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SUBJECT: <br />INCENTIVE IDEAS <br />DATE: <br />SEPTEMBER 4, 2024 <br />PAGE2OF4 <br />previously -collected revenue back to existing businesses, how will the City make up for <br />that lost sales tax generation to the general fund? <br />Loan Program <br />Some communities create their own or partner with a financial organization to create a <br />loan program. This often takes the form of a revolving loan fund, and the fund can <br />provide loans to businesses at low or no cost. <br />The City would need to determine what types of businesses and projects could be <br />eligible for this type of incentive. Some common examples include a business <br />purchasing their property or a business expansion. The program could include <br />additional eligibility requirements such as business size and annual operating capital. <br />In order for a loan program to be successful, the City would need to determine program <br />eligibility and identify where the initial funds to start the program would come from, and <br />to what amount. <br />Rent Assistance <br />There have been conversations surrounding providing rent assistance to targeted <br />businesses in the City of Louisville to assist in the cost of operations. Rent assistance <br />could be provided to small businesses to help close the gap between what businesses <br />can reasonably charge for products and services, and current market rents. <br />The City would need to determine eligibility for the programs and program parameters <br />such as how much rent assistance (dollar amount, percentage, etc.) and length of time. <br />The City does not control market factors such as market rent and there would be no <br />way for the City to make sure that the rent for the property does not go up while <br />providing assistance. <br />An additional option for rent assistance would be one time grant assistance to help <br />cover the rent should the business have a slow month or face unforeseen expenses. <br />Economic Vitality Tax <br />Some communities enact a specific tax to be used for economic vitality/development <br />activities. This can include things like an addition to the sales tax (as the City of <br />Louisville has done with parks and historic preservation) or a lodging tax. In turn, these <br />funds could be used to fund economic development activities and programs, such as <br />incentives and other business support services. <br />Grant Programming <br />As currently structured, the City's incentive program is a rebate and performance -based <br />incentive program. This is common as it provides a share -back to the business while <br />protecting the City's financial interest and commitment to the project. <br />CITY COUNCIL COMMUNICATION <br />