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Elk REQUEST FOR ACTION <br /> River <br /> TO ITEM NUMBER <br /> Economic Development Authority 6. <br /> AGENDA SECTION MEETING DATE PREPARED BY <br /> June 17, 2013 Clay Wilfahrt,Assistant Director of <br /> Economic Development <br /> ITEM DESCRIPTION REVIEWED By <br /> Consider Tax Abatement Application and make Brian Beeman,Director of Economic <br /> recommendation to City Council for Preferred Powder Coating Development <br /> REVIEWED BY <br /> Jeremy Barnhart,Deputy Director, <br /> CODD <br /> ACTION REQUESTED <br /> Consider Tax Abatement Application and make recommendation to City Council. <br /> Option 1 -Tax abatement in the amount of$680,895, as recommended by Ehlers and Associates <br /> Option 2 -Tax abatement in the amount of$1,153,878, as requested by the applicant. <br /> BACKGROUND/DISCUSSION <br /> Preferred Powder Coating has submitted an offer to purchase 10.36 acres of land from the city for$1.67 <br /> per square foot excluding approximately one acre of land that is unbuildable due to a utility easement, for <br /> a total cost of$680,895.07. <br /> Preferred Powder is requesting tax abatement of$1,153,878 dollars over 12 years. <br /> Staff has evaluated Preferred Powder's application and has scored it as a 38 out of a possible 45 points <br /> which qualifies it as a"highly desirable"project based on the city's project priorities. <br /> Upon approval by the city and county, the EDA will be reimbursed the $680,895 market value of the land <br /> through a city and county tax abatement. The City Council is scheduled to hold a public hearing and <br /> consider the abatement application on July 1, the county has held a public hearing and plans to consider <br /> the abatement application on July 9 with land use review is expected on July 15. <br /> Because the proposed financial assistance exceeds $150,000, a Business Subsidy Agreement is required by <br /> state statute. The Business Subsidy Agreement will require the applicant to create a minimum of 8 jobs <br /> and retain their existing 24 jobs. They will need to retain the jobs for a minimum of one year. All of the <br /> jobs must pay wages greater than $12.19 per hour. Preferred Powder stated that they intend to pay an <br /> average wage of$15 per hour. <br /> FINANCIAL IMPACT <br /> In accordance with the city's Tax Abatement Policy, Ehlers and Associates, Inc. completed a but for analysis <br /> and financial projection for the tax abatement project. They concluded that at an estimated market value <br /> of$4,100,000, the project will generate enough abatement revenue to repay the EDA within 10.5 years at <br /> POIVERER Rr <br /> NAME <br />