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Home My WebLink About2010 06 14 Regular 600 Land Design Innovations, Inc. Presenting Summary Report For Economic Development COMMISSION AGENDA Consent ITEM 600 Informational Public Hearing Regular X June 14, 2010 MGR. /DEPT. Regular Meeting Authorization REQUEST: Land Design Innovations, Inc. (City consultant) is presenting a Summary Report for Economic Development incentives available for utilization within the City of Winter Springs. SYNOPSIS: As part of their contractual economic development efforts for the City, Land Design Innovations (LDI) has researched available federal, state, county, and city economic development incentive programs. LDI will be making recommendations for additional incentives for use in the City. CONSIDERATIONS: After their assessment of the available economic development incentives, LDI is recommending the Job Growth Incentive (JGI) program and the Microloan program as additional incentives for use by the City. A presentation on the JGI program is attached to this agenda item as Attachment A. The Microloan program would be part of the service currently provided by the Seminole County CRA and would be eligible for any business located in the US 17 -92 CRA. Winter Springs has 41 parcels located in the US 17 -92 CRA. A similar program is underway in the Winter Park CRA (In partnership with BANKFIRST responsible Banking program). FISCAL IMPACT: There is no fiscal impact associated with this agenda item. COMMUNICATION EFFORTS: No communication efforts beyond the advertising of the Commission agenda are necessary in conjunction with this agenda item. RECOMMENDATIONS: The City Commission is being asked to review and accept the information contained in this agenda item and to give direction as to which incentives to pursue further. ATTACHMENTS: "A" — Job Growth Incentive Proposal ATTACHMENT A e , - .E...k.- i ' 4 1.1,1-tellitl . . t --- - -- I . , PhieN , ‘44 ,,, .,,,, ..,„,',.,,„,,,, r " Sy 1 .' SP"' liallifigili 11 City of Winter Springs Jobs Growth Incentive 111 1141 0 , ,. 40 ilirr Proposal pi. ,,,,,, —4111111■-- 1 ir ." 4 I lillkit ' , 4 ‘ lik w I Performance Based ii ,iitte 1 ' Cash Incentive 10', , ,i.„, , 111 ' 1 -N, 1 i Program for .. of , . , WIEN II y e. , ,, . . , IA o$P 4 , ' ■ 01411 . 6 - i {, , , ,, ,..,,,, ,-.. . ., , 4,.. , Relocating or i w ' '''' - - - - ,- Expanding Targeted 1 i , , . '',, -0 ,-- " , 4 p.m.- Industries . .., ., . r., /\! \I I • - , . . t , -:i 4 ' ; * i , — , ', • — ' ' 1 i . 0 ' I 1 IhA s''' June 14. 2010 T. \ , - , II _ - 11,4. . / / .40f - / - t e 4 , 6.-___ City of Winter Springs Jobs Growth Incentive Program Proposal May 2010 Introduction 2 Overview of the Winter Springs Jobs Growth Incentive Program 3 Eligibility 4 Application 5 Evaluation 6 Approval 6 Disbursement and Use of City of Winter Springs JGI Funds 7 Reporting and Performance by Winter Springs JGI Award Recipients 8 Process Summary 9 City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 1 Introduction This document presents the proposed City of Winter Springs Jobs Growth Incentive Fund program. The City of Winter Springs Strategic Plan (2010 -2012) contained specific recommendations regarding economic development. Goal 2 and the associated Strategy 12, shown below, specifically addressed the provision of economic development incentives. Goal 2: Identify opportunities and develop strategies to create a customer /businessi friendly experience. Strategy 12: Develop an Economic Development Incentive Program. Timeline: To Be Completed By 09/30/2010 Fiscal Impact: TBD Outcome: Incentivizes smart development and diversifies tax base to reduce the residential tax burden. This proposed program is designed to implement the recommendation listed above and provide the City of Winter Springs with an additional economic development mechanism to attract targeted new businesses to the City of Winter Springs and to assist targeted existing Winter Springs businesses to expand and grow. Targeted business sectors identified by City of Winter Springs's include: • Research Development And Testing • Space Technology, Aviation And Aerospace • Simulation, Modeling And Training • Laser Technology • Photonics • Computer Software And Hardware • Medical Labs And Technology • Communications • Corporate headquarters / professional services City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 2 Overview of the Winter Springs Jobs Growth Incentive Program • The Winter Springs Jobs Growth Incentive program is a cash incentive program that is available to targeted industries only. • Targeted industries must satisfy specific criteria, including minimum job creation amounts, salary levels and a job retention period, in order to apply for consideration of an award. • The incentive is an inducement to relocate or expand a facility within the City of Winter Springs. • The incentive is a "but for" incentive that must be applied for before the applicant has finalized the relocation decision process or initiated the construction or expansion of their facility. • The Winter Springs City Commission, after due diligence and evaluation of the potential economic impact of the JGI award, may at its discretion and authority approve and authorize the City to enter into a Performance Agreement with the applicant to facilitate the award of JGI Funds. • No JGI Funds may be disbursed prior to the satisfactory execution of a Performance Agreement between the applicant and the City. • JGI funds may be used to reduce impact fees costs, offset