Economic Vitality Committee Agenda and Packet 2021 08 20

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SUBJECT: BAP ANNUAL ANALYSIS DATE: AUGUST 20, 2021 PAGE 4 OF 5 to the City brought by the businesses. In addition to the one-time permit fee revenues, companies that have received incentives have also added significantly to the overall property valuation and continue to contribute to the Sales and Use Tax revenues that support City services. Several Key Performance Indicators (KPIs) are also referenced in the 2021 BAP Annual Report. These are similar to the efficiency indicators that are part of the Economic Prosperity Program KPIs, reported through the budget process. Again, for this data, staff is only employing companies that have completed business assistance agreements. These indicators are all calculated on the job and revenue data previously presented as compared to the amount of BAP dollars paid to -date, as described below. • For each dollar of incentives paid, companies added $24.11 of project construction valuation, which ultimately positively impacts the assessed valuation of the community and property tax dollars collected by the City. • For each job created in Louisville, the City paid approximately $2,786 in incentives. For each job retained in Louisville, the City paid approximately $2,716 in incentives. For each dollar of incentives paid, the City received back $.35 in Sales and Use Tax revenues in 2020. Since not all companies receiving incentives are typical tax generators, the calculation is also provided for retail businesses receiving incentives: $.96 per dollar of incentives paid. Other Program Information There is an extremely high volume of new business prospect activity at this time, both in the retail and industrial sectors. Staff is fielding on average five to six inquiries a week. Time is spent with each business that inquires to learn more about the business project and to provide information about eligibility for the program incentives. Many inquiries result in staff preparing an estimate of potential incentives and then some of those advance for Council consideration. As part of Strategic Plan Item #1-2, staff developed new materials to assist in marketing the Business Assistance Program and providing consistent information to potential applicants. So far, the materials have been well received. Depending on the outcomes of the program evaluation currently underway, staff may need to edit those materials and educate commercial property owners, brokers, and business prospects on any changes. Program changes would also be developed into a new application package, which staff has not yet revised extensively due to the timing of the program evaluation. Staff also maintains a webpage showing recently approved assistance agreements and the program materials. RECOMMENDATION: Review the annual analysis of the Business Assistance Program and provide staff with questions and feedback. Agenda Packet P. 10