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HomeMy WebLinkAboutDocumentation_Regular_Tab 10H_5/9/1996 1,q Memorandum To : Village Council From: Thomas G. Bradford, Village Manager / Date : April 8 , 1996 Subject : North County Economic Development Group; Proposed Tax Incentive/Economic Development Plans Attached hereto, please find a copy of correspondence from the Finance Director of the City of Palm Beach Gardens dated April 4, 1996, pertaining to the above referenced subject . The North County Economic Development Group is interested in receiving feedback from the Village Council on its views relative to these draft programs and whether or not the Village Council is interested in establishing economic incentives such as those referenced in the attached materials . This information is being provided to you at this time to enable the Village Council to have sufficient time to think about the issues and/or discuss the same with various people within the community. This item will be placed on the Agenda of the Village Council Meeting in May of 1996 . If you feel that this subject warrants a review by either the Finance and Administration Committee or the Redevelopment Committee before or after your May Village Council Meeting, please share your thoughts with me in this regard at your earliest convenience. TGB/cm " L-,77---",,,4) ...0A, `i . ) F PP, ! 13 L., 1"=,C" !--J . A P d_. E N S /!'�� `�-- 10500 N.MILITARY TRAIL • PALM BEACH GARDENS,FLORIDA 33414469e April 4, 1996 Mr. Thomas Bradford Village of Tequesta Village Manager Village of Tequesta APR — 5 1996 357 Tequesta Drive P.O. Box 3273 Village Manaeer s Office Tequesta, FL 33469-0273 Dear Tom: Enclosed please find a memorandum outlining a possible economic development incentive program which was discussed at today's bi-monthly meeting of the North County Economic Development Group. The proposed Tax Abatement Program was developed by a group of North County finance directors (including Bill Kascavelis) who met several times last year. The proposed Inter-Governmental Development Board was created based upon discussions at the Group's November 2, 1995 meeting in Juno Beach. The Economic Development Group is interested in receiving feedback from your Village Council of its views of these draft programs and whether or not your Village Council is interested in establishing economic incentives such as these. The North County Economic Development Group would like to receive input regarding these proposals and an indication of interest or non-interest in time for its next meeting, scheduled for 8:30 a.m. on Thursday, June 6th, at the Riviera Beach City Hall, 600 W. Blue Heron Blvd., Riviera Beach. If there are any questions, please call me at 775-8203. Thank you for your consideration and we look forward to having an official from your community attend and participate in our discussion to improve the North County economy on June 6th in Riviera Beach. Sincerely, /,, J •n ; 1 Kent R. Olson Finance Director Encl. A► ti MEMORANDUM TO : Joseph R. Russo, Mayor • FROM .• Kent R. Olson, Finance Director Kg:,) SUBJECT : Tax Incentive/Economic Development Plans DATE April 3, 1996 INTRODUCTION As you are aware, the Finance Directors from the North County area (Juno Beach, Jupiter, North Palm Beach, Palm Beach Gardens, Riviera Beach and Tequesta; Lake Park's position has been vacant until recently) were charged with developing a tax incentive plan for the North County area. The outline of this program was presented at the North County Economic Development Group's meeting of November 2, 1995. At that meeting, however, there was also discussion of a more complex and regional approach to the issue of economic development or redevelopment. Below I will present these two approaches as well as discuss the pros and cons of each. TAX ABATEMENT PROGRAM The program developed by the North County Finance Directors is designed to be easy to administer and is targeted to employers who will bring a significant number of new jobs to Palm Beach County. The North County Tax Abatement Program would have the following tenets. 1 . The prospective business would have to qualify for Palm Beach County's Tax Exemption Fund (their Tax Abatement Program). 2. The tax abatement shall be for a period of five to ten years. The exact length of the abatement shall match that provided by the County program. 3. The prospective business must bring a minimum of fifty (50) new jobs to the North County area. 4. The business and jobs must be moving into the North County area from outside of Palm Beach County. 5. The business would receive twice the abatement available of municipal taxes if the property was to be redeveloped than a property that was a new development. For example, the program may provide for a 50% abatement for redevelopment projects and a 25% abatement for new development projects. PROS 1 . To qualify for the municipal program, the company would need to qualify for the County program, eliminating duplicative application and review processes. 2. If all North County governments adopt the above program, any business locating in the North County area would have the same incentive package regardless of the community chosen by the business. 3. Provides a tax inducement for companies to locate in the North County area. CONS 1 . The program does not steer development or redevelopment to selected areas (Riviera Beach and Lake Park, for example) and provides an incentive in communities which are already attractive for development (Jupiter and Palm Beach Gardens). 2. Different property tax rates will provide competing incentives among the North County cities. For example, a company contemplating a move to either Palm Beach Gardens or Jupiter, the benefit offered in Palm Beach Gardens is almost twice as much as that available in Jupiter. 3. Voters may approve the program in some communities but not others, providing a system of uneven incentives in the North County area. IMPLEMENTATION Each community would need to hold a referendum on the provisions above. INTER-GOVERNMENTAL DEVELOPMENT BOARD An alternative, or perhaps a supplement, to a tax abatement program would be the creation of an inter-governmental agency to provide various incentives and inducements for development or redevelopment. The agency would be governed and have the authority as outlined below. 1 . The agency would have the power to determine and collect contributions from the member communities based upon an agreed formula. 2. A representative from each community's government shall.be a voting member of the governing board of the agency. 3. The approval of expenditures would require a 2/3 vote of the agency's membership. 4. The agency would be permitted to expend funds for several purposes, including, but not limited to: 1) job training, 2) extension of utilities, 3) direct incentive grants, 4) improvements to roads, streets and other infrastructure, 5) low-interest loans, 6) property acquisition and clearing, 7) public safety improvements and 8) other financial and technical assistance. PROS 1 . Provides a regional funding mechanism for worthy projects in the North County area. 2. Directs funds specifically for economic development or redevelopment in a more flexible form to encourage public/private partnerships. .3. Offers a regional approach to economic development or redevelopment of the North County area. CONS 1 . The expenditure of funds outside the community may be resisted by voters. 2. This option will require a time commitment from the staff of the participating communities. 3. All seven communities must participate to create a truly regional agency. IMPLEMENTATION -To implement such a program, the seven North County communities would be required to negotiate and adopt an interlocal agreement creating the development board.