business :: Checklist Business Startup Introduction Starting a business can be an overwhelming task, but approaching it in a thoughtful, thorough way can help to make the process less daunting. This guide is a compilation of information designed provide both information and to lead you to further resources. We encourage you to look at, examine and research many resources to gain as many ideas and perspectives as possible. The Further Resources pages at the end of each section will help you do this. Please feel free to contact the Economic Development Division with any questions you might have. Business Startup Checklist q q q q Conduct research on your industry, target market and competition. Prepare a written business plan complete with financial statements. Establish a source of adequate and reliable financing. Retain an attorney and CPA, if appropriate. q Decide whether you wish to operate as a sole proprietorship, partnership or corporation. q Check on zoning ordinances q Select a suitable location (obtaining a professional site selector is a free service for businesses - brokerage fees paid by the lessor/building owner) q q q q q q q q q Choose a name, research the availability and register. Obtain a Federal Employer Identification Number (EIN), if needed. Find a bank that’s right for you. Open bank accounts. Acquire necessary licenses and/or permits for state, county and/or city. See insurance agent for full range of coverage. Obtain bonding and insurance, if necessary. Arrange for utilities, telephone and other services Review all labor regulations, if hiring employees. Choose a record keeping system and method of inventory control. 18 2009 Small Business Guide Starting Your Business :: Business Plan Business Plan A written guide to starting and running your business successfully is essential. This plan will encourage loans, promote growth and provide a map for you to follow. Basic Business Plan Elements Source: SBA 19 2009 Small Business Guide Starting Your Business :: Structure & Name Business Legal Structure One decision that business owners need to make early in their business planning process is which legal form of business to choose. Before this decision is made a thorough understanding of the advantages and disadvantages of each legal structure is important. Business owners will need to consider the legal and tax-related implications of each form of business and determine which best fits their needs. Advice from an attorney and/or certified public accountant is recommended before making this decision. Business structures available in the state of Arizona are: • • • • Sole Proprietorship Limited Liability Company (LLC) C Corporation S Corporation • General Partnership • Limited Partnership (LP) • Limited Liability Partnership (LLP) See chart on page 21 for detailed information on each structure Choosing a name and registering your business If you were asked to name the first computer chip business that comes to mind, who would it be? Intel perhaps. What about a tire manufacturer? Probably Goodyear Tire Company. Having name recognition or what is commonly referred to as “Top of Mind Awareness” is essential in today’s world of intense competition and constant advertising. It all begins with selecting the right business name. There are several factors to consider when choosing a name for your business, such as: • • • • Is the name already in use? Name type - descriptive or non-descriptive. Ease of use – easy to spell and pronounce. Posative connotation - Goodyear for Goodyear Tires. The best way to register you business name is to visit the Secretary of State’s website at www.azsos.gov. Under Business Services, then Registrations and Filings choose trade names and trademarks. From there you can search for existing names and guidelines. Forms can be downloaded and either mailed in or you can apply in person at the Office of the Secretary of State. 20 2009 Small Business Guide Sole Proprietorship Arizona filing requirements Number of owners allowed Partnerships Limited Liability Company (LLC) “C” Corporation “S” Corporation • None • Recommended trade name registration General Partnership • Articles of • None organization • Recommended trade name registration Limited Partnership • Certificate of LP • Trade name registration Limited Liability Partnership • Certificate of LP • Trade name registration • Articles of incorporation • Articles of incorporation • 1 owner • At least 2; no upper limit • Partners (general or limited) • At least 1; no upper limit • Members are owners • At least 1; no upper limit • Shareholders are owners • At least 1; upper limit - 75 • Shareholders are owners • No, income/ loss is passed through to all members • Yes, Shareholders also report income from distributions and bonuses • Officers and directors report salary income • No, income/ loss is passed through to the shareholders • No, sole • No, income/loss is passed proprietor pay all through to all partners taxes • LP and LLP files taxes as a Subject to separate entity, must meet certain criteria to avoid being income tax at taxed as a corporation entity level • Minimum legal restrictions • Ease of formation • Low start-up costs • Sole ownership of profits • Maximum freedom in decision-making General Partnership • Ease of formation • Direct rewards • Broader management base Limited Partnership • Operated like general partnership • At least one general partner has unlimited liability •Limited partners protected unless participate in management Limited Liability Partnership • Operated like general partnership • Partners not typically responsible for debts of the LLP • Limited disclosure of owners • Ease in transfer of ownership • Can use different classes of owners • Lower filing fees • Can assign management to a non-member • Separate legal entity • Limited liability for stockholders • Unlimited life of business • Relative ease in raising capital • Transfer of ownership through sale of stock • Restrictions on number of shareholders • Unlimited life of business • Unlimited Liability • Less available capital • Relative difficulty in obtaining longDisadvantages term financing General Partnership • Unlimited liability of general partners • Divided authority in leadership • Difficulty in disposing of partnership interest Limited Partnership • Limited partners may not participate in management Limited Liability Partnership • The lack of clear precedents could be a disadvantage • Unclear in those states that do not have LLP status • Large number of owners complicates status • Death, owner withdrawal or bankruptcy could cause problems • Doing business in other states may require filing individual tax returns in each state • Complex and relatively expensive to organize • Activities limited by Charter • Extensive regulation and record-keeping requirements • Double taxation - once on corporate profits and again on dividends • Restrictions on number of shareholders • Limitations on ownership Advantages Source: Arizona Entrepreneur’s Edge 21 2009 Small Business Guide Starting Your Business :: Further Resources Chandler Economic Development Division Office Location: Mailing Address: 215 E. Buffalo St. Mail Stop 416 Suite 105 PO Box 4008 Chandler, AZ 