Loading...
HomeMy WebLinkAbout03.25.13 EDA Packet °1.„mo^' AGENDA REGULAR ECONOMIC DEVELOPMENT AUTHORITY MEETING March 25, 2013 6:30 P.M. CITY COUNCIL CHAMBERS Todd Larson, Chair; Geraldine Jolley,Vice-Chair Douglas Bonar, Steve Wilson, Kirk Zeaman Action Taken 1. Call Meeting to Order 2. Pledge of Allegiance 3. Roll Call 4. Approve Agenda 5. Citizen Comments/Presentations 6. Consent Agenda a) Meeting Minutes (2/25/13 Regular)(2/28/13 Special) Approved 7. Public Hearings 8. Continued Business a) Appoint Business Attraction Team Members Appointed b) Business Subsidy Discussion Information Received 9. New Business 10. City Staff Reports/Open Forum/Discussion a) April Business Visit Schedule One Visit/Month b) Bank Summit Update (verbal) Discussed 11. Adjourn MINUTES ECONOMIC DEVELOPMENT AUTHORITY Regular Meeting February 25, 2013 1. CALL TO ORDER The meeting was called to order by Chair Larson at 6:30 p.m. Members Present: Larson, Bonar,Jolley, Wilson,Zeaman Members Absent: None Also Present: Lee Smick, City Planner; Cynthia Muller,Executive Assistant; Randy Distad,Parks and Recreation Director; Missie Kohlbeck, Senior Center Coordinator 2. PLEDGE OFALLEGIANCE 3. ROLL CALL 4. APPROVE AGENDA MOTION by Wilson, second by Larson to approve the Agenda. APIF,MOTION CARRIED. a) Organizational Matters i. Election of Officers MOTION by Jolley, second by Bonar to nominate Todd Larson as Chair. Voting for: Bonar,Jolley, Wilson,Zeaman. Abstain: Larson. MOTION CARRIED. MOTION by Wilson, second by Zeaman to nominate Jerri Jolley as Vice-Chair. Voting for: Larson, Bonar, Wilson, Zeaman. Abstain: Jolley. MOTION CARRIED. ii. Meeting Schedule EDA meetings will be held on the fourth Monday each month at 6:30 p.m. iii. Adoption of By-laws MOTION by Larson, second by Wilson to approve the by-laws as presented. APIF,MOTION CARRIED. 5. CITIZEN COMMENTS/PRESENTATIONS a) Ice for Tigers Ice for Tigers has been focused on bringing a second sheet of ice to the arena, working with several other organizations,the school district and the City. Farmington Youth Hockey has committed to bringing five new tournaments per year to Farmington. This amount opens the opportunity to bring in hotels, restaurants, etc. A single tournament brings in eight teams from outside of Farmington. There would be 100 children coming to the community; including families this would be approximately 390 people in one day. This does not include the Heritage Figure Skating Club or high school tournaments. The group is also looking at changing the arena into an all year around use. Ice For Tigers has developed a Rink Expansion Capital campaign with different donation tiers. 2 EDA Minutes(Regular) February 25,2013 Page 2 The group asked the EDA to partner with them and turn this campaign into a Farmington Expansion Campaign. Ice for Tigers will reach out to businesses and would like to have a partner to encourage businesses to come. They would like to work with the EDA to create economic development activity packets that go along with their packet or even being included in their packet. It would provide information on where businesses could come,and hold joint meetings to discuss where opportunities exist. The group would like to use the sponsorship dollars they are receiving to talk about franchises and other businesses. City Planner Smick stated the EDA's Business Attraction Plan has a marketing component and this could be a great opportunity for Ice for Tigers to join in with communication,marketing, advertising, etc. Mayor Larson noted Ice for Tigers could also use the Open to Business program. A feasibility study has been done and the soils next to the arena are approved for building. The group also has a parking plan and will be using some of the school's parking lot. Member Wilson asked about commitments they have in place. The overall cost of the rink will be $4.2 - $5.2 million including a 5%contingency. Ice for Tigers is committed to raising$1.5 million through sponsorship and organic fundraising. A number of their tiers are sold and have taken in $360,141 in uncommitted sponsorships and have added$200,000 in committed sponsorships. Uncommitted sponsorships are not going to any specific tier,but are outside of those. FYHA and the school are working through their commitments. Member Wilson felt it would be beneficial to at least indicate this activity is going on. Member Jolley clarified they want the EDA to collaborate with them on the interest,marketing,the buy-in of the community to their project. Mr. Junker stated there are more opportunities to partner with businesses to be part of the rink if they were also coming into the community at the same time. Through that effort,there is a joint effort to be able to reach more national franchises and sponsors who have more capital means to sponsor the rink if Ice for Tigers works with the EDA. Member Zeaman asked if they have a business plan. Mr. Junker stated the campaign brochure breaks down the costs in detail. 6. CONSENT AGENDA MOTION by Wilson, second by Bonar to approve the Consent Agenda as follows: a) Approved Meeting Minutes (1/28/13 Regular)(2/20/13 Workshop) b) Approved Bills 1/28/13 —2/24/13 APIF,MOTION CARRIED. 7. PUBLIC HEARINGS 3 EDA Minutes(Regular) February 25,2013 Page 3 8. CONTINUED BUSINESS a) CDBG Senior Center Scholarship Program—Lisa Henning Currently there is $16,000 in CDBG funds for senior center programming. The primary goal of the CDBG program is to develop viable communities for persons of low/moderate income through decent housing, suitable living environment and expanded economic development. Each year not less than 70%of CDBG funds must be used to benefit low/moderate income persons. Staff has asked that a financial support program be implemented to assist low/moderate income people. This would allow those who qualify an opportunity to buy memberships to the Rambling River Center,the fitness room, and attend programs. This would provide an opportunity to increase memberships and programs. There are just over 400 members currently. There are 1,100 people living in Farmington over 62 years of age. Staff will be targeting people who are not current members to get them to join the senior center. Staff is requesting the entire$16,000 be used for a financial support program. This would be used over 2—4 years. Member Jolley asked about the income verification. Anyone applying for assistance,would have to provide this information. Member Wilson asked about the CDBG fund balance. The current balance is $111,000,but there are several programs to deal with and we can shift money around. Ms. Lisa Henning noted as far as HUD is concerned,the $16,000 has already been allocated to senior center activities since 2001. She noted other cities do allocate a percentage of their funds to public services. Member Bonar asked if there is an annual cap for the scholarship for an individual. Staff noted a cap has not been identified yet, but have discussed allowing someone to get a general membership and a fitness room membership which would be less than$100 for both. This would be a yearly scholarship. Member Bonar noted we do have other purposes for that money. He would like a more moderate approach that pilots the dollars. The original request in 2011 was for some staffmg and some scholarships. Member Bonar suggested a pilot program and work with local civic organizations to run a program to represent the public and private interests. Staff clarified the$16,000 was not identified to be split, it was entirely for a staff person. Farmington has a limited number of service organizations and staff would be willing to contact them. However, several organizations have made commitments to the building fund which have not yet been paid. Ms.Henning stated to move the money around would require a 30 day public notice,approval by the City Council and the County Board. Member Zeaman asked how much staff thinks the membership could increase. Staff would be contacting residents of Spruce Place, Red Oak Manor and Vermillion River Crossings at least. Approximately 100 members would be realistic. In 2006 there were over 500 members. Member Jolley had a concern about being good stewards of money that is made available like this. This is a lot of money for just scholarships. She would prefer to see some of the money be used to enhance the programs we have or adding programs. Ms. Henning noted it 4 EDA Minutes(Regular) February 25,2013 Page 4 can be used for programs for people 62 years of age or older or 51% of the participants would have to be low/moderate income and would have to provide income verification. Staff agreed with creating programs for those 62 years of age or older. The daily attendance is approximately 63, or 16,000 people/year. Member Bonar would support a measured response and liked splitting the funds between scholarships and programs. MOTION by Wilson, second by Jolley to approve$16,000 in CDBG funding for an Older Adult Financial Support Program. Voting for: Larson, Jolley, Wilson. Voting against: Bonar,Zeaman. MOTION CARRIED. b) Open to Business Program—Laurie Crow Ms. Crow was unable to attend the meeting. The Open to Business Program begins February 26, 2013, in Farmington. Ms. Crow will be at City Hall to meet with people interested in the program. c) Business Development Grant Revision This is a CDBG funded program and offers opportunities for new, existing and expanding businesses to request funding. There is a low/moderate requirement concerning Davis-Bacon wages. There are three different types of grants; a business expansion grant,microenterprise grant which is rental assistance, and the redevelopment grant which is for EDA owned projects. Currently the business expansion grant only allows one time funding for a business to receive CDBG funding. Staff is proposing to allow a business to apply a second time after four years to help them with business expansion. Staff outlined proposed criteria. Members Bonar, Wilson and Zeaman agreed with this. Member Jolley noted there is a limited amount of funds and we have a lot of requests from eligible new businesses. When a business expands and meets the criteria of 50%more employees, and the ability to take on new work and expanded profits,if they have to come back a second time there is a problem. What didn't work when they expanded the first time? She would like to see the funds available to first time requests. Member Wilson felt this would be another tool available to staff. City Planner Smick felt a community that has the opportunity to offer a second possibility for expansion is a community that will get businesses to come. We should keep the door open and let businesses know we are behind them 100%. Chair Larson saw this has a business retention tool. Member Jolley suggested that businesses that receive a grant,work with the Open to Business Program to make their business strong. This will be discussed in future meetings. d) 2013 Business Visit Plan Staff proposed business visits the second and third week of each month. Chair Larson asked that visits not be held in November and December. Members informed staff when they are available. Member Wilson would like to see more visits to the industrial park. 5 EDA Minutes(Regular) February 25,2013 Page 5 e) Business Attraction Plan A Business Attraction Team will be formed to implement this plan. The team will be made up of EDA members,business owners, school district, and Dakota Electric Economic Development Director. The plan includes marketing,pro- active communication,business incentives,etc. The EDA will determine the focus and the Business Attraction Team will carry it out. The team will need to determine a target business list. The team will present Farmington to the rest of the metro. The two biggest items we need to work on are the business subsidies and the business attraction. Member Zeaman suggested working on a five-year plan for what businesses we want to attract as we have very little money, so we need to determine how we want to invest that money going forward and execute a business attraction plan over five years; start small and work bigger. Mr. Clyde Rath, FBA, stated when a business is looking to come to Farmington, we have very limited space for them to go. He felt the EDA needs to look at what Farmington will look like in five,ten,twenty years. It may take the EDA to step up and be the developer for awhile until the developers come in. Chair Larson stated that was discussed in Council's goal setting. City Planner Smick heard about an industrial business that needs 30 acres to construct a business. We have the area on the west side of Pilot Knob and north of hwy 50,but we do not have the property owners ready and there is no infrastructure. That is an example of what we need to have for a five-year plan. Staff needs to contact the property owners. Mr. Rath sees our greatest potential being small—medium sized businesses. Chair Larson noted that is where Vermillion River Crossing becomes important. Member Zeaman noted we have two pages of available spaces all around town, so he was confused as to what the concern was with finding space. Mr. Rath noted it comes down to the cost of the space. I) Business Subsidy Policy This policy is being reviewed by the City Attorney. Staff is proposing to have a Tax Abatement opportunity and a Business Incentive opportunity. Chair Larson suggested bringing this back after review by the City Attorney. g) Bank Summit March 20,2013 This event will be held at 2:00 p.m. at City Hall. Four local banks and MCCD will be present to discuss incentive programs and how they can partner with the City. h) Review Proposed Economic Development Support Resolution This resolution was to show Council's support of economic development in every decision they make. 6 EDA Minutes(Regular) February 25,2013 Page 6 9. NEW BUSINESS a) Approve CDBG Agreement Triton Properties,LLC This business will be removing three fuel tanks in the former Oasis Market location on 8th Street. They are requesting a grant for$7,320,and they have met the requirements. Once approved by the EDA,this will also go to Council on March 4,2013, for approval. Member Wilson asked what prevented the owner from selecting the lowest bid. Staff explained it was his preferred contractor and they could select which bid. Ms. Lisa Henning, CDA, explained the CDA requires the lowest bid unless there is a documented reason. Staff stated it was because this contractor could complete the work sooner. The owner is proposing a Dollar Store with some office space. Member Wilson was not comfortable not awarding the lowest bid. He suggested approving half of the lowest bid of $13,044.75,unless we know of a significant delay in the work. Ms. Lisa Henning appreciated the idea of approving half of the lowest bid,because HUD would ask for the rationale for letting him not take the lowest bid. Member Wilson felt the EDA does not have enough information to give him the higher amount. EDA members asked staff to research if a Business Development Grant also needs Council approval. MOTION by Wilson, second by Bonar to recommend approval to the City Council of a Commercial Rehabilitation Grant for$6,522.38 which is half of the lowest bid of$13,044.75. APIF,MOTION CARRIED. 10. CITY STAFF REPORTS Member Wilson asked if EDA members could receive a calendar of activities. 11. ADJOURN MOTION by Jolley, second by Wilson to adjourn at 8:58 p.m. APIF,MOTION CARRIED. Respectfully submitted, Cynthia Muller Executive Assistant 7 • MINUTES ECONOMIC DEVELOPMENT AUTHORITY Special Meeting February 28, 2013 1. CALL TO ORDER The meeting was called to order by Chair Larson at 7:00 p.m. Members Present: Larson,Bonar, Jolley,Wilson, Zeaman Members Absent: None Also Present: Lee Smick, City Planner; Cynthia Muller,Executive Assistant 2. PLEDGE OFALLEGL4NCE 3. ROLL CALL 4. APPROVE AGENDA Chair Larson switched the order of 5a) and 5b). MOTION by Wilson, second by Zeaman to approve the Agenda. APIF,MOTION CARRIED. 5. CITIZEN COMMENTS/PRESENTATIONS b) Open to Business Program Presentation—Laurie Crow Ms. Laurie Crow, MCCD Open to Business Program, is the point person for Dakota County. This program is new to Dakota County and she will be at City Hall for two hours every month for walk-in customers or they can make an appointment. The program is to support entrepreneurs and small businesses in participating cities. They meet with entrepreneurs to discuss ideas for a new business or to expand a small business with marketing and lending. They are not a first point for loans for businesses, but do offer$1,000- $25,000 and do partner with banks and the Small Business Administration. Ms. Crow serves as the voice of reality as to whether starting a business is feasible. MCCD assists with starting a business and as they continue to grow. a) Approve CDBG Business Development Grant Agreement Baldys BBQ Mr. Brian Wheeler is proposing to open Baldys BBQ and is requesting a grant for $15,000. The available balance in the fund is$22,377.50. Mr. Wheeler will use the funding for kitchen equipment, a sign and a computer system to run the business. He has to meet the 51% of low/moderate income employees and will have to certify this requirement yearly. If he should sell the business or close within three years,the funds have to be repaid. The total cost of the items is $25,993. City Planner Smick reviewed the bids received with the EDA. Member Zeaman asked Mr. Wheeler about the 51% of employees being low/moderate income and how he will ask them about their income without violating the law. Mr. Wheeler will not be hiring anyone currently employed. 8 EDA Minutes(Special) February 28,2013 Page 2 Member Zeaman noted the form has to be completed for the entire household so he was concerned how this will be monitored. Mr. Wheeler stated four or five employees will be full time and 15 -20 will be high school students part time. Member Zeaman noted with high school students,they live with their family and the median income of Farmington households is over$70,000 so most all will be out of the minimum wage. Member Zeaman noted he will be competing with other downtown restaurants and will they feel slighted that he is getting a grant and is there something unique he brings that we want for Farmington that will make it worth dealing with the unfair competition challenges. City Planner Smick stated that is why we need to develop a business assistance criteria. Staff and the CDA felt the building has been vacant for at least two years, and he is bringing in employees. Member Zeaman asked if we have to spend the funds by a certain date or we lose them. Staff replied yes,the CDA is asking us to become more compliant. We have to spend$57,000 by May 1, 2013,to meet our criteria. On July 1, 2013,we receive the 2013 fiscal year funds of approximately$35,000. We do not lose money not spent,but HUD is getting more restrictive. Member Zeaman asked what outcomes are we looking for by granting the money and how will we measure that. Staff stated it will be measured by the number of employees and the number of years he is in business. Member Bonar asked how the items requested add a product offering or assistance to his company. Mr. Wheeler explained the use of the equipment and the computer system is to run the business between Farmington and Lakeville. Member Jolley stated the 51%of low/moderate income levels restriction seemed cumbersome. In order to comply,Mr. Wheeler must have the authority to ask employees about their income level. Member Jolley stated not everyone that applies will meet that threshold, so she will rely on the fact that Mr. Wheeler will be diligent in reporting. Mr. Wheeler will contact the CDA to determine how to fulfill their requirements. Member Jolley also noted that a household's status will change and how do we track that? Mr. Wheeler felt if he is diligently trying to follow the rules,the CDA will say this is what you need to fix. Member Zeaman stated 51%is a significant number of employees. Mr. Wheeler stated not one of his employee's in Lakeville is above that level. Member Wilson felt the liability falls to the applicant. He wants the money and there are strings attached. He would guess nine out of ten teenagers that apply will be above the scale because the threshold is not that high. Member Wilson suggested staff and the City Attorney meet with the CDA to make sure there is an understanding of where the liability falls. If all the applicants are over the threshold,what does he do? City Planner Smick stated City Attorney Poehler crafted the agreement and made sure there was no liability on the part of the City. Not many people apply for CDBG grants and receive them. 9 EDA Minutes(Special) February 28,2013 Page 3 Member Wilson noted we will have$7,000 left in the fund. How will that be used? City Planner Smick stated for fiscal year 2013,which has not yet been approved by the CDA, she has proposed moving$27,000 of the total$48,000 from residential rehab to business development. We will receive$35,000, so $5,000 would go to business development and$30,000 to commercial rehab. She is putting the money in areas where it will be used. Residential rehab has not been used for two years. MOTION by Wilson,second by Jolley to award a Business Development Grant of$15,000 to Coursole and Wheeler Inc. (Baldys BBQ) and execute the grant agreement. Voting for: Larson,Bonar,Jolley, Wilson. Abstain: Zeaman. MOTION CARRIED. 6. CITY STAFF REPORTS a) City Council Visits City Planner Smick noted the March 13, 2013 visit will be to Shidor, and downtown businesses. Member Jolley has had a couple residents speak to her about things they would like to see and asked how the EDA should be informed. Chair Larson suggested they come to the EDA themselves or send it to staff. Member Zeaman asked that a workshop be scheduled for reporting and what the EDA wants to see for outcomes as far as grants that are issued. City Planner Smick mentioned she would like a workshop for business assistance criteria and monitoring. Chair Larson asked that as many things as possible be handled in one workshop. Member Wilson suggested City Planner Smick put together a list of requirements and bring it to the EDA for input. 11. ADJOURN MOTION by Zeaman, second by Bonar to adjourn at 7:22 p.m. APIF,MOTION CARRIED. Respectfully submitted, Cynthia Muller Executive Assistant 10 gQ.. City of Farmington 430 Third Street Farmington,Minnesota 651.280.6800•Fax 651.280.6899 wwwci.farmington.mn.us TO: EDA Members FROM: Lee Smick,MCP CNU-A City Planner/Economic Development SUBJECT: Business Attraction Plan DATE: March 25,2013 INTRODUCTION/DISCUSSION The Business Attraction Plan application deadline was on March 18,2013. At this time, one business owner and Superintendent Jay Haugen have applied. Therefore,notices to the public will be extended from the March 18,2013 application deadline to April 15,2013 to allow additional applications to be submitted. The timeline for completion of the Plan's action steps will be extended after the initial deadline of July 1,2013. Council Member Bartholomay has asked that the EDA discuss the need to provide two Council Members on the Business Attraction Team. Please see his attached email. Business Attraction Plan—Team Members The Team will be made up of 2-EDA Members, 2-business owners(preferably 1-FBA, 1-business owner), 1 or 2 -ISD #192 School Board Member and/or Administrator,and Mark Loftus,Economic Development Director, Dakota Electric. Laurie Crow,MCCD"Open to Business"and Dale Severson, Realtor for VRC will work as consultants to the team. Staff will be in attendance to record the meeting. ACTION REQUESTED Discuss the extension of the applicant deadline for the Business Attraction Plan and the makeup of the Team. Respectfully submitted, ee Smick,AICP C -A City Planner 11 Lee Smick From: Jason Bartholomay Sent: Sunday, March 17, 2013 2:34 PM To: Lee Smick Subject: Business Attraction Team Hi Lee, I wanted to pass on my two cents for regarding the business attraction team. I think there should be two members from the city council as well. You have the school board or district and the EDA, but I think it is missing council-member's. The reason for this is most businesses want to see councilmember's or the Mayor if they are looking to come into the city. I like the fact that there is the two EDA members. If one of those members is a councilmember than maybe we would only need one councilmember. This is only my two cents on the matter for what its worth. Keep up the great work. Respectfully, Jason Bartholomay Sent from my iPad 1 12 �o� 1�,F iti� City of Farmington 4 �' 430 Third Street Farmington, Minnesota 651.280.6800•Fax 651.280.6899 .api:0 0� www.ci.farmington.mn.us TO: EDA Members FROM: Lee Smick,AICP CNU-A City Planner/Economic Development SUBJECT: Business Subsidy Policy DATE: March 25,2013 INTRODUCTION/DISCUSSION The Economic Development Authority (EDA)has requested staff prepare information concerning a Business Subsidy Policy and a Business Incentive Program. In order to do so, staff will discuss if the City will require an overall business subsidy policy that sets the stage for an incentive program or a business incentive program that stands on its own. Discussion will also extend to how area cities provide funding to their businesses and what types of programs they fund. In preparing these discussions,the EDA and staff will work on these business subsidy proposals over the next three to six months to ready them for adoption at the end of 2013 into 2014. Andrea McDowell Poehler will also be in attendance to offer information about State Statute requirements concerning business subsidy programs overseen by the EDA. Andrea McDowell Poehler will also discuss the proposed business incentive program already reviewed by the EDA at the orientation and February 25, 2013 meetings. Ms. Poehler has prepared comments to the proposed program and she will review her highlighted comments with the EDA. Attached Items Included in this packet with documents dated October 22,2012, are metro-wide community programs and also programs from cities outside of the State as shown below,to spur brainstorming discussions on types of funds that Farmington may want to expend funds to in the future to advance economic development in the community. City of Bettendorf, Iowa—Façade Program Purpose—Provide local businesses with incentive to undertake projects that results in physical improvements to property. Lessee may also request funding if owner of building approves. Review program every year for needs and if it will continue. Grant- $1,000-$10,000 or 25%of total project cost 13 Eligible—Exterior façade, landscaping, streetscaping, street lighting,parking lots, signage Review process— 1) Business Owner submits application, 2)Façade Review Committee—City staff,Business owners, and civic leaders determine if program goals are met and the committee recommends approval to the EDA. Five year waiting period before business owner can apply again. City of Alton,Texas—Facade Program Purpose—Assist existing businesses to fill"gap"between available capital and what is needed by the business to improve the property. Program is to complement lending institutions by filling the"gap". Grant- $5,000 cap on a 50/50 basis Eligible—Design Guidelines in Downtown Improvement District are to be followed and improvements need to be completed within 90 days of approved grant funding. Review process— 1) Obtain two contractor bids. 2) Owner submits application. 3) Construction no later than 90 days after grant approval. 4) Contractor bills City directly upon completion of project and applicant has paid their share to contractor. Storefront improvement needs to remain the same within 1 year of completed construction. City of Hamilton, Ohio—Design Assistance Purpose- Encourage the establishment of for-profit, new businesses and the expansion of existing businesses in the city for renovating an existing or constructing a new building with a grant of up to $2,500,to be used for professional architectural/technical services. Design services eligible: Floor plans showing existing and/or new construction; Building façade improvements; and Preliminary building,zoning and safety code analysis. Qualifications for Funding • Small business must have no more than 30 employees • Personal financial statement is required from all applicants • Grant proceeds may not be used for in-house or staff design • Business plan must be submitted • Project must be consistent with zoning requirements and business district plans • Only one grant per business address per year •Minimum project investment of$10,000 • Maximum grant award is$2,500 • Project must be completed within 12 months of the filing of the application • Applicant is required to file a$250 application fee,which is refunded upon the issuance of a certificate of occupancy 14 Process The following is the basic process of the Program: • Business owner files their application • City reviews application and give go-ahead to proceed • Small business owner selects their design professional • Design professional completes plans and permits are issued • Small business owner submits paid invoices for design services • City reimburses owner for invoices after construction is underway • Application fee is refunded upon issuance of certificate of occupancy City of Riverside,California The Riverside website example shows the"menu"template that staff is proposing to include on the City website and in a brochure that would be available at the City,local banks, and other community areas. ACTION REQUESTED The meeting will include an informational session on State Statute requirements and the opportunity to brainstorm types and varieties of funding opportunities for local business in Farmington. Respectfully submitted, Lee Smick,AICP CNU-A City Planner 15 CITY OF FARMINGTON Economic Development Authority-Business Incentive Program (PROPOSED) Program Purpose:To attract new,businesses to Farmington and retain existing {Deleted:(existing?) businesses whose local operations will do the most to expand the City's economy and job base. first How the Program Works:The program uses a two-tiered evaluation process to: l� {Deleted:eligibility for incentive financing;ant determine the amount ofprogram --{Deleted: second funds for which a business may be eligible.The maximum amount of funding for this • Deleted:, ` program is$ ,,j�'undin g will be provided through the Economic Development , {Deli:to Authority Business Incentive Fund,which is specifically reserved for economic • Deleted:, development activities. • Deleted:and Objectives:The EDA and City Council will consider providing a business incentive to Deleted:' I ' facilitate expansion of an existing business or locating of a new)usiness into commercial __`..-- Deleted:the and industrial space within the City limits of Farmington,Minnesota, or the publicDeleted:(expanded?) purpose of creating new jobs and employment opportunities in the community. In Deleted:and establishing this program,the City seeks to: •Increase the number of local jobs in the community. I •Provide employment opportunities for Farmington residents. •Expand the municipal tax base. This program is primarily targeted to�small�businesses�and is envisioned to be undertaken _=-- Caintnent'toT I)efineo<`sve on a pilot basis and will be subject to review by the Economic Development Authority dune pareameteis;.-" • and City Council. -{Fomtatted:Highlight Amount Available:Maximum funding amounts are determined based on evaluation of positive economic impact and the number of full-time or full-time equivalent jobs to be Cctninegtt tiOinli;n;;ii E locatedLor fretainedj? within the City of Farmington.Funding amounts will range from consietent.wide the goat ofexpensuio or' ($1,000)to a maximum ($7,500)per business,�wlu'ch'is funded'annually at locetiag;a yew business. "''°oth'er criteria • would need to lie added,e.g.retention of $25,�00Cj The EDA and City Council consider requests on a case by case basis in existing so8;nesaes.,faimington ., accordance with the guidelines which follow. ,;{Formatted:Highlight \\ Formatted:Highlight Eligible Businesses: Formatted:Highlight •Must be a for profit business. $; Comn_IenU'tAF!IP3]:;I�o�you mean that •Must currently be located outside the Farmington city limits or starting up in the find,in funded at 525;000?If so,is;', Farmington as of ,and will be starting business operations in the City,or must be this intended'to provide for autgmade fnri t er Sd is proposing a physical expansion of a business currently located within the Ci ty of Proovd e d rh e Inceao i tu oded Farmington that is proposed to increase jobs by FTEs annually,at ais;000n o is this even P p J Y t rieeessery7,rs this j ,4 an aunoal Budget, •Must be constructing,purchasing or leasing commercial or industrial space or land in i'; decision?' :,_ _ . ',;, Farmington. 1 Formatted:Highlight •Must be located in an area of Farmington that is currently not part of an existing tax .,, Deleted:a —� increment finance district or abatement district. ' Deleted: 1 • 16 . . . . . . . . . . . . . . . . . . . Eligible Project Costs:The applicant,nust specify what business related expenses the . -{Deleted:is asked to incentive will be used for in the application materials and must provide documentation - ) that the funding was used for the identified purpose. Ineligible Projects:Business incentive assistance will not be provided to.projects that: •Are not a for-profit business. •Are currently operating,under construction,or under contract by purchase agreement at ,...-- Formatted:Highlight 1 lease agreement to locate,„in the City of1F:arnairigtoi ..- cortontelit(Amp,tilliA0wciuld'peeci •Are located in a current tax increment finance district or tax abatement district ss, to be ro4ised,if!'dkPenSiiiir is also ' •Z‘ considered a liarid fez.fading •Are currently located and operating in the City of Farmington. .s„ . -, I •Place extraordinary demands on City services. \s,st Deleted:fel i •Continue and/or expand a nonconforming uses. I Formatted:Highlight •Conflict with significant City redevelopment priority projects. •Have outstanding and/or unresolved City Code violations. •po not comply with applicable,City zoning and use requirements. .....--tDeleted:Are not in accordance with •Involve business activities that are likely to increase nuisance issues in the conunumtv, --f Deleted:the appropriate ) increase enforcement demands,or have negative environmental impacts in the community. -- Deleted: are inconsistent with the EDA's goals,including,but not limited Desired Qualifications:Preference will be given to projects that: to,sexually oriented businesses,pawn •Provide significant new employment opportunities in the City of Farmington,with an shops,tattoo parlors,off sale liquor stores,tobacco shops,tom shops,check emphasis on quality wages and benefits. cashing businesses or those considered to •Are in accordance with the highest and best use of the property. create environmental problems due to the •Reduce demands on City services(i.e.Public Safety). type of operation or processes involved in the business operationl •Fill an unmet market need. •Are providing significant investment into the commercial or industrial space in the city. Application Procedure: 1.Contact appropriate City staff to discuss the scope of the,proposed project,The request :..._----(Deleted:new will be reviewed by City staff on a preliminary basisito make an initial deterinipgion........ --- Deleted:a whether the application will,conforntwith the program guidelines anapolicies. ....,... . - Deleted:as . . 2.If the proposed projectgpears to meet theyrogram's objectives,the applicant may , - Deleted:the „ elect to file a formal application for a Business Incentive with the City and provide the ',„ '‘. ,,. - ) Del :rty required additional documentation. „ . Deleted:,in staff's judgment, 3.The application will be brought forward to the Economic Development Authority,to review the positive impact of,pusines and make a recommendation on the amount of „....- Deleted:the new(existing ) incentive for the project($ ($1,000)to a maximum — s5 ' '' ($7,500) per-1E4010 . • Deleted:?) .......... 4.Following the recommendation of the EDA,the application will be scheduled for the --•• Comment[limps-iv no,s,--(ii have any next applicable City Council meeting,at which time the City Council will make the final gdeliries yetwanseets the amount Of funding appropriate for each determination on whether a Business Incentive is appropriate and approve or deny the 14isinene Is D,040.to17,50 large enough application and agreement OpkilOtCto gat to the detire-dienIS east MerkeIt Weith the, 'llitie4t:444408.1,4 to, fill*all of the paperwork ehrt' ',• 401:60:. •. Approval Process: 2 17 The City Economic Development Authority will review applications and make a recommendation to the City Council for their consideration.The Farmington City Council will have the final authority of whether to approve an(application[. Comment[AMP6]:Do you need both EDA and City,to approve such Smell amoimts? If City has fimded the'fund Disbursement: Payment of the approved incentive will be made by the City upon the annually,is it Suffcieitfor just the EDA followin : to provide the Subsidy(why have the g EDA'iit the middleman at all?) . • LVerification by City staff_of_payment of the business's property taxes(land and improvements) Deleted:Payment of the approved • Execution of Grant Agreement incentive a fioaceiculaiea by City staff cat • Applicant providing verification that employment numbers were created during `•,,; Formatted:Highlight the time frame as agreed to by the business and City Council. {Formatted:Bullets and Numbering • -i {Deleted:, ■ he calculation will be based upon:the taxes actually_paid by the busine_ssa accordng,to County tax records,or if a lessee,,upon the property tax figure `. Deleted:and the business i ehneated nI the sl e_d lease agreement between the property e owner and th� `�1��' usiness'(lf less than the actual Formatted:Highlight b -than al property�taxes1)'------------------------------------------------- • ,Availability of funds;, Comment tAii:0711 rim not sure I understand this;. Reauthorization: Vs, Formatted:Highlight The Business Incentive Program is envisioned as a pilot and will commence for two years Deleted:The business incentive able will be � P• Y paid out as finds are available. after Council approval. At the end of the pilot period,the program will be reviewed by • Deleted: 4 the EDA and City Council to determine if the program should continue.po additional Funds wall be disbursed to the business funds will be spent without City Council reauthorization of the program beyond the pilot uI'°n verifieation of creation and maintaining job levels dining the lima program, flame as agreed to by the business and City CounciL Deleted: and • Deleted:if all the finding has been expended or the end date has been reached Deleted:. 3 18 (PROPOSED) BUSINESS SUBSIDY POLICY I. PURPOSE AND NEED FOR POLICY This policy provides the criteria for Tax Abatement. The business subsidy criteria included in this policy applies to all potential business subsidy recipients. In addition to this policy, every business subsidy will be subject to the requirements of Minnesota (MN) Statutes. II. POLICY A. Every business subsidy shall be subject to the requirements of MN Statutes governing business subsidies and every business subsidy shall be evaluated according to the criteria included in this Business Subsidy Policy, which shall apply to all potential recipients. Wherever the term business subsidy is used in this policy, its definition shall be that as defined in MN Statutes. B. A business subsidy must meet a public purpose. The City of Farmington (City Council) and Farmington Economic Development Authority (EDA) shall consider using business subsidies to assist private development projects in an attempt to achieve one or more of the following public purpose objectives: to retain local jobs and/or increase the number and diversity of jobs; enhance and diversify the City's tax base; encourage additional unsubsidized private development in the area, either directly or indirectly, through "spin off" development; achieve development on sites that would not be developed without business subsidies assistance; remove blight and/or encourage development of commercial and industrial areas in the city that result in higher quality development or redevelopment and private investment; and offset increased costs of development of specific properties when the unique physical characteristics of the site may otherwise preclude private investment. C. A business subsidy must result in wage increase or the creation or retention of jobs, which will pay at least 125-percent of the federally imposed minimum hourly wage, exclusive of benefits, with the wage goals specifically set forth in the business subsidy agreement. The wage goals will be determined as a weighted average on new jobs created as defined in the City of Farmington Fundability Guidelines for Financial Assistance Form. D. In lieu of job creation or retention, other measurable, specific, and tangible goals shall be established. Examples of tangible goals may include redevelopment, or pollution or soil remediation. E. If wage increase or job creation or retention is identified as the public purpose, goals must be established for wage increase or the number of jobs created; in cases where job loss is specific and demonstrable, goals must be established for number of jobs retained. As set forth in the business subsidy agreement, wage increase or job creation or retention (based on wage floor set forth in the agreement) shall be attained within two years of the benefit date. F. The business subsidy agreement must stipulate that the recipient will continue operations at the site where the subsidy is used for at least three years after the benefit date. 1/22/13 19 G. Any development agreement for public assistance as defined in MN Statutes shall contain, at a minimum, the following provisions: 1. Description of the subsidy including the amount and type of subsidy 2. Statement of public purposes for the subsidy in addition to tax base increase 3. Identification of measurable, specific, and tangible goals for the subsidy 4. Description of the financial obligation of the recipient if the goals are not met 5. Statement of why the subsidy is needed 6. Statement of commitment to continue operations for at least five years in the jurisdiction where the subsidy is used - the five year commitment may be waived if the grantor, after a public hearing, approves the recipient's request to move 7. Identification of the name and address of the parent corporation of the recipient 8. Identification of all financial assistance by all grantors for the project; and reporting requirements 9. Identification of specific wage floor for the wages to be paid, if job creation or retention is a goal, of at least the minimum set forth in Item C of this policy, and for at least two years after the benefit date or until the goals are met, whichever is later J. When granting a business subsidy, the City Council or the EDA may deviate from the criteria in this Policy by documenting in writing the reason for the deviation and filing that explanation with the Department of Employment and Economic Development along with the grantor's next annual report on business subsidies. The City Council and the EDA will not approve a deviation from these criteria unless the applicant provides a written request describing why the deviation is needed to permit the proposed project to proceed, and the grantor determines in its sole discretion that such deviation is reasonable and necessary. K. Each business subsidy agreement will require a recipient failing to meet the specified goals by the specified date to pay back the assistance plus interest, or at the request of the City Council and the EDA, to the account created under MN Statutes, Section 1161551. Any repayment shall be prorated to reflect partial fulfillment of goals. The interest rate shall be set at no less than the implicit deflator as defined by MN Statutes, Section 116J.994, Subdivision 6. The City Council, upon recommendation by the EDA, may after a public hearing, extend the period for meeting job and wage goals for up to one year. The City Council and the EDA may extend the period for meeting any other goals for any period specified by the City Council and the EDA, by documenting in writing the reason for the extension and filing that explanation with the Department of Employment and Economic Development along with the grantor's next annual report on business subsidies. L. The City Council and the EDA reserve the right to modify this Policy, from time to time in accordance with MN Statutes. M. The following supplemental policies are attached hereto and made part of the Business Subsidy Policy: - Attachment 1: Tax Abatement Policy III. PROCEDURE To the extent that a business subsidy requires tax abatement assistance, it must meet this Business Subsidy Policy and the Tax Abatement Policy. Any other business subsidy must meet this Business Subsidy Policy. 