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C qty ot_ <br />Louisville <br />COLORADO • SINCE 1878 <br />CITY COUNCIL COMMUNICATION <br />AGENDA ITEM 5E <br />SUBJECT: <br />RESOLUTION NO. 35, SERIES 2015 —A RESOLUTION <br />APPROVING A BUSINESS ASSISTANCE AGREEMENT WITH <br />AQUAHYDREX, INC. FOR AN ECONOMIC DEVELOPMENT <br />PROJECT IN THE CITY OF LOUISVILLE <br />DATE: JUNE 2, 2015 <br />PRESENTED BY: AARON DEJONG, ECONOMIC DEVELOPMENT <br />SUMMARY: <br />Staff requests City Council action on a proposed Economic Development Business <br />Assistance Package (BAP) for the location of AquaHydrex, Inc's U.S. headquarters and <br />operations. The proposed business assistance is similar in nature to others recently <br />granted, including partial rebates on the building permit fees, construction use taxes, <br />and consumer use taxes for improving an existing building at 1797 Boxelder Street. <br />Staff estimates total revenues to the City from the project to be $742,000 and the value <br />of the proposed incentives are $478,900. <br />DISCUSSION: <br />AquaHydrex, Inc. is a Sydney, Australia renewable energy company that is developing <br />technology and equipment to split water into its hydrogen and oxygen components <br />through an efficient electrochemical system. Through a venture capital infusion from <br />True North Venture Partners out of Chicago, the company is looking to establish a U.S. <br />headquarters and operations location. <br />The Company is looking at 1797 Boxelder Street in the Colorado Technology Center for <br />this new project. They are also looking at locations in Broomfield County, as well as <br />Arizona locations. <br />AquaHydrex has significant tenant improvements and equipment purchases associated <br />with the potential location to 1797 Boxelder. The company estimates $1,500,000 - <br />$2,000,000 in tenant improvement costs to modify the building and $20,000,000 in <br />equipment purchases for their operations. <br />AquaHydrex has been awarded assistance from the State of Colorado through their <br />Strategic Fund program. The Strategic Fund incentives require a dollar for dollar match <br />from the local agencies and governments to show financial support for the project. The <br />State believes this project will help to advance the renewable energy industry in <br />Colorado, further promoting the strong economy in the State. City staff is proposing a <br />higher incentive than normal agreements to help leverage the state's investment in the <br />Company. Staff is proposing a 75% rebate of the building permit fees, construction use <br />taxes, and consumer use taxes. <br />CITY COUNCIL COMMUNICATION <br />45 <br />