85225 Chandler, AZ 85244 Phone: 480.782.3030 Fax: 480.782.3040 Web: www.chandleraz.gov/ed Business Plan and Legal Structure Resources Arizona Department of Commerce - Small Business Services Arizona Entrepreneur’s Edge is a publication that shows a detailed step-by-step process to start your business. Google Search Terms: Arizona Entrepreneur’s Edge Phone: 602.771.1196 Arizona Small Business Development Center Free business plan counseling Google Search Terms: azsbdc free business counseling 30 Service Corps of Retired Executives (SCORE) Business plan templates and free business counseling Google Search Terms: score business plan Small Business Association (SBA) In addition to being a step-by-step guide to designing a business plan, this resource gives tips on specializing your business and what lenders want to see. Google Search Terms: SBA, write business plan Google Search Terms: SBA, choose a structure Phone: 602.745.7200 Naming & Registering your Business Arizona Secretary of State Google Search Terms: azsos tnt Phone: 602.542.6187 22 2009 Small Business Guide Financing Your Business :: Funding Options Loans, Grants & Investments Contrary to popular perception, grants for new businesses are difficult to come by. Most businesses are financed by personal resources, family loans or commercial loans. This section will cover how to give yourself the best chance possible of obtaining commercial loans, grants and investment, also covering the benefits and challenges of each option. Funding Types The primary funding most people acquire is personal funding which could be provided through home equity loans, credit cards, friends and family, etc. However, depending on the type of business you wish to start, this may be enough, but for many these personal resources are not. In this case there are many avenues that you may follow. Your financial need greatly determines which opportunities are optimal for you and your business. For Machinery and Supply Needs • Negotiate with suppliers, using a promissory note rather than cash, if possible • Lease machinery, if possible • Equity bartering is when equity in the company is offered in lieu of payment • Licensing is when another company assumes various costs of bringing the product to market in exchange for payment of royalties • Partner with companies that are more established until your company is self-sufficient. This will often be a company that sees some direct benefit from your product being in the market For Monetary Needs • Traditional Loans from commercial banks or lending institutions is a common way to gain capital • Grants may be available, especially if you are bringing technology related products to market • Investments may be attained from an angel fund or venture capitalists In all cases seek whatever help necessary in understanding the terms of these agreements. 23 2009 Small Business Guide Financing Your Business :: Loans Commercial Loans Lenders, being adverse to risk, have developed criteria design to help them determine a potential clients level of risk. Lenders look at what can be distilled as the 5 Cs: Capacity, Collateral, Credit, Character and Conditions. Capacity - The ability of a borrower to repay the loan shown by historic cash flow (financial statements etc.) and prospective cash flow (business projections). Collateral - This is the security pledged for the repayment of the loan. Credit - Credit shows your historic tendency towards repaying loans and managing borrowed capital. Both your and your company’s credit will be examined. Character - The most intangible of the criterion because it involves impression, perception and reputation. Conditions - This involves the terms of the loan, meaning interest rate duration of loan, etc. Theses are all established by the lending institution. Materials Needed when Applying for Loans • • • • Loan Application • Loan Proposal • Size of Loan Business financial statements (3 years) • Owner Equity Current financial statements Financial statements from anyone who • How funds will be used • Personal credit record owns 20% or more of the company • Two years of personal income • Description of the purpose of the funds verification • Payback plan with • Management resumes contingency plan • Business debt schedule Source: Arizona Entrepreneur’s Edge Note: This is not meant to be an exhaustive list; each lender will have specific requirements 24 2009 Small Business Guide Financing Your Business :: Loans AZ Minority Business Development Center Business Development Finance Corporation CDC Small Business Finance j j Arizona Small Business Development Centers j j j jjj jj j j j j j j National Center for American Indian Enterprise Development NEDCO Prestamos jj j j j j SCORE SBA* j j j Technical & Mgmt. Assistance Online Training Low Cost Training Courses Loan Package Assistance Loan Guarantee $0-$1M Loan Range $10K- $5M Loan Range $2K$35K Loan Range $100-$25K Financing/Loan Guarantees Loan Assistance & Guarantees j * SBA provides loan guarantees through SBA-qualified lenders. 25 2009 Small Business Guide Financing Your Business :: SBA Programs Minority Business Certification Programs 8(a) Program Federal agencies set aside funds for minority-owned and socially and economically disadvantaged firms (8(a) and SDB certified firms). The 8(a) certification program allows such companies to compete for set aside funds for up to nine years. At least 51 percent of the firm must be owned by a socially and economically disadvantaged person(s). An individual’s personal net worth cannot exceed $250,000, excluding ownership interest in the applicant firm and equity in a personal residence, to be considered economically disadvantaged. Benefits of the program include technical and management assistance by SBA and its resource partners and access to federal procurements. Small Disadvantaged Business (“SDB”) Certification Program This program pertains to benefits in Federal procurement. SDBs are eligible for price evaluation adjustments of up to 10 percent when bidding on federal contracts. SDBs must be 51 percent owned by a socially and economically disadvantaged person(s). An individual’s net worth cannot exceed $750,000, excluding ownership interest in the applicant firm and equity interest in a personal residence. SBA Loan Programs SBA’s Microloan Program SBA extends funding to nonprofit intermediaries who make loans from $100.00 to $35,000.00 to small businesses. Technical assistance is also available to small businesses from the intermediaries. SBA 504 Loan Program This program is for growing businesses to finance major fixed assets such as new machinery and equipment or real estate — including existing buildings and/or new construction. A typical 504 project requires only 10% injection from the borrower. The program is designed to enable small businesses to create and retain jobs. 26 2009 Small Business Guide Financing Your Business :: SBA Programs 7(a) Guarantee Loan Program The 7(a) program is a flexible program designed for small businesses just starting out or those looking to expand. SBA offers loan guarantees to participating lenders to increase access to capital for small businesses. • • • • • SBA offers loan guarantees of 85 percent on