1/22/13 20 IV. RESPONSIBILITY AND AUTHORITY The responsibility and authority for the City Council or the EDA to adopt a Business Subsidy Policy is established by MN Statutes 1163.993-995, which sets requirements for subsidies allocated to businesses by state or local government agencies. Administrative implementation of this policy shall be the responsibility of the City Planner/Economic Development. Submitted by Reviewed by: This policy replaces the policy adopted by City Council Resolution No. on 1/22/13 21 131' ' /4/ , City of Farmington 430 Third Street Farmington,Minnesota °9mo 651.280.6800•Fax 651.280.6899 .cifarmia n.m us TO: EDA Members FROM: Lee Smick,AICP, CNU-A City Planner SUBJECT: Business Incentive and Loan Programs DATE: October 22,2012 INTRODUCTION/DISCUSSION At its August 27th meeting, the EDA requested that staff perform a survey to find out how other communities fund their EDA. The communities below deal with DEED and GREATER MSP loans and grants. The parentheses show the community's population. The list of communities surveyed is as follows: Faribault Economic Development Authority (23,352) — They have a tax levy of$215,000 based on their market value. Redevelopment programs: tax increment financing, industrial loan programs, commercial rehabilitation programs and an assortment of public improvement projects. Funding support is governed in large part by the EDA's Tax Increment Financing and Business Subsidy policies. They offer revolving loans, cost allocations from the general fund, and they have excess TIP funds to utilize. They also are in the JOBZ area. Lakeville Economic Development Commission(55,954)—The Commission offers suggestions to the Council on economic initiatives. They have no authority. They also do not provide business incentives. In the past, they only offered the City's land at a reduced cost (Lifetime Fitness). They also have'1'lk' and Tax Abatement options. (FYI—single family building permits in 2012— 169 with an additional 170 lots that have recently been platted). Rosemount Port Authority (21,874)—Their economic development incentives come from the general fund. In 2012, they received$58,000. They act as the development authority on behalf of the City's interest to increase the tax base, promote new job development and enhance the health, safety and welfare of its residents. They offer a Downtown Development Improvement Program that comes from CDBG money which is the same as we offer. They also have TIE,' and Tax Abatement options. Burnsville Economic Development Commission (60,306) — The Commission is an advisory committee only. They have a tax levy of$415,000 in 2012;which pays for EDA activities and the Economic Development Director's salary. 22 Apple Valley Economic Development Authority (49,084) — The EDA looks for job development in their medical, corporate, and financial office service development. They also provide business addition retention, expansion in its older commercial areas and centrally located downtown. They do not have a tax levy. They have old '[IF districts from the 1970's that provide their budget of $800,000 for EDA activities. They provide '[IF and Tax Abatement opportunities. They are opening up one of each industrial and housing district for TIF this year. They direct businesses to the Small Business Administration Loans Program,however,they have not been used (Farmington staff has reviewed this program and most of the programs are out of date). A number of banks in the city work with the SBA loans. They are providing$10,000 for the MCCD—Open to Business program. They currently do not provide business loans, but they are researching them. Prior Lake Economic Development Authority (22,796) - The EDA has prepared a tax increment policy, facade improvement policy, downtown redevelopment proposal and a substantially completed development of Waterfront Passage Business Park. The Economic Development Advisory Committee (EDAC) offers recommendations to the City Council and to the Economic Development Authority on economic development issues, strategy development and implementation. This includes commenting on business retention and expansion, targeting business recruitment, new business and entrepreneurial development and finding funding sources. Prior Lake budgets a reserve fund that is transferred to the EDA for economic activities such as those stated above. In 2012,this budget is $185,000. A portion of the money was spent earlier this year on an $80,000 fiber network study. It also pays for half the salary of the EDA Director and other EDA needs. There are no dedicated funds to the EDA, however, the City is proposing a tax levy of$50,000 for the 2013 budget for EDA funds. ACTION REQUIRED Information only. Respec emitted, ee Smick, City 'lanner AICP, CNU-A 23 �o�� ie�, City of Farmington I(g1� 430 Third Street P` "'x,;' Farmington, Minnesota 651.280.6800•Fax 651.280.6899 wwwcLfarmmgton.mnus TO: EDA Members FROM: Lee Smick, AICP, CNU-A City Planner SUBJECT: Business Incentives DATE: October 22,2012 INTRODUCTION/DISCUSSION Staff has prepared the information below in menu style to review business incentives that Farmington may offer to existing or new businesses in the City in the future. For instance, a company such as Installed Building Solutions may benefit from a tax abatement or through waivers of fees for infrastructure or building permit costs such as those identified below in Warren, MN. A list of funding opportunities is shown below followed by each fund's description. 1. Tax Increment Financing 2. Tax Abatement 3. Commercial Rehabilitation 4. Hastings Industrial Park Land Credit Program 5. Gap Rehab Loan Program 6. Commercial Matching Rehab Loan 7. Façade Improvement Loan Program 8. Revolving Loan Funds 9. Business Subsidy Program 10.Development Assistance 11. Entrepreneurial Fund 12. Commercial Incentives/Waiver of Fees 13.Minnesota Investment Fund 14. Small Business Development Loan Program Tax Increment Financing TIF is the ability to capture and use most of the increased local property tax revenues from new development within a defined geographic area for a defined period of time without approval of the other taxing jurisdictions. The development is only possible but for the use of tax increment. In a New Economic Development District,at least 85%of new building space must be: manufacturing;warehousing; storage; distribution;research and development; and telemarketing. 24 Costs must be associated with New Development,Land Acquisition,Demolition and Relocation, Site improvements,Utilities, Streets, Sidewalks,Environmental Clean-up, Parking, and Buildings (but only for new economic development districts). Tax Abatement Tax abatement is the ability to capture and use all or a portion of the local property tax revenues within a defined geographic area to assist with commercial or housing development. In practice,it is a rebate rather than an exemption from paying taxes. It allows each major taxing jurisdiction to choose to contribute its share of the taxes and limit abatement in any manner it determines appropriate. It can be used to retain business by abating existing taxes. In any one year,the TOTAL amount a political subdivision may abate may not exceed the greater of: 10% of its net tax capacity or$200,000;may not abate taxes on a parcel while it is located in a TIF district, abatements are special tax levies outside of levy limits, and the amount of the abatement must be added to total levy for the current year. Commercial Rehabilitation-Hastings The program is offered by the City of Hastings. The program provides financial assistance for the rehabilitation of commercial or mixed use properties located in a redevelopment project area. Assistance is made through a direct loan to the property owner,participation with another lender, or the reduction of the interest rate on a loan meeting the program criteria. The terms of the loan include a direct loan from Hastings Economic Development and Redevelopment Authority to provide supplementary or gap financing,not the primary financing. Typically the loan amount may be up to 25%of costs but no more than$200,000.The direct loan is an installment loan normally with a term of ten years,but can be no more than 20 years. Interest starts at 0%for the first year, then 4%for four years and 9%for five years. Hastings Industrial Park Land Credit Program Fully serviced lots are available in the Hastings Business and Industrial Park for only one dollar per acre under the Land Subsidy Program. Land credits can be used when the City owns the land as in the Industrial Park. The business has to be permitted in an industrial zone, such as manufacturing,processing or wholesaling. Businesses that need a special use permit to locate in the Industrial Park are also considered for the land price subsidy. The market value of the land is held as a deferred loan against the property. Upon completion of certain job, wage, and construction improvement values,the loan is terminated with no further obligations. The program allows businesses greater ability to invest in buildings and jobs instead of raw land. The price of the land is set by the City Council. At this time it is$1.65 a sq.ft. or$71,874 per acre. The development agreement stipulates that the purchaser will pay a nominal price, $1.00 an acre,and the balance will be deferred for five years. For one acre,the subsidy would be$71,873. Gap Rehabilitation Loan Program- Oakdale The program makes funds available to provide subordinated,low-interest rate loans to Oakdale Business owners for the purpose of commercial building renovations. Loans will serve to stimulate private sector investment for the improvement of Oakdale's aging Commercial Building Stock. This loan is intended for structural purposes only. Mortgages will be taken if the loan amount exceeds$10,000 and/or the loan term exceeds 5 years. The EDC will then make a recommendation to the City Council on businesses to be funded. Loans will be expected to close no more than 60 25 days after final loan approval.All work must be completed within 120 days of the loan closing. Payment to the contractor(or owner in sweat equity situations)will be made upon completion of work. Commercial Matching Rehab Loan- Oakdale The City of Oakdale,through it's Economic Development Committee(EDC),makes funds available for business owners to finance exterior improvements to their properties. The minimum loan amount is $500 and the maximum loan amount is$10,000. The interest rate is 2.9%and the term is a maximum of five years. It is the borrower's responsibility to obtain the amount of funds necessary to finance the entire cost of the work. In the event the final bill exceeds the original grant amount,the recipient must obtain the additional funds. All work must be completed within 120 days of the loan closing. Payment to the contractor(or owner in sweat equity situations)will be made upon completion of work. Façade