HENDERSON COUNTY BOARD OF
COMMISSIONERS ECONOMIC DEVELOPMENT INCENTIVES
GUIDELINES
Following are the guidelines which will be used by the Henderson County Board of Commissioners in evaluating requests received for economic development incentives. The guidelines are meant to generally guide the process of determining which requests fit within the mission of Henderson County Government. Award of economic development incentives will be at the sole discretion of the Henderson County Board of Commissioners.
1.
The guiding principal for Henderson County's economic development incentive
program is that the industrial enterprise seeking economic development
incentives (AIncentives@) must expand the property
tax base, and create more and better jobs in Henderson County.
The Incentives must be legal and will be available to both new
and existing businesses seeking to expand or retain
jobs.
2. Henderson County will establish an Economic Development Fund which
will allow for transfers from the General Fund or other funds for the
purpose of the promotion of local economic development.
3. Henderson County will consider providing
Incentives to both new and expanding industrial enterprises (AEnterprise(s)@) in Henderson County. Any Incentives awarded will be at the discretion
of the Board of Commissioners (ABoard@) upon a determination that the Incentives are a motivating
factor in the Enterprise=s decision to locate or expand in Henderson County.
These enterprises may include manufacturing, assembly, fabrication,
processing, research and development, warehousing, software development,
information technology, corporate headquarters, or any other Enterprise
as allowed by N.C.G.S. 158-7.1 at the discretion of the Board.
Commercial and retail establishments will generally not qualify for
Incentives.
4.
New or expanding Enterprises should produce
a new taxable capital investment of $500,000 dollars in real and/or
personal property. [Note: This requirement can be waived in the event
the Incentives are for job retention only. The Board may also decide
to waive this requirement for a new or expanding Enterprise for any
of the reasons listed in Paragraph 9.]
5.
The Enterprise should create or retains
at least 25 new jobs within the first two years of operation after the
Incentives are granted. All of these jobs must be at 100% of the median
average wage for all insured industries in Henderson County, as established
by the Employment Security Commission. [Note: The Board may decide to
waive these requirements for any of the reasons listed in Paragraph
9.]
6. Incentives granted will be paid primarily
on a reimbursement basis over a period of years to the Enterprise.
Only activities authorized by N.C.G.S. 158-7.1 will qualify for
reimbursement. However, at the discretion of the Board Incentives may be paid
by the County up front as authorized by N.C.G.S. 158-7.1. All Enterprises are required to pay all property
taxes and all development fees associated with the project.
7. An Enterprise seeking to qualify for Incentives
must provide Henderson County with a written statement which includes
the following information:
(1) estimated tax value of
the facility to be constructed; (2) estimated tax value of
equipment to be installed; (3) estimated cost of design,
construction, and/or implementation of anything for which the Enterprise
will be seeking reimbursement in the form of Incentives; (4) explanation of what products
or service will be produced at the facility; (5) the number of jobs to
be created and the hourly rates to be paid and benefits to be provided
for these jobs; (6) estimated schedule for
completion of construction; (7) and a preliminary site
plan of the proposed facility.
8. The Enterprise seeking to qualify for
Incentives must receive approval from the Board of Commissioners through
the required public hearing process prior to making any irrevocable
commitments toward the project (i.e. the location, the expansion, or
the retention of the Enterprise) in order to be eligible for Incentives.
9. The Board of Commissioners will consider
granting Incentives to new or expanding Enterprises in accordance with
the Annual Incentives Formula on a reimbursement basis. The Board will
have discretion to determine the number of years for which Annual Incentives
will be paid. However, the Board has the discretion to pay all Incentives
up front, rather than on an annual basis. In addition, the Board may
award bonus Incentives to the Enterprise for any of the following reasons:
(a)
Wages paid above 110% of the median average
wage for a substantial majority of the jobs created;
(b)
Benefits packages which exceed industry
standards;
(c)
Establishment of a point of retail sales within Henderson
County;
(d)
Creation of jobs for persons in the Workfirst program;
and
(e)
Other pertinent consideration as determined by the Board.
10. The Board may also consider granting Incentives to existing industries
in order to retain jobs and/or the tax base. Incentives for job and/or
tax base retention will be based on funds available to the Board of
Commissioners for appropriation.
11. The Board may consider providing any Incentives authorized by
N.C.G.S. 158-7.1 including, but not limited to site preparation, water
and/or sewer infrastructure, facility construction or modification expenses,
land costs*, equipment purchase, and training expenses.
*Note: As stated above, these will typically be paid
on a reimbursement basis over a period of years. If land costs are provided
in whole or part as an Incentive, the Board may only provide an amount
equal to the total of the prospective annual taxes to be paid or generated
by the Enterprise over the next ten (10) years; a substantial number
of jobs paying at or above the median average wage must be created;
and the facility must actually complete the construction of improvements
on the land within five (5) years that will generate the annual tax
revenues as estimated, or such sooner period as required by the Board.
12. Any Enterprises receiving Incentives from Henderson County will
be required to enter into a binding contract to secure both the amount
of capital investment and the number of jobs to be created or retained,
hereinafter AIncentives Agreement@.
