City Council Study Session Agenda and Packet 2012 02 13

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PAGE THREE SUBJECT: DISCUSSION — BUSINESS ASSISTANCE PROGRAM DATE: FEBRUARY 13, 2012 Tangible goods include, by way of example, computers, furniture, fixtures, appliances, electronics, and does not include, by way of example, food, office supplies or other consumable goods not expected to last for three or more years. The City Council's decision of whether to provide any kind of BAP incentive is an exercise of legislative discretion, based on the ability of the applicant to meet the following criteria: • Brings high quality development • Retains basic jobs to the City • Retains existing sales tax to the City • Creates new sales tax to the City • Utilizes an existing building(s) • Complements existing Louisville businesses (i.e. a buyer or supplier that serves an existing business in the City) • Brings new basic jobs to the City • Represents redevelopment to an area or building in the City • Represents job diversity in industry sectors and is part of a growing industry • Represents retail diversity • Brings a value added result to the City or a development within the City (i.e. moves the company's corporate headquarters to the City) • The percentage of the incentive relative to the new revenue generated by the company • The conformance of the applicant's property or project with the comprehensive plan, zoning ordinances and building codes of the City The application of the Council's discretion depends on the Council's ability to understand the individual nature of each application. The Council needs to be especially aware of the overall economic environment. It is much riskier to start a new enterprise or expand a business during hard times; therefore a more liberal interpretation of the criteria may be warranted. A formal legal agreement is required to be signed by the applicant and the City. The elements of the agreement are defined in the code. One of the difficulties that political bodies have in discretionary matters like this is dealing with the fairness question. Why do we provide incentives from now on, and not to the historical businesses that located here prior to the program's inception? Another issue that often comes up is a concern about incentivizing competition, and creating "un- level" playing fields. The answer to the first is an issue common to all programs that are not retro- active. The answer to the second is that, while the City Council is not charged with protecting today's businesses from healthy competition, staff tries to alert any existing businesses so that they can come speak before the Council at the meeting when the incentive is being considered. 19