loans of $150,000 and less. Loans $150,001 to $2,000,000 receive a 75% guarantee. $2,000,000 is the maximum gross 7(a) loan amount. SBA’s maximum guaranteed portion is $1,500,000. A business must be operated for profit and may not exceed SBA’s size standards. Interest rates are negotiated between the borrower and the lender and are subject to SBA maximums. For loans that are more than $50,000, interest rates must not exceed Prime plus two and one-quarter percent (2.25%) if the maturity is less than seven (7) years, and must not exceed Prime plus two and three-quarters percent (2.75%) if the maturity is seven (7) years or more. For loans between $25,000 and $50,000 maximum rates must not exceed Prime plus three and one-quarter percent (3.25%) and three and three-quarters percent (3.75%), respectively. And, for loans of less than $25,000, the maximum interest rate must not exceed Prime plus four and one-quarter percent (4.25%) and four and three-quarters percent (4.75%), respectively. The general terms are 5 to 10 years for machinery, equipment and working capital, and up to 25 years for the purchase and/or construction of real estate including major renovation. A weighted average term will be calculated for multi-purpose use loans. Loan fees for a loan of $150,000 or less, are one percent (1.00%) of the 85% SBA-guaranteed portion. For a loan of $150,000 to $700,000, the guarantee fee is two and one-half percent (2.50%) of the 75% guaranteed portion. For a loan of more than $700,000, the guarantee fee is three and one-half percent (3.50%) of the 75% guaranteed portion. 7(a) based loan programs include: SBA Express; Community Express; Export Working Capital; International Trade Technology Grants 27 2009 Small Business Guide Financing Your Business :: Grants & Credits Though grants are few and far between, many of the grants available are offered to technology companies. These are offered for companies in the research and development stage and when preparing for market. Both the state of Arizona and the federal government offer these grants. State Technology Grants Market Assessment Grant* Small companies receive help determining the market potential of a technology product under development. Technology Assessment Grant* Small technology companies receive assistance getting their product validated and reviewed. Research & Development Tax Credit* Individual income tax credit for qualified research conducted in the tax year. AZ FAST Program Grant* Up to $5,000 in grant writing consulting services when a small technology company is applying for federal Small business innovation Research (SBIR) or Small Business Technology Transfer (STTR) grants. *See Appendix for further information 28 2009 Small Business Guide Other Grants & Credits Enterprise Zone* Small businesses located within an Enterprise Zone or that have employees living in Enterprise Zones receive reduced primary property taxes or credits for employees. Arizona Job Training Grant* Companies can receive monies, $2,000 to $8,000 per employee, as reimbursement for training. Commerce & Economic Development Commission (CEDC) Loans/Grants* Companies can receive monies to fund projects in areas of interest. Angel Investment* Companies can get certified with the state for the Angel Investment Program as a Qualified Small Business. This means that capital investors can invest in these companies and receive significant tax incentives on their investment. Financing Your Business :: Further Resources Loan Help & Financing Arizona Minority Business Enterprise Center 255 E Osborn Rd Phone: Suite 202 Toll Free: Phoenix, AZ 85012 Fax: Web: 602.248.0007 800.428.7299 602.279.8900 www.azmbec.com Business Development Finance Corporation 3300 N. Central Ave Phone: Suite 600 Toll Free: Phoenix, AZ 85012 Fax: Web: 602.381.6292 800.264.3377 602.381.8012 www.bdfc.com CDC Small Business Finance 2910 E Camelback Rd Suite 185 Phoenix, AZ 85016 Toll Free:: Toll Free: Fax: Web: Arizona Small Business Development Center 2411 W 14th St Phone: Suite 114 Fax: Tempe, AZ 85248 Web: 800.611.5170 800.817.4505 602.393.2682 www.cdcloans.com 480.731.8721 480.731.8729 www.azsbdc.net The National Center for American Indian Enterprise Development National Headquarters Phone: 480.545.1298 953 E Juanita Ave Fax: 480.545.4208 Mesa, AZ 85204 Web: www.ncaied.org The Neighborhood Economic Development Corporation (NEDCO) 12 N Center Phone: 480.969.1093 Mesa, AZ 85201 Fax: 480.275.2849 Web: www.nedco-mesa.org Services Key 29 2009 Small Business Guide Financing Your Business :: Further Resources Prestamos - A Division of Chicanos Por La Causa, Inc. 1122 E Buckeye Rd Phone: 602.257.6777 Suite B-4 Fax: 602.307.0336 Phoenix, AZ 85034 Web: www.prestamosloanfund.org Service Corps of Retired Executives (SCORE) 1201 S Alma School Rd Phone: RM #4800 E-mail: Mesa, AZ 85210 Web: 480.833.9020 eastvalley@scorephoenix.org www.evaz.scorechapter.org Small Business Administration (SBA) 2828 N Central Ave Phone: Suite 800 Fax: Phoenix, AZ 85004 Web: 602.745.7200 602.745.7210 www.sba.gov/az/ Grants & Credits Information Chandler Economic Development Division Office Location: Mailing Address: 215 E. Buffalo St. Mail Stop 416 Suite 105 PO Box 4008 Chandler, AZ 85225 Chandler, AZ 85244 Phone: 480.782.3030 Fax: 480.782.3040 Web: www.chandleraz.gov/ed Arizona Department of Commerce - Office of Innovation & Technology The Office of Innovation & Technology supports the development of business. Google Search Terms: commerce office innovation technology Phone: 602.771.1215 E-mail: jaymiep@azcommerce.com Arizona Department of Commerce - Small Business Services Google Search Terms: Arizona Small Business Services Phone: 602.771.1196 E-mail: smallbiz@azcommerce.com 30 2009 Small Business Guide Establishing Your Location :: Location Type You’ve probably heard before that the three most important factors in starting your business are: Location, Location, Location. The City of Chandler’s Economic Development Division is poised and ready to help you with making that most important decision. The choice of location may have a significant impact on the success of your business. Therefore, this phase of your business development process must be given the time and consideration it deserves. Some factors to consider when selecting a site for your business are: • • • • • Do you plan to buy or lease? Type and history of the site Parking Condition of the building Total cost and terms of the lease • Home-based business? • Existing space? • • • • • • Build your own building? Is there room to expand? Client base Traffic counts/traffic patterns Demographics Nearby services (competition, retailers, employee services, etc.) It may be in your best interest to retain a qualified broker to guide you through the site selection process. Normally, the broker will represent you while the owner of the property you select pays their fee. The broker will guide you through the selection and negotiation process. The City of Chandler’s Economic Development staff has a listing of qualified brokers who frequently do business in Chandler and are familiar with our specific market. What type of space fits your needs There are many types of facilities to choose from, but before selecting space you need to know what type of zoning your business fits within. In general, there are three types of zoning for businesses: Commercial, Office and Industrial. Within those general categories the City of Chandler Zoning Code is very specific about what type of use is compatible in that area. Further, if you would like to start a business out of your home, there are some restrictions, mostly having to do with public safety and nuisance. For example, it is not allowed to pave over your front yard and use it as a 31 2009 Small Business Guide Establishing Your Location :: Location Type parking lot because it disrupts the residential nature of the area. Every zoning decision has reasons behind it, though exceptions are made, it is always important to speak with Economic Development (ED) or Planning and Development staff before choosing a building with zoning that does not fit your use. See the chart below for an overview of location types and what those choices might mean for you. 32 2009 Small Business Guide Establishing Your Location :: Zoning & Use Permits Home-Based Business To begin a home based business, you must first determine that the business you are planning will be allowed in residential areas. This will prevent issues and possibly fines, down the road. To do this, you must read and fill out an application for clearance with the city. As part of the application you will have to verify that you will not change the residential character of the neighborhood. For this application go to www.chandleraz. gov/ed and then to Small Business. There is a pdf of the application on this page. Use Permits A Use Permit is a permit that allows a land use that is otherwise not permitted within a specific zoning district. A Use Permit requires approval by City Council. It is important to realize that a Use Permit can take as long as six months to go through the city process. If this is not in your timeline, you will need to find an alternative location. To see if your use is one allowed by a Use Permit you can call the city’s Planning and Development Department or look at the zoning code at www.municode.com. See Chapter 35, Section 2100 of the City Code (35-2100) for the Use Table. Zoning Changes A zoning change is a change to the city’s zoning code in order to modify the uses permitted at a given site. If a building or site seems like a good fit for your business, but your use is not included as an approved use through its zoning or a use permit, the first step is to speak with Economic Development and Planning staff to determine if staff is supportive of such a change. If staff is supportive, the change has a high likelihood of getting approved. The process takes between six and eight months. 33 2009 Small Business Guide Establishing Your Location :: Development Process Building your own building If you are building your own building in Chandler you must typically go through the complete development process. Luckily there are many people to help make this process smooth, predictable and accessible. Each project is assigned a Development Project Administrator (DPA) to oversee the process. You can be in contact with them so that you are aware of where your project is in the process. ED staff will also be available to help in any way possible as you move forward. The following is a brief outline of the steps necessary to build a building in Chandler. e *Please note that this chart is meant as a general illustration of what one might expect, please consult city staff for an official explanation of your specific process. 34 2009 Small Business Guide Establishing Your Location :: Odds & Ends Certificate of Occupancy A Certificate of Occupancy (C of O) is given to a company when appropriate inspections have been done to determine that if the building meets code and that current zoning matches the use of the business going into that location. Every business needs to get a Certificate of Occupancy before they may open for business. Fire & Police Safety The Fire and Police Departments are responsible for ensuring compliance with local fire and police codes. Compliance with fire code is achieved through review of construction and development plans to ensure that the site is accessible to fire trucks, has sufficient fire hydrant capacity, proper chemical storage and that employees are safe in the building. The Fire Department also performs ongoing inspections of existing space to ensure safety and compliance, including on-site hazardous materials storage (quantity and type). The inspections also include reviews of identified escape routes and potential employee safety hazards. The Police Department verifies addressing and building layout to guarantee access to the building in a timely manner in the event of an emergency. In addition, all businesses with alarms must have an alarm permit, which can be obtained from the Chandler Police Department. Permits and all information on fees and schedules can be obtained at the Chandler Police Department website. Utilities The Permit Counter staff is the main contact for all types of utility improvements, including temporary power service required during construction. Staff coordinates new utility installation orders and utility service relocations. 35 2009 Small Business Guide Establishing Your Location :: Further Resources Zoning & Development Review Information Chandler Economic Development Division Office Location: Phone: 480.782.3030 215 E. Buffalo St. Fax: 480.782.3040 Suite 105 Web: www.chandleraz.gov/ed Chandler, AZ 85225 City of Chandler - Current Planning Division Office Location: Phone: 480.782.3051 215 E. Buffalo St. Fax: 480.782.3075 Suite 103 Web: www.chandleraz.gov Chandler, AZ 85225 Permitting Information City of Chandler - Permit Counter Office Location: Phone: 215 E. Buffalo St. Fax: Lobby Chandler, AZ 85225 480.782.3000 480.782.3055 Inspections City of Chandler - Building Inspections Office Location: Phone: 480.782.3101 215 E. Buffalo St. Fax: 480.782.3009 Basement Chandler, AZ 85225 Fire & Police City of Chandler - Fire Department Office Location: Phone: 221 E Boston St Web: Chandler, AZ 85225 480.782.2121 www.chandlerfire.org City of Chandler - Police Department Office Location: Phone: 250 E Chicago St Web: Chandler, AZ 85225 480.782.4520 www.chandlerpd.com 36 2009 Small Business Guide Establishing Your Location :: Further Resources Utilities City of Chandler Water & Sewer 975 Armstrong Way Chandler, AZ 85225 Phone: 480.782.3700 City of Chandler Trash & Recycling 955 E Queen Creek Rd Phone: Chandler, AZ 85225 480.782.3510 Electric Salt River Project Arizona Public Service (Downtown area only) Natural Gas Southwest Gas Corporation Phone: Toll Free: Website: 602.236.8833 800.258.4SRP (4777) www.srpnet.com Phone: Toll Free: Website: 602.371.6767 800.253.9407 www.aps.com Industrial Phone: Commercial Phone: Toll Free: Web: Telecommunications (Internet & Phones) Qwest Small Business Toll Free: Website: Cox Communications Phone: Toll Free: Website: 602.375.4082 602.861.1999 877.860.6020 www.swgas.com 800.603.6000 www.qwest.com 623.322.2000 866.456.9944 www.cox.com 37 2009 Small Business Guide Doing Business in Chandler :: Tax & Licensing Chandler Tax & Licensing Services City of