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Looking at past projects Elk River has granted abatement to,this is a comparable request. Since 2004,
<br /> Elk River has granted abatement to twelve businesses,with terms ranging from 10-15 years.
<br /> Businesses who received abatement for 15 years include:
<br /> • Envision Company, LLC(Sportech).$460,000,total of$920,00 with County abatement
<br /> • O'Brien Holdings (CDI),$138,470,total of$276,940 with County Abatement
<br /> • Medical Extrusion Technologies, $114,998,total of$229,996 with County abatement
<br /> • Provo Enterprises(Alliance Machine),$103,978, total of$207,956 with County abatement
<br /> Business who received abatement for 10-12 years include:
<br /> • United HealthCare, 10 years,$850,000
<br /> • The Bank of Elk River, 12 years,$195,000,total of$495,000 with County abatement
<br /> • Quality Label, 10 years,$133,947,total of$267,894 with County abatement
<br /> • Orluck Industries, 12 years, $100,760,total of$201,520 with County abatement
<br /> Morrell's longstanding presence in the Elk River community,existing jobs and average hourly rate far
<br /> exceed past projects receiving abatement.
<br /> The most recent tax incentive provided to an Elk River business was Preferred Powder Coating,who
<br /> received approximately$1.15M up front,with a total project cost of over$6M,or 19%of the total
<br /> project cost. Morrell's request is 8.9% of total project cost.
<br /> Morrell Oversize is also applying for tax abatement from the Sherburne County,to help offset the cost
<br /> of their$2.38M project,and ensure their long-term success. The attached projections demonstrate the
<br /> need for the pay-as-you-go abatement over the course of 15 years.
<br /> Initial scoring on the City's current tax abatement applications shows the project scoring a minimum of
<br /> 30(moderate desirability),assuming worst case scenario for question 10. In the 50 years of operation,
<br /> Morrell Companies has never applied for, nor received, any business subsidies to operate their business.
<br /> How the Project Meets Public Purpose
<br /> This project serves four of the public purposes as outlined in the City of Elk River Tax Abatement
<br /> Application:
<br /> Job Creation/Retention
<br /> Upon completing their expansion, Morrell Companies anticipates hiring 8 FTE within two years,
<br /> averaging$23.21/hr. Additional job creation is outlined above.
<br /> Enhancement and/or diversification of the City of Elk River's Economic Base and Significantly increases
<br /> the City's tax base
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