Improvement Loan Program—Belle Plaine The purpose of the Façade Improvement Loan Program is to establish a loan program to provide the capability and incentive for owners and tenants of new and existing businesses to upgrade the appearance of their places of business,thereby improving their marketability and promoting redevelopment of new and existing business properties within the City. The maximum amount for the loan is$1,500 per business per calendar year. The loan will require a 1:1 match of the applicant, either through personal funds or a loan from a lender. Revolving Loan Funds—Alexandria Alexandria's Revolving loan funds (RLF's)can provide businesses with direct loans, loan guarantees,and other financial assistance.As the Fund receives the principal and interest payments from outstanding loans,the money is made available to another borrower. RLF's are designed to alleviate the high cost and short supply of capital by providing flexible loan terms. Typically, RLF's provide lower rates, longer terms, and reduce the overall risk of the loan. Acquisition and/or improvement to land,building,business facilities and equipment,new construction or renovation of existing facilities, demolition,rehabilitation or site preparation, equipment and machinery purchase, or acquisition/improvement of real property for subsequent lease. The maximum loan amount is$50,000. Funds cannot be used to finance working capital or professional fees. The purpose of the Belle Plaine Revolving Loan Fund (RLF) is to establish a low interest loan program to provide the capability and incentive for owners and tenants of new and existing businesses to upgrade the appearance, structural condition, and operating efficiency of their places of business, thereby improving their marketability and retaining and expanding job opportunities. The EDA will review each loan application provided the loan does not exceed the amount in the RLF. The interest rate will be set at 2%below the prime interest rate. The term for any loan will be determined by the Review Group and be set at 10 years or less. The applicant must be able to secure the loan with at least a junior mortgage upon the building and/or assets involved or other approved collateral. An administration fee of$100 or 1% of the loan, whichever is greater, will be required at the time of application. 26 Business Subsidy Program The Minnesota State Legislature enacted the Business Subsidy Act (Minnesota Statutes, Section 116K.993-995). A business subsidy is a local government agency grant of personal property, real property, infrastructure,the principal amount of a loan at rates below those commercially available to the recipient, any reduction or deferral of any tax or any fee, any guarantee of any payment under any loan, lease, or other obligation or any preferential use of government facilities that are given to a business. Basically,the likelihood that a business subsidy will be granted increases if its proponent can demonstrate that the public purpose will be achieved if, and only if, the business subsidy is granted. Any business that is seeking to obtain a business subsidy should carefully articulate the public purpose to be achieved and then demonstrate how the project in question would achieve that public purpose. In accordance with the MN Business Subsidy Law, the local body will consider using business subsidies to assist private development projects in an attempt to achieve one or more of the following public purpose objectives: to retain local jobs and/or increase the number and diversity of jobs; enhance and diversify the City's tax base; encourage additional unsubsidized private development in the area, either directly or indirectly, through "spin off' development; achieve development on sites that would not be developed without business subsidies assistance; remove blight and/or encourage development of commercial and industrial areas in the city that result in higher quality development or redevelopment and private investment; and offset increased costs of development of specific properties when the unique physical characteristics of the site may otherwise preclude private investment. Those that may apply to the Prior Lake EDA/City of Prior Lake could include: 1) a business subsidy of less than $25,000; 2) assistance for housing; 3) assistance for energy conservation; and 4)tax increment financing for a soil conservation district. Development Assistance—Jordan The City of Jordan promotes local economic development via the Jordan Economic Development Authority. Three very active commercial lenders in Jordan-Frandsen Bank, Hometown Bank, and Riverland Bank,provide fmancing for a wide range of economic development projects. The EDA has recently become a member of the Twin Cities Community Capital Fund(TCCCF)which is a nonprofit loan fund that offers customized,flexible financing solutions for gap fmancing. A business in Jordan can borrow up to$500,000 with the invitation from a bank. Entrepreneurial Fund—Red Wing The Red Wing Port Authority(RWPA)has developed an Entrepreneurial Fund to support the growth and expansion of local business/individuals and attract new business development to the Red Wing Area. This is a limited loan and collateralization can be a financial investment and/or sweat equity.The loans are from$500 up to $50,000. The loans assist with startup costs;product development costs;marketing materials;rent;working capital; equipment; and building rehab. Commercial Incentives—City of Warren • New Commercial Construction To be given to any business that is newly established within the City limits of Warren. This incentive is given to any entrepreneur willing to take a risk at starting a new business. 27 Upon completion of new construction,the owner will be provided with a utility credit of $3000 and$75.00 off the cost of a Building Permit. • First Time Purchase of Existing Commercial Building Purchaser receives a utility credit of$1500 and a free Building Permit for remodeling the building. • Remodel/Relocation of Existing Commercial Building Utility credit of$500,free building permit for remodel, and remodel must be a value greater than$7500 to qualify. STATE FUNDS Minnesota Investment Fund—State of MN The Minnesota Investment Fund provides State grants to help add new workers and retain high- quality jobs on a statewide basis. The focus is on industrial,manufacturing, and technology-related industries to increase the local and state tax base and improve economic vitality statewide. Applications are accepted on a year-round basis. Grants are awarded to local units of government who provide loans to assist expanding businesses build new or expanded facilities. Cities, counties, townships and recognized Indian tribal governments are eligible for this fund.All projects must meet minimum criteria for private investment,number of jobs created or retained,and wages paid. There is a maximum of$500,000 per grant. Only one grant per state fiscal year may be awarded to a government unit.At least 50 percent of total project costs must be privately financed through owner equity and other lending sources(most applications selected for funding have at least 70 percent private financing). Grant terms are for a maximum of 20 years for real estate and a maximum of 10 years for machinery and equipment. Interest rates are negotiated. Small Business Development Loan Program Manufacturing and industrial companies located or intending to locate in Minnesota and meet the federal definition of a small business (generally those with 500 or fewer employees)are eligible. Loans up to a maximum of$5 million may be made for any one business. Generally, 20 percent of the project costs must be privately financed through equity or other sources. Interest rate is the market rate of interest for similar securities at the time bonds are sold; rates are fixed for the term of the loan.Real estate loans are for a maximum of 20 years; equipment is 10 years. Collateral requirements include the first mortgage on real property or equipment financed by MAEDB and personal guarantees of owners. In some cases, additional security in the form of other liens or guarantees may be required by MAEDB. There is no MAEDB fee, but bond issuance costs of 4 percent are capitalized with the loan principal; 10 percent of bond issue must be escrowed. Funds are disbursed upon execution of the required loan documents and sale of the bonds. Applications are accepted on a year-round basis,but must be received by the first of each month to be considered at that month's MAEDB meeting. Other State Funds are also available from DEED. 28 ACTION REQUIRED Review funding program information and comment on the feasibility of them as a possible use in Farmington in the future. Resp�11..1 Lee Smick, ity Planne AICP, CNU-A 29 • • • FACADE PROGRAM BETTENDORF, IOWA GENERAL INSTRUCTIONS PROGRAM MISSION: To provide local businesses with incentive to undertake projects that will result in physical improvement to their property. NATURE OF INCENTIVE: A grant of between $1,000 and$10,000, or 25%of the total project costs(whichever is less)to be used for exterior improvements to property. The grant may be used as part of a loan package,or be a reimbursement to the business owner. These monies are to be provided from a pool of funds from the City of Bettendorf s Economic Development Fund. Supplemental funding may be obtained from local foundations and authorities. ELIGIBILITY: Owners of businesses affected by the 1-74 Bridge Project in Bettendorf are eligible. Owners of businesses located in buildings or on land owned by another party are eligible for the program, providing they have written permission from the property owner to make application. All applicants must be current on all city taxes and fees and meet all city building codes. HOW IT WORKS: 1. A business owner makes application to the City. A completed application will include a description of the improvement project with drawings and two(2),detailed cost estimates. Applications may be picked up and delivered to the Economic Development Department, 1609 State Street, Bettendorf, Iowa 52722 or by going to the Economic Development Department within the City's website,www.bettendorf.org, and printing off a copy. Completed applications may also be emailed to svandvke @bettendorf.org. 2. A Façade Program Review Committee,consisting of City staff and Bettendorf business and civic leaders,shall review the project application to make certain the project is consistent with the goals of the program. Upon approval of the project by the Review Committee,the application will be submitted for approval to the City,whereupon approval grant monies will be allocated to the project. 3. With approval of the grant the project may be undertaken. Once complete,the business owner submits verification of actual costs and payments made. A request for payment is then submitted to the City for repayment of the agreed-upon portion. In order to receive payment,the project must be completed as originally approved. Grant monies may be rescinded from any project not completed within one year of the date of the award. 