Chandler special regulatory licenses are required for a number of business types. Please refer to the City of Chandler’s Tax & Licensing Division for more information. Fingerprints, photographs and background checks may be required. Chandler Business License Every business that operates in the City of Chandler is required to have a City Business License and applicable state and federal licenses. Any business proposed to be located within the city limits — except real property rentals — must have obtained location approval from Development Services. Commercial locations are required to have a Certificate of Occupancy. Home-based locations are required to have Zoning Clearance. Liquor License Liquor licenses are regulated by the Arizona Department of Liquor Licenses and Control. Applications filed with the state are forwarded to the city for approval. City processing fees include a non-refundable $200 application fee, a $200 issuance fee, and annual license fees ranging from $300 to $1,000, depending on the type of license. The process for approval includes posting a notice at the proposed business location for a period of 20 days and zoning approval. The application is then presented to the City Council for consideration. A Use Permit through the Planning and Development Department may be required, which can take as many as 60 days. Therefore applying for a Use Permit before Liquor License is recomended. The City of Chandler has 60 days after the filing date with the Department of Liquor to recommend approval or denial of the application. The State Liquor Board receives the City’s decision and either approves or denies the application. 38 2009 Small Business Guide Doing Business in Chandler :: Tax & Licensing Transaction Privilege (Sales) Tax The City of Chandler imposes a tax rate of 1.5%, 1.8%, 2.75%, and 2.9% privilege tax on the gross business income of certain types of business activity (less allowable deductions). This tax is more commonly known as the sales tax paid by customers when purchasing products and services. Businesses are required to collect this tax and periodically distribute proceeds to the City. The tax rate Chandler collects is currently the lowest in the Phoenix Metro area. The following business activities are subject to privilege (sales) tax: advertising, amusements, construction contracting, job printing, mining, timbering and other extraction, publishing and other periodical distribution, rental, leasing and licensing for use of real property, rental or leasing to transients, rentals, leasing and licensing for use of tangible personal property, restaurants and bars, retail sales, telecommunication services, transporting for hire and utility services. Tax returns are generally due monthly on the 20th of the month following a reporting period. Quarterly or annual reporting options may be allowed based on the provisions in the tax code. All requests for a change of reporting frequency must be submitted in writing. Use Tax Use tax is a tax on purchases or rentals for storage or use within the city, on which an equivalent excise tax has not been paid. The tax is not on inventory held for resale, but if goods were purchased for resale and later removed from inventory for use by that business, use tax would apply. If goods are purchased in a city where the local tax rate is higher than 1.5%, then no use tax is due. Transient Occupancy Tax Additional tax on transient lodging. Hotels and similar businesses who offer lodging for less than thirty (30) consecutive days must collect the 1.5% real property rental tax, an an additional transient lodging tax of 2.9%. Therefore, the total tax on transient lodging equals 4.4%. 39 2009 Small Business Guide Doing Business in Chandler :: Tax & Licensing Restaurant & Bar Tax The tax rate for restaurants and bars is 1.8%. The tax is applicable to preparing and serving food or beverages for on or off-premise consumption, including cover charges. Caterers are taxed according to their location, not the catering site. Delivery, set-up and clean-up fees separately charged and maintained are exempt from catering income. Sales to nonprofit hospitals and public school cafetarias are exempt. Telecommunication Services Tax The tax rate is 2.75% and is charged on subscriptions to, or access fees for one-way or two-way voice, sound, or video transmissions, facsimile transmissions, relay or repeater service, computer interface over a communications channel, computer time-sharing, and security or alarm system monitoring. Telecommunications for resale and interstate transmissions are exempt. Utility Services Tax The tax rate is 2.75% and is charged to city rate-payers on water, electricity, and natural gas. Excluded are resales and sales to nonprofit hospitals. NOTE: This information is meant to be a guideline only. For complete details, refer to the City of Chandler Tax Code and related regulations. In case of inconsistency or omission in this publication, the language of the tax code will prevail. For more information contact the City of Chandler Licensing & Tax Division at 480.782.2280. 40 2009 Small Business Guide Doing Business in Chandler :: Tax & Licensing Arizona Tax & Licensing Services The Phoenix Metropolitan Area is consistently chosen as one of the top places in the country to start and grow a business. The State of Arizona encourages the development of successful businesses by maintaining a favorable tax system. The state agency that administers the tax system is the Arizona Department of Revenue. In order to make the determination of which state taxes your business will be required to pay as easy as possible, the state has developed a single form application. This application is called the Arizona Joint Tax Application published by the Department of Revenue. After completing this application the Arizona Departments of Revenue and Economic Security determine which taxes and licenses apply to your business type and legal structure. This application will cover the following license and registration requirements: • • • • Transaction Privilege (Sales) Tax Use Tax Withholding and Unemployment Taxes Wholesale Tobacco Dealer’s License • • • • Liquor Wholesalers, Microbreweries, Farm Wineries and Cider Products Corporate Income Tax Property Taxes Unemployment Insurance * These taxes and licenses are described in detail at www.azcommerce.com/smallbiz, hosted by the AZ Dept. of Commerce. Federal Taxes - Internal Revenue Service The Internal Revenue Service (IRS) provides assistance to business owners with questions regarding tax rules and regulations. Specific questions should be directed to the IRS. 41 2009 Small Business Guide Doing Business in Chandler :: Environmental Environmental Issues Whether constructing a new building or occupying an existing one, an environmental assessment of the property may need to be completed prior to construction of the project. Planning & Development staff will be able to assist you to ensure that the correct assessments are completed. US Environmental Protection Agency The agency conducts environmental assessment, research, and education. It has the primary responsibility for setting and enforcing national standards under a variety of environmental