Minutes 01/27/2015 - Laserfiche WebLink

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January 27, 2015 WHEREAS, by Resolution R-12-38 adopted on September 11, 2012 City Council authorized the City Manager to submit an application to the Commonwealth of Virginia to modify the Incentives, and the application was subsequently submitted and approved by the Commonwealth; and WHEREAS, on January 1, 2014 the Commonwealth designated a second Enterprise Zone within the City of Portsmouth; WHEREAS, it is necessary and desirable to amend and restate the Agreement to (1) incorporate the modifications to the first Enterprise Zone approved by the Commonwealth in 2012 and (2) include the second Enterprise Zone; NOW THEREFORE BE IT RESOLVED by the Council of the City of Portsmouth, Virginia that the City Manager is hereby authorized to execute on behalf of the City an Amended and Restated Enterprise Zone Local Incentives Grants Funding Agreement with EDA to provide funding for incentive programs included in the Enterprise Zone applications previously authorized by City Council and approved by the Commonwealth of Virginia.” Ayes: Cherry, Edmonds, Meeks, Moody, Psimas, Whitaker, Wright Nays: None 15 - 49 - Adoption of a resolution authorizing the City Manager to submit an amendment application to the Virginia Department of Housing and Community Development to modify two local incentives for the City’s first Enterprise Zone. Vision Principle: A Robust Economy for Working Men and Women. Background:  The City has two zones; the initial zone was designated in 2010 and a second zone was designated in 2014. These zones are a state and local partnership to stimulate job creation, private investment and revitalization. Localities are able to make modifications to their local incentives through an Amendment Application. After four years of administering and evaluating the initial Zone and the establishment of a second zone, staff recommends making adjustments to the local incentives for the initial zone. Discussion:  Modifications to the eligibility criteria for the Business Personal Property Investment Grant (BPPIG) and the Machinery and Tool Investment Grant (MTIG) are proposed in order to stimulate utilization of these local incentives. Neither incentive has been used since their implementation in 2010. The reduction in the capital investment, job creation, and/or wage eligibility criteria for the BPPIG and MTIG will allow these local incentives to be utilized. Additionally the elimination of the target industry requirement for the BPPIG will also contribute to the utilization of this incentive. Furthermore, the City’s second zone has less stringent eligibility criteria for similar incentives. Conformity among eligibility requirements for the initial zone to those of the second zone is fair. Financial Impact:  Funds for the BPPIG and MTIG will be paid from the increase in the tax revenue from Business Personal Property taxes and Machinery & Tool taxes from the firms qualifying for the grants. The City is only required to make these payments in the event new investments are made. The payments are equal to 50% of the net new revenues for a fixed time period. Recommended Action:  Adoption of a resolution authorizing the City Manager to submit an amendment application through VDHCD to modify two local incentives. Vision Principle: A Robust Economy for Working Men and Women. Next Steps Following Council Action:  The Local Enterprise Zone Administrator will submit the amendment application to VDHCD.