9.0. HRSR 09-23-2002 - Laserfiche WebLink

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✓ If a business subsidy benefits more than one recipient, the grantor must assign a proportion of the subsidy to each recipient signing the agreement. If the grantor is a local government agency, the agreement must be approved by the local elected governing body, except for the St. Paul Port Authority and a seaway port authority. Also, subsidies in the form of grants must be structured as forgivable loans. For other types of business subsidies, the agreement must state the fair market value of the subsidy or other in-kind benefits. ✓ In addition to any criteria developed in compliance with this law, agencies may be subject to additional criteria required by specific assistance programs such as the Community Development Block Grant(HUD)and Minnesota Investment Fund programs. Agencies may or may not choose to address specific program criteria in the criteria developed in compliance with this law. What happens if a recipient does not meet business subsidy goals? ✓ Business subsidy agreements must specify the recipient's obligation if the recipient does not fulfill the agreement. At a minimum, a recipient failing to meet goals must pay back the assistance plus interest or, at the grantor's option, to the account created under Minn. Stat. §116J.551 provided that repayment may be prorated to reflect partial fulfillment of goals. The interest rate must be set at the Implicit Price Deflator rate as defined in Minn. Stat. §275.70, Subdivision 2. DTED will provide information on the Implicit Price Deflator on its website. ✓ Recipients failing to fulfill business subsidy agreements may not receive business subsidies from any grantor for five years or until they have satisfied their repayment obligation,whichever occurs first. Who is required to report business subsidies, and how? ✓ Recipients must provide grantors with information on their progress toward goals outlined in the agreement, and will be subject to a penalty as defined in Minn. Stat. §116J.994, Subdivision 7(d)for failing to report. ✓ Grantors must submit the annual Minnesota Business Assistance Form (MBAF)to DTED for each • business subsidy agreement signed on or after January 1,2000. DTED will ask grantors to file an MBAF each year for each agreement for two years after the benefit date or until all goals outlined in the agreement have been met,whichever is later. ✓ Local government agencies in communities with a population of more than 2,500 and state government agencies must submit an MBAF regardless of whether they have awarded business subsidies. The form will ask agencies whether they have awarded any subsidies. Local government agencies in communities with a population of 2,500 or less are exempt from filing the MBAF if they have not awarded a subsidy in the past five years(i.e. those with a population of 2,500 or less who have not signed an agreement after December 31, 1996,will be exempt from reporting in 2001). ✓ DTED modified the 2001 MBAF in February. This form will ask,grantors to report, at a minimum, the information that Minn. Stat.§116J.994,Subdivision 7 requires recipients to provide to them, including: • the type, public purpose, and amount of the subsidy,and type of district if the subsidy is TIF (calculate TlF agreements in the present value); • the hourly wage of each job created with separate bands of wages; • the sum of the hourly wages and cost of health insurance provided by the recipient, broken down by wage level; • the date(s) by which job and wage goals will be met; • a statement of goals identified in the agreement and an update on progress toward them; • the location of the recipient prior to receiving the business subsidy; • information on why the recipient did not complete the project outlined in the subsidy agreement at its previous location, if previously located at another site in Minnesota; • the name and address of the parent corporation of the recipient, if any; and, • a list of all financial assistance by all grantors for the project. ✓ With their reports, DTED will ask grantors to include a list of recipients that did not report, as well as a list of those failing to meet any goals outlined in the agreement and a description of the steps being taken to bring them into compliance or recoup the subsidy. • ✓ DTED will post an MBAF on DTED's website and mail the form in March. If DTED has not received an MBAF by April 1 from an entity required to report, DTED must issue a warning. If DTED has still not received the MBAF by June 1,the agency in default may not award any business subsidies until the report has been filed. Department of Trade and Economic Development Page 3 of 5 February 15,2001