Economic Vitality Committee Agenda and Packet 2024 06 21

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SUBJECT: DEVELOPMENT UPDATES DATE: JUNE 21, 2024 PAGE 8 OF 9 Colorado Springs, CO Alternative tax rate for manufacturing equipment Grand Junction, CO Manufacturing equipment Texas Manufacturing machinery and equipment Florida Machinery and equipment, PROPOSED BAP AMENDMENTS Staff is proposing the BAP be amended to allow for additional assistance for Boulder County's targeted industries. This additional assistance would be in the form of a rebate, up to 100%, of the sales and use tazes collected on machinery, machinery tools, software and property used in space flight. The following criteria would need to be met in order for a business to be considered for enhanced assistance: Must be a targeted industry (subject to verification of operations). Qualified expansion or retention The average wage of jobs must be at least 80% of the annual wage of Boulder County (not including benefits). A qualified expansion could include an increase in personnel and/or product lines. The company must provide proof of ability and intent to expand at the Louisville location to be considered a qualified expansion. The BAP is also a retention tool that can be used to keep companies in Louisville that may be exploring location options elsewhere. To qualify for an incentive as a retained business, the business would need to provide ample proof and due diligence that they are looking at relocating to a different community. This can be due to costs, expansion, business changes or other business factors, but proof must be provided showing the need to look for different sites and the competing sites. All BAP applications will continue to follow the existing application process that includes requiring the company to submit all needed information and verifications. EV staff will verify all applications for completeness and to confirm that all qualifications have been met. To ensure the stability of the program, a `claw -back' clause is included in the ordinance amendment so that in the event a project does not meet the agreement components (i.e., business operations for a 5-year period) the rebates would be returned to the City. This BAP amendment focuses on machinery, space flight property, and software due to the high - cost nature of these business components, even more so for specialized industries, product lines and business operations. The enhanced assistance would align Louisville's competitiveness with many of our direct competitors and continue to support a strong economy.