expansion costs or offset relocation costs. • The Performance Agreement will detail specific responsibilities of the Applicant that must be satisfied in order to receive JGI Funds. • An integral component of the Performance Agreement is a Performance Bond or other Surety Instrument, equal to the amount of the award that is satisfactory to the City. This Performance Bond or other Surety Instrument must be activated and maintained by the applicant during the term of the Performance Agreement. • The applicant will provide annual Performance Reports to the City of Winter Springs documenting and attesting to the satisfaction of the terms and conditions of the executed Performance Agreement. • The City may 'claw -back' the award through a call -in of the Performance Bond or Surety Instrument if the applicant does not satisfy the terms and conditions of the executed Performance Agreement. City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 3 Eligibility • Each application for consideration will be evaluated on a case -by -case basis. • Applicants must be one of the Target Industry groups identified and seeking to locate or expand their facility within the City of Winter Springs. • Non - target industries may be eligible for consideration if the proposed expansion or relocation is proposed to occur: (1) within the City of Winter Springs and; (2) within or adjacent to targeted areas (Le., Community Redevelopment Areas, SeminoleWay or other areas identified by the Winter Springs City Commission) pursuant to an adopted Resolution. • Minimum Job Creation Criteria o Relocating Companies - 25 Jobs Minimum o Expanding Companies - 10% increase over present employment o New or Start-up Companies - 3 New Jobs • Minimum Salary Criteria o Relocating Companies 115% of Seminole County Average Annual Wage (SC Avg. Wage= $38,434) (115% of Avg. Wage = $44,199 as of 4/14/10) o New or Expanding Companies 80% of Seminole County Average Wage (SC Avg. Wage= $38,434) (80% of Avg. Wage = $30,747 as of 4/14/10) o New or Expanding Companies 80% of Seminole County Average Wage (SC Avg. Wage= $38,434) (80% of Avg. Wage = $30,747 as of 4/14/10) (Average Wage Data Source: Enterprise Florida, Inc. ) • Consideration will be given to applications that propose the construction of new facilities or additions to existing facilities that provide an addition to the non - residential tax base. • In addition to the minimum eligibility criteria listed above, the City will also evaluate applications for consideration based on these additional factors: o The purchase and use of local (Lake, Orange, Osceola, and Seminole Counties)materials goods and services to be utilized in the construction or expansion of facilities; o The applicant's (Employer's) willingness to hire and employ local City of Winter Springs residents; City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 4 o The applicant's (Employer's) offering or providing healthcare, daycare and other benefits to employees; o The applicant's (Employer's) locating of the facility or expansion of existing facility within a targeted area (As identified by Federal, State, County or Local Governments and by Resolution); and, o The strategic importance of the proposed facility or expansion of an existing facility relative to the Federal, State, Regional, County or Municipal economic development efforts and objectives. • The City will consider long -term lease payments, for occupancy of a facility, as a measure of capital investment. Long -term lease (5+ years) payments represent the applicant's (Employer's) commitment to remain at the site and facility which would not have been created had the company not come to the area. Application • Applicants for consideration for participation in the Winter Springs JGI program will complete an application form requiring the following development program information for submittal: o Business Name and Federal ID Number (FEIN); o Business description and NAICS classification; o Primary Contact Information / Address; o Proposed Physical Development Program / Expansion / Relocation o Estimated Capital Investment Value of Proposed Expansion or Relocation (Includes building value, long term lease and equipment); o Timing, type and distribution of new jobs to be created, including position classification, annual wage and other benefits; o Type and distribution of existing jobs to be retained, classification, annual wage and other benefits; o Statement that "but for" the consideration of potential availability of incentives to offset development costs of the proposed expansion or relocation the Winter Springs site or facility would not be viable or under consideration; o Requested JGI Grant Amount o Anticipate Spin -Off impacts (Employee housing purchases, purchases associated with operations, etc.) o Anticipated use of local suppliers or contractors. • Applications and discussions between the City and applicants may be maintained confidential in accordance with the provisions of Section 288.075 of the Florida Statutes. City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 5 Evaluation • Completed Applications for consideration would be submitted to the City of Winter Springs Economic Development Coordinator, or designee, for a review of Application completeness and sufficiency; • A Staff level review would be prepared by the City Manager and City Attorney. • At the City Manager's discretion, the completed Application may be forwarded to the Winter Springs City Commission for consideration. • Recommendations shall include