laws, in consultation with state, tribal, and local governments. It delegates some permitting, monitoring, and enforcement responsibility to US states and Native American tribes. EPA enforcement powers include fines, sanctions, and other measures. The agency also works with industries and all levels of government in a wide variety of voluntary pollution prevention programs and energy conservation efforts. Arizona Department of Environmental Quality The Compliance Assistance Program is designed to help small businesses comply with the environmental regulations that govern the State of Arizona. This special program will coordinate many facets of environmental compliance and is separate from the inspection and enforcement divisions. Maricopa County Air Quality Department Business Resource Center (BRC) This program is directed by the Maricopa County Environmental Services Department and assists small businesses that are or will be subject to the requirements of the 1990 Federal Clean Air Act Amendment. This free program uses education and technical assistance to help small businesses comply with environmental regulations while promoting health, safety and environmental benefits. In addition, the program assists small businesses through the environmental permit process, pollution prevention strategies and solutions and site evaluations. 42 2009 Small Business Guide Doing Business in Chandler :: Environmental Maricopa County Environmental Services Department The Environmental Services Department is responsible for the health and safety of the community by preventing and removing environmental risks. The Department’s Environmental Health Specialists help to improve air quality, ensure that food in eating establishments is free of contamination and ensure that water supplies throughout the county are safe to drink. Maricopa County Environmental Health Division Any establishment, which serves food or drinks, is required to obtain an Eating and Drinking Permit from the Environmental Health Division. The establishment must also be in compliance with Maricopa County Environmental Health Division for all food service facilities and food handlers. Chandler Municipal Utilities Department - Environmental Resources City of Chandler staff is available to offer guidance and compliance support to businesses locating in Chandler. Education programs are also available through this department. Chandler Fire Department The Chandler Fire Department helps ensure the compliance of businesses and the safety of their employees by conducting routine fire inspections of commercial businesses and by reviewing building improvements, and the construction plans of new or existing facilities. The Hazardous Materials Team is responsible for the hazardous materials program and inspections. 43 2009 Small Business Guide Doing Business in Chandler :: Further Resources Tax & Licensing Information Chandler Tax & License Division 55 N Arizona Pl Phone: Suite 201 Web: Chandler, AZ 85225 480.782.2280 www.chandleraz.gov/tax Arizona Department of Liquor Licenses & Control 800 W Washington St Phone: 602.542.5141 Suite 500 Web: www.azliquor.gov Phoenix, AZ 85007 Arizona Department of Revenue Main Office: Corporate Income Taxes: 1600 W Monroe St 1st Floor New Businesses & Licensing: Phoenix, AZ 85007 Problems & Resolutions: To Order Forms: Web: 602.225.3381 602.255.2060 602.716.6025 602.542.4260 www.azdor.gov Internal Revenue Service - Taxpayer Education & Communication 210 E Earll Dr Phone: 602.207.8031 Phoenix, AZ 85012 Web: www.irs.gov/businesses/small Environmental Information Environmental Protection Agency US EPA - Region 9 Phone: 75 Hawthorne St Toll Free: San Francisco, CA 94105 Web: 415.947.8000 866.EPA.WEST www.epa.gov/region09 Arizona Department of Environmental Quality Phoenix Main Office Phone: 602.771.2300 1110 W Washington St Toll Free: 800.234.5677 Phoenix, AZ 85007 Fax: 602.771.4436 Web: www.azdeq.gov Maricopa County Environmental Services Department 1001 N Central Ave Phone: 602.506.6623 Suite #200 Fax: 602.506.5141 Phoenix, AZ 85004 Web: www.maricopa.gov/envsvc 44 2009 Small Business Guide Doing Business in Chandler :: Further Resources Maricopa County Air Quality Department Business Resource Center (BRC) 1001 N Central Ave Phone: 602.506.5102 Suite #400 Fax: 602.372.0997 Phoenix, AZ 85004 Google Search Terms: maricopa air quality business Maricopa County Environmental Health Division 1001 N Central Ave Phone: 602.506.6980 Suite #300 Fax: 602.506.6862 Phoenix, AZ 85004 Web: www.maricopa.gov/envsvc/ envhealth Chandler Municipal Utilities Department - Environmental Resources 975 E Armstrong Way Phone: 480.782.3582 Building L Fax: 480.782.3805 Chandler, AZ 85248 Web: www.chandleraz.gov City of Chandler - Fire Department 221 E Boston St Phone: Chandler, AZ 85225 Fax: Web: 480.782.2121 480.782.2125 www.chandlerfire.org Trade Information Better Business Bureau of Central/Northern Arizona 4428 N 12th St Phone: 602.264.1721 Phoenix, AZ 85014 Toll Free: 877.291.6222 Fax: 602.263.0997 Web: www.central-northern-westernarizona.bbb.org Grand Canyon Minority Supplier Development Council (GCMSDC) 340 E Palm Lane Phone: 602.495.9950 Suite A-100 Fax: 602.495.9943 Phoenix, AZ 85004 Web: www.gcmsdc.org Bid Source (Maricopa County) 201 N Central Ave Phone: Suite 2700 Fax: Phoenix, AZ 85072 Web: 602.495.6467 602.495.8913 www.bidsource.com 45 2009 Small Business Guide Labor Regulations Industrial Commission of Arizona :: Department of Labor The Arizona Department of Labor* is responsible for administering the state’s laws relating to labor. These statutes include the payment of wages, employment practices, child labor and the licensing of some agencies. Posting Requirements Companies must comply with Federal and Arizona laws requiring that mandatory notices be posted in a conspicuous place that is frequented by employees and/or applicants. Copies of these posting notices can be obtained for a fee from the Arizona Employers’ Council* (See below). Notices are also available on their Web site at www.azeci.com. The following is a list of required postings: Federal Notices Department of Labor • • • • • • • • • • • • • Age Discrimination in Employment Act Americans with Disabilities Act Civil Rights Act of 1964 (Title VII) Employee Polygraph Protection Act Equal Pay Act of 1963 Equal Opportunity Employment Fair Labor Standards Act Family and Medical Leave Act of 1993 Uniformed Services Employment & Reemployment Rights Act Federal Minimum Wage Government Contractors Federally Financed Construction Migrant and Seasonal Agricultural Protection Arizona Notices Equal Opportunity Employment Commission • • • • • Arizona Minimum Wage Constructive Discharge Employment Discrimination Unemployment Insurance Workers Compensation ADOSH - Arizona Occupational Safety & Health Administration • ADOSH - State • Workplace Exposure to Bodily Fluids • Hazmat (hazardous materials) Information & Emergency Data OSHA - Occupational Safety & Health Administration • OSHA - Federal • OSHA Summary (Form 200) • Occupational Notice *See Further Resources for contact information 46 2009 Small Business Guide Labor Regulations Fair Labor Standards Act The Fair Labor Standards Act (FLSA) is administered by the