7.3. SR 07-20-2015 - Laserfiche WebLink

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This project will strengthen the local economy through increased tax base, the retention of over 200 well -paying jobs, and the creation of a minimum of 72 new FTE by the end of 2017 between the two buildings. This does not include any additional employees hired with the planned acquisition (as described below) in 2016. Currently, Sportech contributes over $320,000 annually in property taxes between the two buildings. Preliminary tax estimates anticipate the new facility will generate a minimum of $216,383 in taxes per year. Upon project completion, its current headquarters, and new building (excluding proposed expansion), will contribute an estimated $330,000 per year in property tax base revenue for Minnesota. Based upon an economic impact study conducted by third -party firm CTG Research, the project will result in the following: • Create 113 indirect and induced jobs throughout the local economy, which will pay $38,757 in average annual salary, or $18.63 per hour • Increase consumer expenditures by $3,041,737 annually • Bring a total of 60 residents to Elk River • Bring a total of 151 residents to Sherburne County Combined with Sportech's existing employment of 204 FTE, total economic impact with the current facilities and proposed facilities is: • 549 direct, indirect and induced jobs • $11,659,991 in consumer expenditures annually • 230 residents in Elk River • 581 residents in Sherburne County Description of Request - City Sportech is requesting abatement in the amount of $982,720 from the City over a 20 year term. Sportech has received a written letter from ISD 728 denying their abatement request, statutorily permitting them to apply for a 20 year term. This amount was based upon the estimated valuation of the 105,000 sq. ft. facility provided by Sherburne County. Since December of 2014, Sportech has been working with city staff and the EDA on discussions to purchase the two lots in NEBC. During this process, we ran into several roadblocks, which caused us to explore options in surrounding communities. Luckily, with the help of Economic Development Director Amanda Othoudt and other elected officials, Sportech was able to reach an agreement which allows the company to remain in Elk River, and continue their aggressive growth trajectory. As indicated prior, Sportech is in the process of an acquisition (to be complete in 2016), which will result in an additional 73,500 sq.ft. expansion, expected to be completed in 2018. Per the county assessor, once the expansion is complete, the property is expected to generate $320,376/year in property taxes, broke out as follows: