Nurturing Economic Health in Fort Collins
Businesses can locate anywhere they want. That’s the bottom line. So how do we create an environment where businesses want to stay and expand?
First, it’s about place. The City of Fort Collins is fortunate to have a stellar university in town, miles and miles of trails, excellent health care, and proximity to the Rocky Mountains and Denver International Airport. The community draws diverse industries and companies without significant economic incentives. Some are multi-million dollar international companies; some are sole proprietor local-only businesses. And everything in between.
Sometimes, the companies moving or expanding need a little help to get to that next level. Occasionally, the City is able to help qualifying projects stay in Fort Collins or even expand. How does the City decide which companies to help and with what tools? Read on.
How We Decide:
Decisions on financial assistance packages are not taken lightly. To be equitable to all parties, a formal request for assistance must be submitted by the company to the Economic Health Office and include the following information:
- Brief summary of the project, including description, purpose and timeline
- Location specifics (and other locations considered)
- Costs associated with relocation/expansion/move
- Jobs created and/or retained
Tools We Use
The City of Fort Collins uses a variety of local incentives to assist primary employers with relocation and expansion efforts. The City works collaboratively with each primary employer and builds a package that is specific to the individual needs. Here are highlights of some of the tools and a brief description:
- Private Activity Bond Financing – A Federal Program giving private corporations access to Tax Exempt financing. The financing can be used to acquire property, construct building, renovate an existing building, and procure equipment.
- Manufacturing Equipment Use Tax Rebate Program – Local manufactures can request a partial rebate of the 2.25 percent local use taxes paid on qualifying equipment. Use taxes are used by other Colorado municipalities and intended to equalize competition between venders located in the cities who collect local sales tax and those located outside the cities who do not charge local sales tax.
- Personal Property Tax Rebate – Requires approval of the City Council. Past agreements with primary employers have included a 10-year rebate for 50 percent of the personal property in the expansion/relocation project.
- Expedited Development Review – For large primary employment development projects, the City will commit to an expedited development review and building permit application process. This process can save essential time allowing for rapid construction minimizing the time to the expansion/relocation event.
- Tax Increment Financing (TIF) – For projects within an Urban Renewal TIF District, the Urban Renewal Authority can reimburse developers for eligible public improvements. Requires approval of the Urban Renewal Authority (URA) Board.
- Section 108 Loan Program – Low-interest loans are available for existing businesses that plan to expand or relocate within the City. Federal regulations for job creation apply and loans require approval by the City Council.
- Other Incentives – Examples include assistance with off-site improvements and deferral of additional fees (e.g., drainage fees). The use of these other incentives typically depends on the financial need of the specific project.
Why Should We Get Involved
Over the past seven years, the City’s practice of assisting companies has paid off. Our industry clusters have expanded, supply chain management in some industries has become more streamlined and our area is known nationally and internationally as a clean energy, water innovation, chip design and brewery centric location.
Having diverse industries helps our community weather the economic storms. It makes us more resilient. Studies have shown that the Great Recession hit Fort Collins later than most cities and we rebounded more quickly due to the success of these different industries.
When companies apply for assistance we take into account their contribution to this diversity and how the community would be impacted if they left or downsized. The decisions are evaluated for long-term impacts, not next month or even next year.
Many of the business assistance packages are performance based. Companies are required to make a certain level of investment, maintain a high-quality facility and hire new jobs. These elements produce ripple effects in the community and keep a mix of jobs that might otherwise be lost to another region or state.
Who Has Benefited
Many times, it is not just the company requesting assistance that benefits, but the community as a whole. An example of this was seen in the recent business assistance package approved by City Council.
Avago Investment: $165M
Maximum assistance from City, County and State: $5.9M
Projected Property Tax Collections 2013–2023
- $7.9M to Poudre School District
- $550K to Poudre River Public Library District
- $325K to Health District of Northern Larimer County
- $2.4M to Larimer County (net after rebate)
Leveraging the upfront investments by the company and agencies creates long term funding that would not otherwise be collected, and shared by the whole community.
The City Council will discuss this process at the January 22 Work Session. Feel free to contact the City’s Economic Health Director with questions, comments, suggestions or ideas: Josh Birks, (970) 221–6324, amJpcmtzQGZjZ292LmNvbQ==.