2.1. EDSR 12-17-2018 - Laserfiche WebLink

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Request for Action To Item Number Economic Development Authority 2.1 Agenda Section Meeting Date Prepared by Work Session December 17, 2018 Amanda Othoudt, EDD Item Description Reviewed by Energy Incentive Program Cal Portner, City Administrator Reviewed by Action Requested Discuss implementing an Energy Incentive Program as an attraction and retention tool for new businesses. Background/Discussion The City of Elk River Economic Development Authority and the City of Elk River maintain a goal to stimulate private sector investment for new job creation and tax base growth. Elk River Municipal Utilities was purchased by the city in 1945 and separate governance was created in 1947. It is typical for a municipal utility to provide a payment in lieu of taxes (PILOT) regardless of the separation of governance. The PILOT is calculated based on eligible electric sales within the city. Staff collaborated with ERMU and Sherburne County in developing a new Energy Incentive Program utilizing PILOT. The Energy Incentive Program would be a city incentive to waive PILOT as a development tool for new businesses meeting very specific criteria. As an economic development incentive option, the city would agree to waive the applicable PILOT for an approved applicant and redirect that amount as a credit distributed through the applicant’s monthly ERMU electric service bill for up to two years. The amount of the incentive shall be determined by ERMU in its sole discretion in consultation with the city. For the applicant to be eligible for this incentive, the business must be located within the ERMU electric service territory in which the electric sales are included in the calculation for the PILOT. For the applicant to be eligible the project must meet all other applicable prevision of the ERMU PILOT policy. The city must be eligible to receive PILOT for the location to be able to waive PILOT for the project. The Energy Incentive Program would offer a savings to qualified applicants on their Elk River Municipal Utilities (ERMU) electric bills for up to two years. The specific project criteria as follows:  Project Design - Evaluation of project design will include review of proposed activities, time lines and a capacity to implement the project. The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity