Today, the Utah Governor’s Office of Economic Opportunity (Go Utah) awarded Vitalpax, Inc. a temporary, marginal tax reduction for its expansion in rural Utah. As part of the agreement, Vitalpax plans to bring up to 40 new high-paying jobs and invest $5 million in rural Utah during the next 10 years.
This post-performance corporate incentive is part of the Legislature’s Economic Development Tax Increment Finance (EDTIF) program. Eligible companies work with the Economic Opportunity office to outline performance criteria. Once the office confirms those criteria have been met, according to statute (U.C.A. 63N-2-106(2)), companies can receive a refund of a percentage of the new, additional state taxes they paid until their contract expires.
Utah does not provide up-front cash for corporate retention and recruitment. Instead, the state offers a post-performance tax credit after the company meets specific obligations, including capital investment, new high-paying jobs, and additional state tax payments.
By locating in La Verkin, Vitalpax is eligible for the rural modifications of the state’s EDTIF tax credit program. Tax credits are approved by Go Utah’s governor-appointed executive director, with advice from the Go Utah Board and support from local communities. The tax credit program operates under legislative statute and the Cox-Henderson administration’s vision for economic opportunity for all Utahns.
“We’re excited to see Vitalpax continue to grow in La Verkin, Utah,” said Dan Hemmert, the Office of Economic Opportunity’s executive director. “The company’s dedication to its local community has been obvious throughout our discussions, and we wish Vitalpax continued success.”
Vitalpax is a Utah company specializing in contract manufacturing of dietary nutritional supplements. The current services provided are start-to-finish research and development, testing, sourcing and procurement, manufacturing, and delivering the final nutritional supplement product. These can include delivery forms such as tinctures, capsules, tablets, powders, juices, and more.
“Vitalpax has a phenomenal team of skilled leaders and experts within the dietary supplements industry,” said Dalyon Ruesch, CEO of Vitalpax. “With our combined 75 years of experience in contract manufacturing, we have created a full turnkey solution where clients can get everything they need to build a successful brand in one place.”
Vitalpax may receive up to 30% of the additional state taxes it will pay over the 10-year life of the agreement in the form of a Utah Legislature-authorized Rural Economic Development Tax Increment Finance (REDTIF) tax credit. Each year that Vitalpax meets the criteria in its contract with the state, it will qualify for a portion of the total tax credit.
“Vitalpax has been a mainstay in Washington County, and its manufacturing and distribution expansion will continue to diversify the City of La Verkin’s economy,” said Theresa A. Foxley, president and CEO of the Economic Development Corporation of Utah. “The expansion is well aligned with Gov. Cox’s goal to encourage job growth and investment across the entire state.”
Go Utah tracks incented companies in a dashboard available on this webpage. The public data show when the tax credit was awarded and the numbers of promised jobs, new state wages, new state revenue, projected capital investment, and the maximum tax credit. It reports the term of the contract and the temporary, marginal tax reduction the company may receive if it meets its obligations. The table also shows whether the company has an active agreement, the percentage of new state revenue assessed, and the total tax credit used.
Since EDTIF’s 2005 inception, about 50% of companies awarded an incentive have pursued a post-performance tax credit by entering into a contract with the state. The Utah Legislature authorized the REDTIF modifications beginning in July 2021 to increase business expansion and recruitment opportunities throughout the state’s rural communities.
The REDTIF modifications provide an efficient and effective way for rural Utah to engage in corporate retention and recruitment while ensuring taxpayers receive value from the limited tax credits offered. These modifications support the country’s leading economy and provide economic opportunities for Utahns.
Tax Credit Projections
|Capital investment:||$5 million|
|Projected new state tax revenue:||$1,064,656|
|REDTIF new state tax credit:||30%|
Learn more about the state’s post-performance REDTIF modifications here.