13. The Board of Commissioners will evaluate each request on a case-by-case
basis prior to making a decision whether to provide Incentives to any
Enterprise. The Board may consider factors such as, but not limited
to,
(1) the need for an incentive package as a determining
factor for the relocation or explanation of an enterprise in the county;
(2) the amount of new or expansion capital investment;
(3) the number and salary of jobs to be created;
(4) the type of product or service to be produced;
(5) the location of the proposed development;
(6) the project=s conformance with the Land Use Plan; (7) the project=s impact on the volunteer fire department, farming, schools, existing
utilities, adjoining property owners, the designation of open space
and transportation network; (8) the monies available in the Economic Development
Fund; (9) availability of public water and sewer; (10) whether the Enterprise is taking advantage
of other economic development incentives which may be available, including
but not limited to the use of industrial bonds; (11) whether the project will be annexed; and (12) other factors determined by the Board.
14. Nothing in these guidelines shall create any entitlement nor
guarantee of any Incentives to any Enterprise.
15. No offer from Henderson County for Incentives
will be binding on Henderson County until:
(1)
the Incentives have been duly approved
by the Board of Commissioners after a duly advertised public hearing;
and
(2)
an Incentives Agreement guaranteeing
the requisite job creation and taxable capital investment has been executed
by both the Enterprise and the County.
Any expenditure of funds by an Enterprise prior to the
occurrence of both the Commissioners= approval
and the contract execution will be solely at the risk of the Enterprise
seeking Incentives.
16. Preference will be given to Enterprises that purchase the land
and facilities within which they will locate. However, the Board will
consider Incentives for Enterprises which lease the land and facilities
under appropriate circumstances as determined by the Board on a case-by-case
basis.
17. Enterprises which are relocating or expanding within or near
a municipality, or are seeking to utilize the public services of a municipality,
must also seek economic development incentives from the municipality.
The amount of Incentives should be relative to the amount of new revenue
generated for the municipality by the relocation or expansions for both
the County and municipality.
18. The Board will have the discretion to raise or lower the thresholds
of these guidelines based upon economic conditions and/or unemployment
rates in Henderson County, or based upon additional benefits to be received
by the County due to infrastructure expansion by or on behalf of the
Enterprise.
19. These guidelines are subject to periodic review.
Adopted
on November 1, 1999.
THE HENDERSON COUNTY BOARD OF COMMISSIONERS
/s/ Grady Hawkins Grady Hawkins, Chairman
Attest: (County Seal)
/s/ Elizabeth W. Corn Elizabeth
W. Corn Clerk
to the Board
ANNUAL INCENTIVE FORMULA
Annual Incentive =
Taxable Capital Investment Multiplied By
(0.4%+ Employment Factor)
The
Board of Commissioners will have the discretion to determine the number
of years for which an annual incentive will be granted.* The number
of years for which annual Incentives are granted will determine the
term of the required Incentives agreement entered between the County
and the Enterprise.
*Note:
Annual Incentives are the minimum Incentives which will be considered
by the Board. Bonus Incentives may be granted as provided in the guidelines.
Annual Incentives will typically be granted for a 3-5 year period and
will typically be structured as partial reimbursements for activities
as authorized by N.C.G.S. 158-7.1 In no event will the sum of the partial
reimbursements exceed the total cost of the activity(ies) for which
reimbursement is being made.
Examples:
ABC
Inc., a widget manufacturer, is
considering locating a facility in Henderson County, and is also considering
a location in the State of Georgia.
ABC Inc. will make a capital investment of $15.0 Million, and
will create 60 new jobs paying $12.00/hour with full benefits.
Site grading expenses for the 15 acre site which they have their
eye on in Henderson County will total to approximately $300,000. ABC has inquired as to what incentives Henderson
County would be willing to offer them to locate in Henderson County.
Analysis: According to the formula, ABC, Inc. could
qualify for consideration of incentives by the County in an annual amount
of $63,000, as partial reimbursement for their site grading expenses. This was calculated as follows:
Employment Factor =
.02% Annual Incentive
= $15.0 Million (.4% + .02%) = $15.0 Million (.42%) = $63,000.
The
Board would have the latitude to determine how many years an annual
incentive would be paid as a reimbursement for site grading expenses. The Board may decide to grant three (3) years
worth of incentives as a reimbursement, which would total to $189,000.
The maximum number of years would typically be 5 years, with
only $48,000 being payable in the fifth year.
(Remember, the reimbursement cannot exceed actual expenditures
for site grading.)
Example:
Assume ABC, Inc., will create 155 new employment positions.
Employment Factor = .1% Annual Incentive
= $15.0 Million (.4% + .1%) = $15.0 Million (.5%) = $75,000
Example: Assume ABC, Inc.=s, capital investment is $45.0
Million, and 60 new jobs will be created.
Employment Factor = .02% Annual Incentive = $45.0 Million (.4% + .02%) = $45.0 Million
(.42%) = $189,000
Example: Assume ABC, Inc.=s, capital investment is $45.0
Million and 155 new jobs will be created.
Employment Factor = .1% Annual Incentive = $45.0 Million ( .4% + .1%) = $45.0 Million
(.5%) = $225,000
In
this instance, the Board would determine the number of years that annual
incentives would be paid as a reimbursement for site grading expenses. |