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HomeMy WebLinkAboutResolution No. EDA 02-01 -ARI I EEN HILLS CITY OF ARDEN HILLS ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION NO. EDA 02-01 ESTABLISHING A POLICY REGARDING BUSINESS SUBSIDIES WHEREAS,Minnesota Statues, Sections 116J993 through 116J995 (the"Statutes") require the adoption of criteria for the granting of business subsidies as defined in the Statues: WHEREAS, the Arden Hills Economic Development Authority(the "EDA")has determined that it is necessary to adopt business subsidy criteria pursuant to the Statutes; and WHEREAS, The EDA has performed all actions required by law prior to the adoption and approval of the proposed business subsidy criteria, including the holding of a public hearing upon published notice on November 27th, 2002. • NOW, THEREFORE, BE IT RESOLVED by the Arden Hills EDA that the business subsidy criteria contained in Exhibit A of this resolution are hereby approved, ratified, established, and adopted and shall be placed on file at the Arden Hills City Hall. Adopted this 9th day of D embe , 2002. DLIAN PROBST,PRESIDENT ATTEST: 1 JO EP P. LYNCH, tXECUTIVE DIRECOR Exhibit A • 1. Balancing public, residential, commercial and industrial land uses. 2. Increasing tax base values through rehabilitation and redevelopment. 3. Returning vacant land, exempt or under-used land to productive, taxable uses. IV. General Business Subsidy Evaluation Criteria A. All business subsidies granted by the Economic Development Authority shall require compliance with the requirements of the Act and this policy. At its discretion, the Economic Development Authority may waive the requirements of this policy for those subsidies that are statutorily exempted from the requirements of the Act. Statutory exemptions of the Act are outlined in Appendix 1. B. All projects must be consistent with the Arden Hills Comprehensive Plan and any other similar plan or guide for development of the community. C. Business subsidies must be justified by evidence that the project cannot proceed without the benefit of the subsidy. If tax increment financing (TIF) is used to grant a subsidy, the grantee must demonstrate compliance with all statutory requirements of the TIF Act, including the "but for"test, and any TIF policy adopted by the Economic Development Authority. The grantee shall provide to the EDA all documentation necessary under the Act. • D. Grantees will be required to enter into an agreement with the EDA which is consistent with statutory requirements, including a commitment to remain in business at the site for a minimum of five years after the benefit date and compliance with the specific job and wage goals established for the project. E. While it is recognized that the creation of good paying jobs is a desirable goal, it must also be recognized that not all projects derive their public purposes and importance solely by job creation. The imposition of high job creation and wage requirements may be unrealistic and counterproductive in the context of larger economic forces and financial and competitive circumstances of an individual business. V. Specific Business Subsidy Criteria The EDA recognizes that every proposal is unique. Nothing in these criteria shall be deemed to be an entitlement or shall establish a contractual right to a subsidy. The EDA reserves the right to modify these criteria from time to time and to evaluate each project as a whole. The following criteria shall be used in evaluating a request for a business subsidy: A. Increase in tax base. While an increase in the tax base cannot be the sole grounds for granting a subsidy, the EDA believes that it is normally necessary to grant a • subsidy. Exhibit A B. Job and Wages. It is the EDA's intent that the grantee shall create the maximum number of livable wage jobs at the site. All jobs to be created under the agreement must meet or exceed 150 percent of the federal minimum wage requirements plus benefits. This may include jobs to be retained but only if business and job loss is imminent and demonstrable. Other factors to be considered in setting job and wage goals include: 1. Prevailing wage rates; 2. Local economic conditions; 3. External economic forces outside of local control; 4. Business or labor circumstance unique to the grantee. VI. Business Subsidy Agreement Requirements A. All business subsidy agreement shall contain the following: 1. A description of the subsidy, including type, amount and type of district if TIF; 2. A statement of the public purpose for the subsidy; 3. A statement of why the subsidy is needed; 4. Goals for the subsidy, including jobs and wages 5. A description of the financial obligation of the recipient if goals are not • met; 6. A commitment to continue operations at the site for five years; 7. Name and address of the parent corporation of the recipient, if any; 8. A list of financial assistance by all grantors for the project; 9. Annual reporting requirements. B. Specific job and wage goals to be completed within two years include: 1. Number of jobs to be retained, if loss is imminent and demonstrable; 2. Number of jobs to be created; 3. Wage rates to be attained. VII. Compliance and Reporting Requirements A. Any subsidy granted by the EDA will be subject to the requirements of a public hearing, if necessary, and must be approved by the Arden Hills Economic Development Authority. B. Both the grantee and the EDA shall comply with reporting and monitoring requirements of the Act. • APPENDIX 1 EXEMPTIONS FROM THE BUSINESS SUBSIDY ACT The Business Subsidy, Act at section 116j.993, subdivision 3, exempts the following forms of financial assistance from the limitations of the Act: 1. A Business subsidy of less than $25,000; 2. Assistance that is generally available to all business or to a general class of similar businesses, such as a line of business, size, location, or similar general criteria; 3. Public improvements to buildings or lands owned by the state or local government that serve a public purpose and do not principally benefit a single business or defined group of businesses at the time the improvements are made; 4. Redevelopment property polluted by contaminants as defined in section 116j.662, subdivision 3; 5. Assistance provided for the sole purpose of renovating old or decaying building stock or bringing it up to code,provided that the assistance is equal to or less than 50 percent of the total cost; 6. Assistance provided to organizations whose primary mission is to provide job readiness and training services if the sole purpose of the assistance is to provide those services 7. Assistance for housing; 8. Assistance for pollution control or abatement; 9. Assistance for energy conservation; 10. Tax reductions resulting from conformity with federal tax law; 11. Workers' compensation and unemployment compensation; 12. Benefits derived from regulation; 13. Indirect benefits derived from assistance to educational institutions; 14. Funds from bonds allocated under chapter 474A(qualified tax exempt bonds); 15. Assistance for the collaboration between a Minnesota higher education institution and a business; 16. Assistance for a tax increment financing soils condition district as defined under section 469.174, subdivision 19 (pollution clean-up); 17. Redevelopment when the recipient's investment in the purchase of the site and in site preparation is 70 percent or more of the assessor's current year's estimated market value; and 18. General changes in tax increment financing law and other general tax law changes of a principally technical nature.