Wage and Hour Division of the U.S. Department of Labor. The law establishes minimum wage, overtime, and child labor standards for employers. The Arizona Labor department has jurisdiction over all businesses in the state, which are not covered by the FLSA. To determine if your business is subject to the FLSA please contact the US Department of Labor. Wage Payment Laws Every employer in the state must have at least two regular paydays each month not more than 16 days apart. Arizona law permits five working days between the end of a pay period and the payment of wages earned during that pay period. An employee who is discharged must receive all wages due within three working days. If an employee quits, the employee must be paid all wages no later than the regular pay day. Minimum Wage In Arizona the minimum wage as of January 1, 2009 is $7.25. Legislation Right to Work Legislation Arizona is a right to work state, which means no person shall be required to join a labor union as a condition of obtaining or retaining employment. Safety Regulations The Industrial Commission of Arizona, under the Occupational Safety and Health Act of 1970, is the state agency charged with regulating industrial facilities for fire, health and safety requirements. For information contact the Industrial Commission of Arizona, Division of Occupational, Safety and Health.* Discrimination in Employment Title VII of the Civil Rights Act of 1964 is the federal law which prohibits employment discrimination based on race, color, religion, sex or national origin. For additional information please contact the US Equal Employment Opportunity Commission.* Immigration & Nationality Act The Immigration and Nationality Act (INA) prohibits employers from knowingly hiring undocumented workers. It also requires employers to verify their employee’s identity and work eligibility specified on the 47 2009 Small Business Guide Labor Regulations I-9 form. For additional information please contact the Office of Special Council for Immigration-Related Unfair Employment Practices.* Arizona Workers’ Compensation Insurance Public and private employers must carry workers’ compensation insurance if they employ “regularly employed workers”. Regularly employed includes all employment whether continuous throughout the year or for only a portion of the year. The purpose of workers’ compensation insurance is to provide medical benefits and/ or compensation to a covered employee who is injured by an accident arising out of and in the course of their employment. The insurance must be covered at the employer’s expense. Companies may choose to insure their employees in one of three ways: 1. State Compensation Fund* 2. Insuring with an authorized carrier 3. Qualifying as a self-insurer under the rules and regulations of the Arizona Industrial Commission* Defining Employee/Independent Contractor Status An employer is responsible for withholding and remitting state and federal income taxes, Social Security and Medicare taxes, paying unemployment and workers’ compensation insurance and the employer’s matching Social Security and Medicare tax. In the case of an independent contractor, a company does not withhold or pay the above items from payments for work performed. According to the IRS, “The general rule is that an individual is an independent contractor if you, the employer, have the right to control or direct only the result of the work and not the means and methods of accomplishing the result.” For additional assistance, please contact the Internal Revenue Service, Arizona Department of Economic Security, an attorney or accountant. For information on any of these topics listed above, please contact the Arizona Employers’ Council Inc.* *See Further Resources for contact information 48 2009 Small Business Guide Labor Regulations :: Further Resources Labor Information Arizona Department of Labor 800 W Washington St Phoenix, AZ 85007 Phone: Web: 602.542.4515 www.ica.state.az.us/Divisions/ labor US Department of Labor - Employment Standards Administration Wage & Hour Division 230 N First Ave Phone: 202.693.5000 Suite 402 Toll Free: 800.4.USA.DOL Phoenix, AZ 85003 Web: www.dol.gov/esa Arizona Industrial Commission - Division of Occupational Safety & Health 800 W Washington St Phone: 602.542.5795 Phoenix, AZ 85007 Web: www.ica.state.az.us/Divisions/ osha US Equal Employment Opportunity Commission 3300 N Central Ave Toll Free: 800.699.4000 Suite 690 Fax: 602.640.5071 Phoenix, AZ 85007 Web: www.wwoc.gov/phoenix Office of Special Counsel for Immigration-Related Unfair Employment Practices 950 Pennsylvania Ave Toll Free: 800.255.8155 Washington, DC 20530 Web: www.usdoj.gov/crt/osc/ State Compensation Fund 3030 N 3rd St Phoenix, AZ 85012 Phone: Toll Free: Fax: Web: 602.631.2600 800.231.4453 602.631.2065 www.statefund.com Arizona Industrial Commission - Special Fund 800 W Washington St Phone: 602.542.3294 Phoenix, AZ 85007 Fax: 602.542.3104 Web: www.ica.state.az.us/divisions/ specialfund Arizona Employers’ Council, Inc. 18777 N 32nd St Phone: Suite 90 Fax: Phoenix, AZ 85050 Web: 602.955.7558 602.955.4545 www.azeci.com 49 2009 Small Business Guide Source: Arizona Entrepreneur’s Edge Appendix :: State Financial Incentives Table 50 2009 Small Business Guide Source: Arizona Entrepreneur’s Edge Appendix :: State Financial Incentives Table Continued 51 2009 Small Business Guide Appendix :: Glossary of Terms Annexation The process of incorporating county islands into the City of Chandler Breakeven Analysis A projection of expenses and income to determine when you company will not longer run deficits Capital investors People or companies who invest money in a company Case planner Planning staff member who is assigned a zoning or development project Certificate of occupancy (CofO) This certifies that the business owner has completed all city processes and can begin business operations in their space Demographics Information about a community or area such as average age or income that can be used to choose a location near your target market Development policies Tools used to implement the goals and objectives of the General Plan. These policies guide City Council when making rezoning and other development decisions. New developments should consult applicable development policies and follow the guidelines within. DPA Development Project Administrators are your single point of contact for all city development processes Environmental assessment An assessment of the possible impact—positive or negative—that a proposed project may have on the natural environment. The purpose of the assessment is to ensure that decision makers consider the ensuing environmental impacts to decide whether to proceed with the project. Equity bartering Part ownership in a company is given in lieu of monetary payment License agreement A license agreement defines the terms under which a resource or property such as petroleum, minerals, patents, trademarks, and copyrights are licensed by one party to another Licensing Businesses need to gain the proper registration and permission to operate their business. A license signifies that this has been done. Minimum wage Lowest possible wage a worker can receive (tips can also count toward