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The Elk River Vision <br />A welcoming community with revolutionary and spirited resourcefulness, exceptional <br />service, and community engagement that encourages and inspires prosperity. Updated: January 2023 <br />Request for Action <br />To <br />Joint Finance Committee <br />Item Number <br />4.2 <br />Agenda Section <br />General Business <br />Meeting Date <br />March 28, 2023 <br />Prepared by <br />Brent O’Neil, Economic Development Director <br />Item Description <br />Review Application – Beaudry Lubricants/Harvest <br />Reaper <br />Reviewed by <br />Joshua Mollan, Economic Development Specialist <br />Reviewed by <br />Action Requested <br />Provide a recommendation, by motion, to the EDA and City Council regarding the financial review of the <br />attached tax abatement application. <br />Background/Discussion <br />The City of Elk River has received a tax abatement application from Beaudry Oil to operate a new lubricants <br />operation at new site on Elk Lake Road, approximately one-half mile north of its current operations. The new <br />venture would be operated as Beaudry Lubricants, with the property to be developed and owned by Harvest <br />Reaper, LLC. The abatement request was submitted to both the City and Sherburne County for a total amount of <br />$645,000, citing extraordinary site development costs due to wetland configuration and mitigation on the site, and <br />the necessity of a water main extension from Industrial Blvd. to provide adequate water suppression systems. <br />Mikaela Huot of Baker Tilly has reviewed the application and submission materials. Ms. Huot’s memo is attached <br />and she will be present to provide additional information on the project. In summary the Baker Tilly review advises <br />a total city abatement amount of $138,204, or 100% abatement for 11 years. Sherburne County will be considering <br />abatement at a future meeting. Should both the city and county approve abatement at the recommended levels, the <br />total amount of abatement would be approximately $200,000 over 11 years. Also attached is scoring rubric showing <br />a score of 37 out of 45, for a designation of a medium rating and maximum city abatement eligibility of 75%. <br />Financial Impact <br />The project requested $645,000 in tax abatement, with one-half being requested through the City’s abatement <br />program. <br />Mission/Policy/Goal <br />Support Elk River’s existing businesses through relationship building, programmatic offerings, and high-quality city <br />services. Attract new business development to Elk River to build the City’s economic vibrancy, job offerings and <br />tax base. <br />Attachments <br />Application from Beaudry Oil (Beaudry Lubricants/Harvest Reaper) and Completed Scoring Rubric <br />Financial Consultant Review Memo <br />Property Area Map <br />Supplemental Information