whether or not the application should be approved or denied, the amount of the award, and if approved, if any conditions are to be placed upon the award. • The City Manager, or designee, will provide a summary report of the staff level review, findings and recommendations to the City Commission for their review and consideration. • Applications for consideration to participate in the Winter Springs jobs Growth Incentive program shall be made on an Application Form that has been approved by the City. Approval • The City's Economic Development Coordinator, or designee, shall prepare an Agenda item for consideration by the Winter Springs City Commission at a regularly scheduled City Commission meeting. • Said Agenda Item shall include: o A complete and satisfactory City of Winter Springs JGI Application; o The findings and recommendations of the staff level review; o A Jobs Growth Incentive Performance Agreement that details the proposed performance criteria of the applicant and City; o The Summary Report of the staff level recommendations; and, o The anticipated ad- valorem taxes to be generated by the Project and the anticipated time period for said ad- valorem taxes to equal and exceed the award amount (Return on Investment period). • Approval of City of Winter Springs JGI Awards shall require a majority vote of the City Commission that has a quorum. City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 6 • No funds for an approved JGI Application shall be disbursed until a complete and executed Jobs Growth Incentive Performance Agreement, including a valid and satisfactory Surety Instrument, has been filed with the City Clerk. Disbursement and Use of City of Winter Springs JGI Funds • JGI Applicants that are approved by the Winter Springs City Commission to receive an Winter Springs JGI fund grant shall be required to enter into a Jobs Growth Incentive Performance Agreement, including a valid and satisfactory Surety Instrument. • This Performance Agreement will detail the specific job creation criteria, capital investment criteria, wage and salary criteria, timing, reporting requirements and other terms and conditions to satisfy, agreed upon conditions and performance objectives. • Said Performance Agreement shall have a mandatory provision for repayment of the JGI grant award to the City of Winter Springs when an approved JGI grant applicant fails to perform any condition of the Performance Agreement. • The City may 'claw -back' the award through a call -in of the Performance Bond or Surety Instrument if the applicant does not satisfy the terms and conditions of the executed Performance Agreement. • No City of Winter Springs JGI fund may be disbursed until the approved applicant has file with the City Clerk a fully executed Jobs Growth Incentive Performance Agreement and a valid and satisfactory Surety Instrument. • Disbursed City of Winter Springs Jobs Growth Incentive funds may be used for: o Reducing the cost of impact fees associated with the project; o Expansion and construction costs; and , o Costs associated with corporate relocation. City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 7 Reporting and Performance by Winter Springs JGI Award Recipients • JGI Applicants that are approved by the Winter Springs City Commission to receive an Winter Springs JGI fund grant and have filed a fully executed Jobs Growth Incentive Performance Agreement, including a valid and satisfactory Surety Instrument, with the City Clerk, will be required to submit annual Performance Reports to the City's Economic Development Coordinator, or designee, to verify compliance with the terms and conditions of the Performance Agreement. • Said Performance Reports shall utilize the form approved by the City. • Annual Performance Reports shall be due each year on the anniversary date of the execution of the Performance Agreement. Performance Report claims shall be verified and Annual Report signed by CEO, CFO or Designee. • Should the approved applicant fail to comply with the terms and conditions of the Performance Agreement, the City of Winter Springs may terminate the Performance Agreement and impose sanctions including, but not limited to, pursuit of a refund of all City of Winter Springs JGI grant monies disbursed, reimbursement of all costs incurred in the processing and administration of the project and disqualification or debarment from participation in any future City of Winter Springs grant or assistance programs. A pro -rata share of the award may be sought for partial satisfaction of the terms of Performance Agreement. City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 8 Process Summary The overall process for the proposed program is summarized below. 1. Application 2. Evaluation 3. Approval 4. Upon approval and submittal of executed Performance Agreement, disbursement and use of City of Winter Springs JGI Funds 5. Performance monitoring, submittal of Annual Reports and by Winter Springs JGI Award Recipients City Manager Recommendation Staff Level Summary Cit No A pplica ti on End c„ ti,,,ili n l Review Report Agenda Item to COmmiSSiO City orici Yes Execution of Performance Agreement and Surety • Instrument Filing of Executed Funds Requested by Not Initiate Performance Grantee Award Fund Annua Sati � Remedy Claw Agreement with City Released Report back Process Clerk Satisfactory Term Not Completed • i City Retrieves Award Repeat to / Term Term Completed • ( End ) City of Winter Springs, Economic Development Department Jobs Growth Incentive Program Proposal 9