HomeMy WebLinkAbout7A - Business Assistance Policy
MEETING DATE:
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DISCUSSION:
ALTERNATIVES:
RECOMMENDED
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ECONOMIC DEVELOPMENT AUTHORITY
CITY OF PRIOR LAKE
DECEMBER 20, 1999
7A
DONALD RYE, PLANNING DIRECTOR
CONSIDER APPROVAL OF BUSINESS ASSISTANCE
POLICY
At the last EDA meeting, discussion was had concerning the
need for a Business Incentives policy which satisfied State
statute requirements for such a policy. Staff was directed to
draft a policy which was consistent with the County policy
recently adopted by the County Board.
Attached is a draft of a Business Assistance policy which is
consistent with, and in most respects identical to, the adopted
County policy. .
It is recommended the EDA recommend the draft policy for
adoption by the City Council.
1. Recommend adoption of the draft policy by the City Council
2. Refer the draft policy back to staff for such modifications as
may be deemed appropriate.
Motion to recommend adoption of the proposed Business
Assistance Policy to the City Council
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16200 Eagle Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
ECONOMIC DEVELOPMENT INCENTIVES POLICY
Introduction
This Policy is adopted for purposes of the Business Subsidies Act (the "Act), which is
Minnesota Statutes, Sections 116J.995 through 116J995. Terms used in this Policy are
intended to have the same meanings as used in the Act. A business subsidy, as defined in
Minn. Stat. 116J.993(3), is herein referred to as an economic development incentive.
This Policy shall apply only with respect to incentives granted under the Act if and to the
extent required thereby.
The essence of this policy is to provide the legal and statutory framework for the City
Council to utilize economic development incentives pursuant to requirements in law. The
adoption of this policy is a prerequisite to determining the level of and extent of any
participation by the City of Prior Lake in economic development incentives programs.
Economic development incentives seek to realize goals that benefit the community, such
as the creation or retention of good paying jobs. Economic development projects may
also achieve other worthwhile goals. For instance, some projects provide value to the
community in the forms of infrastructure improvements, stabilization of business districts
or neighborhoods, or concentration of selected industries. While job creation and
retention goals will be required for any economic development project seeking incentives
pursuant to this Policy, the City can require that a project seek to achieve additional
goals.
The goals that economic development projects must pursue to receive incentives under
this policy are as follows:
. Job creation/retention
. Livable wages
. Job training
. Public infrastructure investment, and
. Stable communities
Specific goal targets for individual projects will be determined and agreed to between the
City and the requestor prior to approval of the economic development incentives by the
City Council.
Policies and Procedures
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16200 Eagle Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
1. The applicant will complete the City's Economic Development Incentives application
form (Exhibit 1) and submit a minimum deposit of$I,OOO which is non-refundable to
cover City administrative costs.
2. The requestor and the City will draft an economic development incentive agreement
for consideration by the City Council. When a tax abatement is requested, the
economic development incentive agre~ment will serve as the abatement agreement.
3. The agreement will include target goals that coincide to the economic development
goals identified in this policy. The recipient will report on the progress in achieving
agreement goals as prescribed by the business subsidies act.
Determination of Goal Targets
With respect to incentives, the following principles and criteria shall guide the
determination of goal targets:
· Each project shall be evaluated on a case by case basis, recognizing its importance
and benefit to the community from all perspectives, including created or retained
employment positions, infrastructure improvements, stabilization of communities,
and industry type.
· If a particular project does not involve the creation of jobs, but is nonetheless found to
be worthy of support and subsidy, it may be approved without any specific job or
wage goals, as may be permitted by applicable law.
· In cases where the objective is the retention of existing jobs, the recipient ofthe
subsidy shall be required to provide reasonably demonstrable evidence that the loss of
those jobs is imminent.
· The setting of wage and job goals must be sensitive to prevailing wage rates, local
economic conditions, external economic forces over which neither the City or the
recipient of the subsidy has control, the individual financial resources of the recipient
and the competitive environment in which the recipient's business exists.
Fiscal Limitations
· Total City contribution will be limited to the minimum level of assistance needed to
make the proposed project feasible and capable of achieving the agreed upon goals.
. Ifthe incentive is a tax abatement, the abatement will be on the taxes collected on the
value ofthe improvements (buildings) to the property; taxes collected on the value of
the land will not be abated.
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Because it is not possible to anticipate every type of project which may in its context and
time present desirable community building or preservation goals and objectives, the City
of Prior Lake retains the right in its sole discretion to approve projects and subsidies
which may vary from the principals and criteria of the Policy.
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