30 ELIGIBLE IMPROVEMENTS: The City wants to help enhance the exterior image of the community and encourage applicants to be creative in their projects. The architectural standards contained within the Downtown-Riverfront Commercial Overlay District(DRCOD)and the streetscape concepts contained within the Downtown Master Plan will be strongly encouraged,even if the project is not located within the downtown. The following improvements are eligible for funding, in order of their priority: 1. Exterior Facade: New windows,tuckpointing, painting. Also removal of antiquated or inappropriate facades. 2. Landscaping: Bushes,trees,flowers, sod,seeding, diverse types of plantings. Can also include sculpture,other monumentation as approved by the Review Committee. 3. Streetscaping: Sidewalks, planters,concrete improvements in the front. 4. Street Lighting: Exterior lighting, new poles with emphasis on energy efficiency. 5. Parking Lots: Customer parking lots that are visible from the street. 6. Signage: New business signs meeting City code. 7. Others: Exterior improvements as approved by the Review Committee. PROGRAM SCOPE: Once a business owner makes successful application to the Facade Program, he or she may not apply for any other project on that property for a period of five years. This restriction may be waived in specific instances through special action of the City Council. • PROGRAM REVIEW: At the end of each twelve month period,the City Council will review the program to determine whether it shall be continued, and in what form. APPLICATIONS ARE AVAILABLE AT THE FOLLOWING LOCATIONS: Economic Development Dept. or www.bettendorf.org Bettendorf City Hall Economic Development Dept. 1609 State Street Facade Program Applications Bettendorf, Iowa 52722 563-344-4060 svandvke@bettendorf.org 31 CITY OF ALTON DEVELOPMENT CORPORATION Façade Grant Program Concepts Guidelines and Procedures Program Goal The goal of the Façade Grant Program (FGP) is to help provide financing for existing businesses that will be used to repair, repaint, renovate and/or improve property within the Downtown Improvement District. The Downtown Improvements District has been defined as Conway FM107 and Mile 5 within the city's limits. Strategy The purpose of the FGP is to complement lending institutions by filling the "gap" between available capital resources and what is needed by the business to improve this property. The net result is the attraction of capital and employment that stimulates economic growth in ALTON. These guidelines and procedures are effective upon adoption by the CITY OF ALTON DEVELOPMENT CORPORATION(CADC)and the City of ALTON. FGP Applications must meet the following criteria to be eligible for FGP assistance. Such criteria shall include: 1. The business or organization must be located within the Downtown Improvement • District. 2. FGP Grants must only be used to repair,renovate or improve the facades of these • properties. 3. Qualified businesses will include business enterprises already in existence and located in the City of ALTON. 4. The project's details must be approved by City staff. 5. All projects must meet City of Alton ordinances and State and Federal code guidelines. 6. Qualified projects will include only those who have not begun exterior improvements before approval by the CADC. 7. Applicant must bring in evidence of paid property taxes. 32 . 8. Must not be delinquent during term of agreement. 9. Must not have been delinquent on any other previous city program. 10. One time grant to participants FGP Policies 1. The FGP incorporates public and private funding.For every one dollar the private sector invests into the City of ALTON,the CADC will match that dollar up to($5,000) 2. The maximum FGP amount will be($5,000) 3. The FGP is a cost reimbursement program where the applicant will incur the construction cost and when completed will request reimbursement from the CADC up to the grant amount approved. Evaluation In order to evaluate the applicant's request, a cover letter, detailed construction cost estimates, a site plan of the property, and a work up sheet or specification of the type of materials and colors must accompany the application for review by the CADC Board of Directors and/or its representative. The applicant will be referred to the City of Alton Planning Department for their comments and recommendations and returned to the CADC for processing. ADMINISTRATION The City Planning staff will screen design proposals and make recommendation to the CADC Board of Directors.The CADC Board of Directors will have final approval of all projects. PERIOD OF COMPLIANCE Recipients of FGP moneys must landscape, repair, repaint, renovate or improve their property grant within (3) three calendar months from the date the application is approved by the CADC Board of Directors.Funds will only be disbursed upon completion of the project.Failure to meet these requirements will result in revocation of the FGP grant. Time extension variances may be considered should extenuating circumstances arise. Requests must be made in writing and forwarded to the CADC for review and approval. PERIODIC REVIEW The Policies may be reviewed, and if appropriate amended, by the CADC Board of Directors. Failure of the CADC Board of Directors to review the policies and procedures shall not affect the validity or enforceability of the most recent policies and procedures approved. 33 CITY OF ALTON DEVELOPMENT CORPORATION APPLICATION PROCEDURES FOR FACADE GRANT PROGRAM The CITY OF ALTON DEVELOPMENT CORPORATION seeks to improve the image of the development area through the rehabilitation of facades on commercial buildings. In an effort to encourage rehabilitation,the CADC designed the following grant program as an incentive. Storefront improvement grants are available on a(50/50)matching basis with a cap of($5000)per grant. All Facade grants are cost reimbursement contracts. Grants are available to property owners and in some cases,tenants with owner's authorization and assurance.Grants will only be available as long as funds are available and will be paid in order of design approval.All applicants must submit to a peer design review process. APPLICATION PROCESS 1. Grant is based upon total dollar amount of approved construction and/or amount to complete construction.Grant will not be awarded to facade unapproved or completed projects. 2. Obtain at least two proposals from contractors.At least one proposal should be from an ALTON-based contractor. • 3. Return packet(including the attached application form and all contractor proposals)to 509 SOUTH ALTON BLVD.,ALTON,TEXAS 78573. Applicants must have all documents submitted to the CADC three(3)weeks prior to scheduling meeting. Applicants are encouraged to attend meetings. 4. If the grant applicant is accepted the CADC will mail notification of approval and award construction may begin immediately upon receipt of approval notification. Construction cost expended prior to CADC approval is not an allowable reimbursable cost. Grant will not be retroactive. 5. Approved improvements must be completed no later than ninety days after final approval and award of the grant. 6. When applicable the subject facade project has been satisfactorily completed,the contractor shall bill the CADC directly for the Programs share of the bill unless otherwise approved.(The CADC's portion of this program is tax exempt and the applicant is responsible for paying all taxes.)The applicant is responsible to pay their portion of the balance in a timely manner and the program will not pay it's share until the applicant has paid their share completely. 7. Lithe storefront is altered for any reason within one(1)year from storefront construction, the grant recipient agrees to reimburse the CADC immediately for the full amount of the grant award. 8. Taxes must be paid and up to date in order to be eligible for the grant 34 9. The following support documentation will be required for the review: Current paid tax certificates,financial statements and or profit and loss statements for the six months prior to the application,and any lease agreements owner my have on property. 10. Applicant must provide proof that he/she is the property owner of the proposed facility construction. I have read and understand the information above and agree to the application procedure. APPLICANT'S SIGNATURE DATE 35 FINANCING PROGRAMS - City of Hamilton, OH Brownfields Cleanup RLF Use of Brownfield Cleanup Revolving Loan Fund(BCRFL)dollars is limited to sites that have an actual release or substantial threat of release of a"hazardous substance"into the environment.BCRLF funds may be used at sites that are either publicly owned,either directly by a municipality or indirectly through a quasi-public entity;or privately owned and with clear means of recouping BCRLF expenditures. Commercial RLF The City of Hamilton's Revolving Loan Fund(RLF)provides low interest loans for expansion projects by private,for-profit businesses occurring in Hamilton.Loans are made primarily for the purchase of machinery and equipment,although purchase, renovation and/or construction of buildings are also eligible. Design Assistance Program The City of Hamilton's Design Assistance Program provides business owners interested in renovating existing buildings with a grant of up to$2,500 to be used for professional architectural/technical services.This program is intended for small businesses, with 30 or less full-time equivalent employees. Ohio Enterprise Bond Fund The enterprise bond fund provides revenue bond financing through an S&P rated fund,whereby proceeds from the sale of bonds are loaned to companies for fixed-rate,long-term capital asset financing. Ohio GrowNow Program When a business is approved for a loan at an eligible bank,GrowNow provides an additional three percent discount on the loan's already negotiated interest rate.The program can be used by businesses that are organized for profit,have less than 150 employees and are headquartered in Ohio.Maximum loan is$400,000 and there is no application deadline. Ohio Minority Business Direct Loan Program The Ohio Minority Business Direct Loan program provides fixed,low-interest rate loans to certified minority-owned businesses that are purchasing or improving fixed assets and creating or retaining jobs. 166 Direct Loan The 166 Direct Loan provides loans for land and building acquisition,construction,expansion,or renovation,and equipment purchases for eligible businesses.The program provides low-interest loans up to$1.5 million. Regional 166 Direct Loan The Regional 166 Direct Loan provides loans for land and building acquisition,construction,expansion,or renovation,and equipment purchases for eligible businesses.Local economic development agencies administer the program.It provides low- interest loans up to 75%collateral value,not to exceed$500,000. SBA 504 Loan The SBA 504 loan offers long-term financing at a below-market rate.Possibilities with this loan include real estate acquisition, new construction,renovation of existing buildings,machinery and equipment acquisition,and project-related soft costs. Design Assistance — City of Hamilton, OH In order to encourage the establishment of for-profit,new businesses and the expansion of existing businesses in the City of Hamilton, the City created and