This Economic Development Incentive Policy is being considered to promote the location of new businesses within Prowers County and the Cities of Lamar, Holly, Granada, and Wiley, as well as to encourage the expansion of existing businesses within the County and its municipalities. Such activities will stimulate the local economy by providing new employment opportunities, improved infrastructure, and an expanded tax base. This policy would not commit the County or its municipalities to providing economic incentives in every instance, nor would it restrict them from providing additional incentives in a specific instance.

The level of incentives offered will be based upon a number of factors indicative of economic growth, such as:

* Number of jobs created

* Level of pay for jobs created/general quality of jobs

* Infrastructure investment

* Other factors which will stimulate the local economy and expand the local tax base and to improve the overall well being of the County and its municipalities.

The following formulas would be modified to reflect the criteria listed above. Thus the following table should only be considered a starting point. Figures represent the percentage of normal taxes waived in years 1-4.

The same principles apply to this table as do to the one above.

The City of Lamar will consider, on a case by case basis, providing the following services without charge:

* Utility infrastructure improvements such as extension of utility lines, street or road improvements.

* Waiver of building permits and plan document review fees.

* Discounted prices for the purchase or lease price of land or buildings owned by the city.

Industrial Revenue Bonds (IRB's) are financing instruments issued by designated local industrial development organizations or other issuers authorized by state law. Usually financial institutions and other intermediaries participate by providing letters of credit backing the bonds. Thus, the company seeking the bonds must be considered credit worthy by the financial institution.

IRB's provide financing for land, building and equipment for new and expanding manufacturing plants. Certain expenses such as architectural, engineering, legal and administrative fees associated with the sale of the bonds can be paid from the bond proceeds (subject to the limitations of Internal Revenue Service regulations).

The political subdivision issuing the IRB retains ownership of the bond-financed facility and leases it back to the company at a rate sufficient to pay the principle and interest on the bonds as they mature. When the user leases the property back, there may be several tax advantages such as exemption from sales tax on construction materials, use tax on the purchase of equipment, as well as mortgage deed tax and ad valorem taxes which are levied for school purposes are not eligible for exemption.

This proposed incentive would help finance the front-end costs of development by allowing the incremental increase in tax revenues from new development to pay for the public investments needed to realize the development.

Specifically, Tax Increment Financing is used to publicly finance needed public improvements and enhanced infrastructure in a defined area. The intended purpose is to promote the viability of existing businesses and attract new commercial enterprises. The cost of improvements to the area is repaid by the contributions of future tax revenues by each participating taxing unit that levies taxes against the property. Each taxing unit can choose to dedicate all, a portion of, or none of the tax revenue that is attributable to the increase in property values due to the improvements within the reinvestment zone. The additional tax revenue that is received from the affected properties is referred to as the tax increment. Each taxing unit determines what percentage of its tax increment, if any, it will commit to repayment of the cost of financing the public improvements.

Prowers County is considered part of an enhanced Enterprise Zone. As a result, qualified applicants are eligible for 200% of the amount given in areas not in an enhanced zone.

Information regarding the Colorado Enterprise Zone is available from the Colorado Department of Revenue web site and include the following:

* Investment tax credits

* New business facility job credits

* State Sales and Use tax exemption for manufacturing equipment

* Research and Development Tax Credits

* Tax credit for private contributions to Enterprise Zone Administrators

* Tax credit for the rehabilitation of vacant commercial buildings

* Qualified job training program investment credits

* Qualified school-to-career investment credit

The following are examples of other incentives that may be available through the Federal Government or the State of Colorado

* Low interest loans and grant funds through Federal Economic Development Administration

* Small Business Administration low interest loans and grant funds. These may be available if sUpported by a local bank.

* Low interest loans and grant funds through the United States Department of Agriculture, as part of the USDA Rural Development Program.

* Low interest business loans through the Revolving Loan Fund program, administered through the Colorado Office of Economic Development and International Trade.

* Colorado Department of Local Affairs grant funds

* Training Assistance through Lamar Community College

PCDI will assist with the preparation and submission of applications for grant funds for infrastructure improvements such as roads, relocation of utilities, and capacity expansion of existing utilities.

PCDI and SECED will coordinate any involvement of a Special Improvement District to finance and build infrastructure improvements with provision for repayment with future property taxes.