this wage) Operating procedures An organization’s policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental regulations. Payment of royalties Usage-based payments made by one party (the “licensee”) to another (the “licensor”) for ongoing use of an asset, sometimes an intellectual property (IP) right Permitting This is initial permission to build or change something which is followed up with inspections during and after project completion 52 2009 Small Business Guide Appendix :: Glossary of Terms Preliminary Development Plans A plan that provides a general design concept and layout for a proposed development. Most rezoning requests also require a preliminary development plan to accompany the zoning application. Preliminary Development Plans and rezoning requests require City Council approval. Presite tech review A pre-conceptual look at a site plan to look at big picture issues Right to Work state Employment cannot be denied or terminated if an employee does not with to join a union Setbacks The area that must be kept clear of buildings/ structures. For example, most residential properties have a 10’ rear setback. This means that no buildings will be allowed to be built that are located within 10’ of the rear property line. Signage The amount and/ or size of signs to be allowed on a particular site/ building. All signs require a sign permit through the Planning and Development Department. Target market The people or companies for whom your product is designed provides compensation medical care for employees who are injured in the course of employment, in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence Use Permit A permit that allows a land use that is otherwise not permitted within a specific zoning district. Use Permits require approval by City Council. Variance A deviation from a regulation within the Zoning Code, such as setback regulations. Variances must be approved by the Board of Adjustments and can only be approved if there is some irregular circumstance that applies to the property, such as an irregular lot shape. Workers’ compensation insurance Provides compensation medical care for employees who are injured in the course of employment, in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence Zoning The division of a city into areas (zones), specifying the land uses (i.e. residential, commercial, industrial, office, etc.) allowable for the property in these areas and the regulations associated with the development of these properties (i.e. maximum building height, maximum density, etc.) Zoning code The written, official language describing permitted land uses, found in www.municode.com Zoning Code amendments/ Modifications to the Zoning Code. zoning change 53 2009 Small Business Guide Appendix :: Index Age Breakdown Angel Investment Arizona Department of Commerce Office of Innovation & Technology Small Business Services Workforce Recruitment & Job Training Program Arizona Department of Environmental Quality Arizona Department of Labor Arizona Department of Liquor License & Control Arizona Department of Revenue Arizona Employee Wage Index Arizona Employers’ Council Arizona Fast Program Grant Arizona Hispanic Chamber of Commerce Arizona Industrial Commission Division of Occupational Safety & Health Arizona Industrial Commission Special Fund Arizona Minority Business Development Center Arizona Occupational Safety & Health Administration (ADOSH) Arizona Public Service (APS) Arizona Secretary of State Arizona Small Business Association Arizona Small Business Development Center Arizona State Compensation Fund Asian Chamber of Commerce ASU - Arizona State University Career Services Office Advanced Technology Innovation Center Center for Competitiveness & Prosperity Research 5 28, 50 7, 10 30 14, 22, 30 12, 14, 28, 50 42, 44 46, 47, 49 38, 44 41, 44 4 48, 49 28, 50 16 47, 48, 49 47, 49 25, 29 46 37 20, 22 16 22, 25, 29 48, 49 16 11, 15 12, 15 15 54 2009 Small Business Guide Center for Services Leadership JP Morgan Economic Outlook Center L. William Seidman Research Institute Office of Economic Affairs Realty Studies Spirit of Enterprise Center Technology Enterprises Technopolis Business Development Finance Corporation business license business plan CDC Small Business Finance certificate of occupancy City of Chandler Diversity Office Economic Development Division Fire Department Municipal Utilities Department Environmental Resources Planing & Development Department Building Inspections Current Planning Division Interdisciplinary Small Business Interaction Team Permit Counter Police Department Public Library Tax & License Division Trash & Recycling Water & Sewer Chandler Chamber of Commerce 15 15 11, 15 12, 15 15 11-12, 15 12, 15 12, 15 25, 29 38 18, 19 25, 29 35, 52 9 7, 8, 14, 22, 30, 31, 32, 33, 34, 36 35, 36, 43, 45 43, 45 9, 14, 32, 33, 42 36 36 9, 14 36 35, 36 8-9, 14 38, 40, 44 37 37 7, 10, 16, 41 Appendix :: Index Chandler-Gilbert Community College Chinese Chamber of Commerce Commerce & Economic Development Commission (CEDC) Commercial & Economic Solar Tax Credit corporate income tax corporation corporation, C corporation, S Cost of Living Index Cox Communications development project administrator (DPA) Education Levels Enterprise Zone Equal Opportunity Employment Commission Grand Canyon Minority Supplier Development Council (GCMSDC) Greater Phoenix Black Chamber of Commerce Greater Phoenix Chamber of Commerce Greater Phoenix Economic Council (GPEC) home based business limited liability company liquor license Maricopa County Air Quality Department Business Resource Center Bid Source Environmental Health Division Environmental Services Department Maricopa Workforce Connections Market Assessment Grant minimum wage 12, 16 16 28, 50 51 41 18 18, 21 18, 21 4 37 34, 52 5 28, 50, 51 46 45 16 16 7, 17 32, 33 20, 21 38 42, 45 45 43, 45 43, 44 13, 14 28, 51 47, 52 National Center for American Indian Enterprise Development Neighborhood Economic Development Corporation (NEDCO) partnership partnership, general partnership, limited partnership, limited liability posting requirements Prestamos property tax Qwest Small Business Race & Ethnicity Research & Development Tax Credit restaurant & bar tax sales tax - see transaction privilege tax Salt River Project (SRP) Service Corps of Retired Executives (SCORE) Small Business Association (SBA) sole proprietorship Southwest Gas Corporation Technology Assessment Grant telecommunication service tax transaction privilege tax transient occupancy tax United States Department of Labor Environmental Protection Agency Equal Employment Opportunity Commission Internal Revenue Service Occupational Safety & Health Administration (OSHA) Office of Special Council for Immigration-Related Unfair Employment Practices 25, 29 25,29 18 20, 21 20, 21 20, 21 46 25, 30 41 37 4 28, 51 39-40 37 22, 25, 30 22, 25, 26-27, 30 18, 20, 21 37 28, 51 40 38,41 39 47, 49 42, 44 47, 49 41, 44 46 48, 49 55 2009 Small Business Guide Appendix :: Index US Women’s Chamber of Commerce use permit use tax utilities utility service tax wholesale tobacco dealer’s license Workforce Breakdown zoning change zoning code 17 32, 33, 53 39, 41 35, 37 40 41 6 32, 33, 34, 53 7, 9, 18, 31, 53 56 2009 Small Business Guide