Economic Vitality Committee Agenda and Packet 2021 09 24

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SUBJECT: STRATEGIC PLAN ITEM #1-3 DATE: AUGUST 20, 2021 PAGE 7 OF 8 process and incentives are approved by the City Manager. Despite the program similarities, Boulder does not have any requirement around lease signing, but as noted, their program is much more heavily focused on retaining businesses that want to grow. A copy of Boulder's Flexible Rebate Incentive Program is included as Attachment #3. The City of Longmont also has an incentive program that captures rebates, exemptions, and development review. Staff was not able to confirm the specifics of how the program is administered. The City offers rebates of permit fees and City Sales Taxes to primary employers that are constructing new space or performing tenant improvements in existing space. Primarily employers are also eligible for a 50% rebate (for each of four years) on the City's portion of personal property taxes for new and expanding primary employers. Please note that primary employers may choose either the development fee rebates or the personal property tax rebates, not both. Longmont offers an exemption to new businesses on the 2% unrestricted local Sales and Use tax on the purchase and use of measurement and inspection equipment or R&D equipment for two years. Under certain circumstances, it appears the exemption could be extended for an additional three years. Lastly, Longmont offers an exemption on the City's 3.53% Sales and Use Tax on purchase of manufacturing equipment in excess of $1,000. The Town of Erie's Enhances Sales Tax Incentive Program (ESTIP) provides for its incentives outside of urban renewal opportunities that the Town also promotes. The program focuses on new or substantial expansion of retail Sales Tax generating businesses. To be eligible, a new or expanding business must generate $20,000 or more in sales tax within one year and the enhanced sales tax derived cannot exceed 50%. There appears to be a formal application process here as well, as the website notes a public hearing requirement, but staff was not able to confirm that factor. Additionally, Erie requires that the incentive dollars be used for public or public -related purposes, like public improvements or additional jobs for residents. BAP Criteria Based on the Committee's direction, it may also be helpful to review the existing program criteria. Even though these are not weighted or ranked, they help communicate the City's priorities to the business community. The Committee may wish to incorporate additional criteria that speak more to the goals and outcomes it wishes to incentivize. These items could also be re -worded or ordered more in a priority fashion. • Brings high quality development • Retains basic jobs to the City • Retains existing sales tax to the City • Draws NEW customers, and is not expected to draw a large percentage of its business from existing business • Creates new sales tax to the City • Utilizes an existing building • Complements existing Louisville businesses (i.e. a buyer or supplier that serves an existing business in the City) Agenda Packet P. 19