Town drafts policy for incentivizing business

Ber thoud may soon have a written policy for businesses seeking incentives to invest in the town, with grants, tax- and fee-based programs and other options on the table.

Trustees asked town staffers to draft the policy during the board’s annual retreat in May. Many of

Ber thoud’s neighbors — including Loveland, Longmont and Greeley — have policies that dictate how and when the communities will consider giving an incentive to a potential investor.

On Tuesday, the town’s economic development director, Walt Elish, presented the product of nearly half a year’s work to the board.

The two parts of the policy target primary job creators as well as commercial and retail businesses. Elish said incentives would be available to businesses considering moving to

Ber thoud as well as local businesses wanting to construct new buildings or reuse a vacant building, so long as their application meets the other requirements.

Town Administrator Chris Kirk spoke about the need for a clear policy, which he said would mitigate uncertainty for businesses looking to invest in the town.

“Obviously the continued and sustained growth of our economy locally is important ,” he said .“And in the context of COVID and the economic uncertainty that we all face, continuing to grow our employment base and our retail, sales tax-producing sector is a good thing, generally speaking.”

“We often get requests for incentives. They’re provided by a lot of communities,” he added. “But in every case, when we get that request, our response is we don’t have a clear incentive policy at this point.”

The draft policy requires that recipients provide information to complete an economic analysis ensuring the proposal would lead to an increase in net revenue for the town.

For primary employers, requirements also include that the project must involve a capital investment of at least $500,000, create primary jobs with a facility wide aggregate payroll at least equal to the county average for all new hires and pay 80% of the facilitywide aggregate of health insurance premiums.

Projects by commercial and retail businesses seeking an incentive would be required to fill an identified retail gap or create are development or in fill opportunity along the Mountain Avenue corridor and involve a minimum investment of $100,000 in buildings or equipment during the first year.

Once approved, primary employers would have to continue to submit information to the town at least twice a year for as long as the incentive remained in force.

They would be required to meet the agreed-on investment and employment goals within three to 10 years or risk losing (or being forced to repay) the deal.

Commercial and retail businesses would also have to provide information twice a year and make a deal with the city including benchmarks and the possibility of repayment if goals aren’t met.

Incentives for primar y employers could include waiving, deferring or reimbursing development fees or sales and use tax; rebating for up to 10 years as much as 50% of property taxes collected on personal property put into service during the first year of operations; reimbursing a developer for the cost of public infrastructure improvements; and expediting review processes.

Commercial and retail businesses could also ask for taxes and fees to be waived, deferred or reimbursed; and may request a sales tax rebate lasting no more than five years or not exceeding 5% of the overall budget for a redevelopment project.

Those businesses could additionally ask for reimbursement on public infrastructure improvements, and projects on Mountain Avenue would be able to request facade grants of up to $10,000, totaling no more than 25% of the cost of the proposed improvement.

Elish noted that the town would not of fer an incentive to woo a business away from another Northern Colorado community, unless locations outside of the region were also being considered for a given project.

“That’s not growing the Northern Colorado economic pie, and it’s really pitting one community against another,” he said.

Board members questioned Elish, Kirk and town attorney Erin Smith about the input that the board would have on controlling what businesses could move into the town, with trustee Tim Hardy saying citizens were concerned that a lack of oversight could lead to a “free-forall.”

While Kirk said they would run into problems if they tried to limit particular brands or companies above a certain size from moving to Ber thoud, he also suggested that an incentive deal would give the town more leverage in controlling site plans and architecture.

“I think providing an incentive also gives us a little more influence in what that business looks like,” he said.

“If we star t picking and choosing, that kind of is a rabbit hole,” trustee May Soricelli said. “This is a tool for us to attract the businesses that we want.”

Trustees Jeff Hindman and Maureen Dower also questioned whether the minimum $100,000 capital investment wasn’t too steep for small businesses seeking an incentive.

“Looking at our downtown, if we want to incentivize more small businesses, I guess I would like to know what small businesses typically can afford to put $100,000 just into infrastructure,” Dower said.

The board could vote on a revised policy as soon as its next meeting on Nov.

10, Kirk said.