implemented the Design Assistance Program.The program provides business owners interested in renovating an existing or constructing a new building with a grant of up to$2,500,to be used for professional architectural/technical services. Design services eligible for funding include those that provide the following. •Floor plans showing existing and/or new construction; •Building facade improvements;and •Preliminary building,zoning and safety code analysis. Qualifications for Funding •Small business must have no more than 30 employees •Personal financial statement is required from all applicants •Grant proceeds may not be used for in-house or staff design •Business plan must be submitted •Project must be consistent with zoning requirements and business district plans •Only one grant per business address per year •Minimum project investment of$10,000 36 •Maximum grant award is$2,500 •Project must be completed within 12 months of the filing of the application •Applicant is required to file a$250 application fee,which is refunded upon the issuance of a certificate of occupancy Process The following is the basic process of the Program: •Business owner files their application •City reviews application and give go-ahead to proceed •Small business owner selects their design professional •Design professional completes plans and permits are issued •Small business owner submits paid invoices for design services •City reimburses owner for invoices after construction in underway •Application fee is refunded upon issuance of certificate of occupancy Iconic Sign Signage on Route 4 In an effort to promote a"Sense of Place,"the City of Hamilton has designated the Route 4 Corridor as an"Iconic Signage District."The intent of the program is to recognize the auto orientation of the corridor and to allow businesses greater access to market themselves to consumers traveling along the state route. Allowing iconic,or"retro,"signage will provide several benefits to the corridor,including: Differentiation:The type of program will set Hamilton's Route 4 apart from other corridors in the area; Forward Thinking:Developing the corridor by hearkening back to signs and messages of automobiles glory days; Investment Reinvestment in a major north-south corridor of the region that was once the Hamilton-Erie Canal; Cohesiveness:Brings the often autonomous corridor together under a common brand; Perception:Promotes that Hamilton is"Open for Business!" To view a brochure on the Iconic Signage Program please,click here To view a map of Route 4 iconic Signage District,click here To determine if your business Is eligible contact the City of Hamilton's Economic Development Department at 513.785.7070 or econdev .aC�ihamiiton-oh.00v. 37 Programs and Incentives I Office of Economic Development Page 1 of 3 R/PWRZ5/776- di Home I About I Contact Us Share:,r IVA I Efc�� + Development • MACE Swain tRlktn Mae EMT LIMGRAPICS Ii Programs and Incentives f . . .. i�_ Site Selection Assistance Business Services Based on criteria provided by the business customer,we can compile a list of potential sites for Business Liaison Service consideration,advise on zoning code and provide feedback about the need for additional permitting Pre-Development measures such as a Conditional Use Permit,Parking Study or Variance that can help the customer Meetings compare sites knowledgeably and make the best decision for their business location. Fast Track&Expedited Service Business Liaison Service Riverside Micro Loan At the heart of the Business First Philosophy is the dedicated Business Liaison. The City's Office Program of Economic Development staff Is part of a larger Business First Team of professionals ready to Steps for Startups answer questions and provide guidance. Whether your business is relocating,expanding or Doing Business in developing a new project in the City of Riverside,the Office of Economic Development offers a Riverside reliable single point of contact through every stage of the process from site selection and resource Business Plan Template recommendations through permitting and final inspections. (Printable) Pre-Development Meetings Business Resource Guide (Printable) Available to business customers based on individual need,we can pull together a team representing the departments critical to your project that will provide detailed analysis and review of your tenant improvement or new construction plans before they are formally submitted to the City. This round-table review can save a business money and time by reducing the number of plan check revisions and developing a reasonable project timeline. Fast-Track Permitting and Review The Fast-Track Processing Team is composed of department heads or representatives with decision-making authority to fast track°the permitting process of specific,qualified commercial and industrial projects,waiving overtime charges for weekend inspections during the construction and/or tenant improvement installation process.Fast-Track projects are evaluated based on Job creation, investment and sales tax generation criteria. Expedited Plan Check and Inspection 38 http://www.riversideca.gov/econdev/programs-and-incentives/ 3/18/2013 Programs and Incentives I Office of Economic Development Page 2 of 3 While only specific projects will qualify under the Fast-Track Program,the City of Riverside strives to give efficient service to every project and provides the option for all businesses to apply for expedited service. Applications for after-hours plan check service are reviewed and approved based on staff availability.The applicant pays the hourly rate for plan check staff to review their project on an exclusive basis outside of normal business hours. For more information on expedited service in any department,contact one of our Business Liaisons. Technology Ombudsman Service Whether the need is access to capital,site selection assistance,or networking with local leaders; the Technology Ombudsman's goal is to support the growth of local technology companies, entrepreneurs and start-ups. The Technology Ombudsman acts as a concierge to existing tech companies as well as those looking to establish a presence in Riverside,providing a critical single point of contact for a variety of services.The Technology Ombudsman is one of several resources the City has committed to help innovation succeed and allow Riverside to become a center of high technology in the region. Riverside Public Utilities(RPU)Economic Development Rate The Economic Development rate is available for qualifying businesses that are either expanding locally or relocating to the City of Riverside. it requires a four-year commitment to remain in the City.The contract offers a 40%discount per month for the first year of operation and a 20% discount per month the second year. The discount discontinues in the third and fourth years and will adjust to the appropriate existing rate schedule. To qualify for the Economic Development Rate your business must • Relocate to Riverside bringing 500 kW of monthly electric demand or • Expand your existing business'electric demand by 150 kW or 20%,whichever Is higher or • Relocate a qualified research or technology company to Riverside or • Relocated a green technology or manufacturing company For more information on all of Riverside Public Utilities programs and incentives click here. Commercial Building Permit Fee Rebates Qualified applicants pre-approved for this program can receive up to 50%of Building&Safety Department issued permit and plan check fees as rebates on new ground-up development projects if the Certificate of Occupancy is granted within 12 months of permit issuance or 25%if within 18 months of issuance. Sewer Treatment Rate Incentive This program helps local businesses with large water and sewer consumption partially offset the costs of operating leaner by reducing the volume and strength of generated emissions.The City can offer qualified companies up to a 50%rebate on the purchase of pretreatment equipment not to exceed$50,000 per year upon submission of a cost/benefit analysis for equipment purchases and verification of reductions through the City's monthly treatment reporting process. Business Contracting and Procurement The City processes nearly$75 million($25 million in goods and services and$50 million in Public Works projects)in orders and contracts annually.Services utilized include but are not limited to janitorial services,security services,landscape maintenance,printing,temporary staff services,air travel services and courier services.Public projects include street repairs,special studies and 39 http://www.riversideca.gov/econdev/programs-and-incentives/ 3/18/2013 Piograms and Incentives I Office of Economic Development Page 3 of 3 construction of buildings,engineering,geo-technical and environmental services.To be part of the competitive bidding process the City has easy electronic access to the official Bidders List Municipal Internship Program Through the Municipal Internship Program,the City of Riverside provides college and university students with the opportunity to work side-by-side with City staff,learn about local government,and gain professional experience while going to school. Inclusive Marketing Campaign/Business Promotion Through an ongoing series of city-wide promotional campaigns including an initiative to encourage local shopping,informational City newsletters,organizing special business fairs and receptions and regular City Council business recognition presentations,the City of Riverside proudly promotes and supports local businesses. Office of Economic Development Share: ' ® t 3900 Again St. 7th Floor- Riverside, CA 92522 (877) RlvSide I econdev(Siriversideca.00v Subscribe to our newsletter ii City of Riverside I Explore Iverside,I Seizing Ou Destiny Copyright®20121 AR rights reserved • • • http://www.riversideca.gov/econdev/programs-and-incentives/ 3/18/2013 40 0 0 N W •c •c 0 -, Z c c 0 J a V > In C Si CI C C c0 c E y. c co a co N !�_- O o Co c o mY No -o tip < N 5 c Y ° al al 0) IA O a) c Yn ❑ o co >EE c i o c 0) 0 0 CO w �o YO ocn -0 ccoo ai 2 off - a) i E ° o •c � 2 a) € ❑ a0) u) V ca co z N U � AN * o >Jo co .c V? oo - u. -a .� coO co Z Cl) F- c `m 2 c 0 5 °- s vi °° �` E o - o E W a to m -t >.:, E � i U) °e 0 � -� � o uo. voi 0 n a0i a a) ° = 0) u. a) 5 C.) a) ti cn. c � cu. o � � Vvi owaci U2E m ° d CO O x m o •C a) <C c 3 fl. a a) = a) c a Y c a W V 0) F- ° — Om 'c c m +. p 0 " N 0 o O Fii Co a - - > 3 00i o a).oc Ca I—. o Cl)c � �" �- � = V `m �Fo- E c c -vm .°c a) a) " =° JYu. c o co Q c Q. cs) ° > a c`o C7 Co � W � U LLm E O �_- m W co Q 0 o a = > cc Z O 3 .0 0 Z c c p_, O 0 >C 17- a c W V Y «. 0 0 Co o ca O al °� ° ❑ 0 -•I a. ED. fx c co .• Z J a) u o co ° �- o CO N O I �, Co W Y c •c I c�) co I— W co = " ~ E o a i a c W W o I— o c i 5 co a. ca � ti v U ~ c o L7 .E F. ° a) M c s °tS i c .c s W 3 = 3 5 v -c n a) •C i = 'co -a o Et oV o 0 0 0 0 0 o o co 0 ❑ v� ❑ 0) cn z Z co z W CO 2 5 ❑ cn _ co N_ W P _LO P CO 0 Co U) 0) r N. P IW- c`o co Q. a. a co n r D = L ci) a°i i < 2 < < 2 2 - P -, —, Q Q d CO CO 0 0 m ❑ 0 0 0 0 0 0 0 0 0 0 +' o o E o 0 m 0 0 M s Y Y .Y Y Y Y Y .Y Y Y 7 Y Y Y Y C r L a) a) — a) a) >. a) a) 2 a) 0 >, a) a) a) a) a) 0_ Cl) a) ,r•, a) a)a) cis 0