[HISTORY: Adopted by the Mayor and Council of the City of
Española 10-7-2003 by Ord. No. 2003-12; amended in its entirety 11-22-2010 by Ord. No. 2010-12. Subsequent amendments noted where
applicable.]
This chapter may be cited as the "Economic Development Plan
Ordinance."
The Economic Development Plan Ordinance is enacted pursuant
to the statutory authority conferred upon municipalities to allow
public support of economic development (NMSA 1978 §§ 5-10-1
through 5-10-13). This chapter is adopted as part of the City's
Economic Development Plan.
The purpose of the Economic Development Plan/Ordinance is to
allow public support of economic projects to foster, promote and enhance
local economic development efforts while continuing to protect against
the unauthorized use of public money and other public resources. Further,
the purpose of this chapter is to allow the City to enter into one
or more joint powers agreements with other local governments to plan
and support regional economic development projects.
A.
Local governments are allowed to provide direct or indirect assistance
to qualifying businesses for furthering or implementing economic development
plans and projects; furthermore, local and regional governments have
the authority to contribute assets to development projects. However,
the imposition of a tax must be approved by the voters in referendum.
B.
Eligible uses. Municipalities may impose municipal infrastructure
gross receipts taxes and dedicate the revenue for economic development
projects. A total tax of 0.25% (in four increments of 0.0625%) may
be imposed.
As used in this chapter, the following terms shall have the
meanings indicated:
A facility that is owned by the state, a county, a municipality
or a qualifying entity that serves the public through preserving,
educating and promoting the arts and culture of a particular locale,
including theaters, museums, libraries, galleries, cultural compounds,
educational organizations, performing arts venues and organizations,
fine arts organizations, studios and media laboratories and live-work
housing facilities.
A business support facility (City-owned) with processes that
accelerate the successful development of start-up and fledgling companies
by providing entrepreneurs with an array of targeted resources and
services. These services are usually developed or orchestrated by
incubator management and offered both in the business incubator and
through network contacts. A business incubator's main goal is
to produce successful firms that will leave the program financially
viable and freestanding. These incubator graduates have the potential
to create jobs, revitalize neighborhoods, commercialize new technologies,
and strengthen local and national economies.
A group of business organizations that are located close
together.
The provision of direct or indirect land, buildings or other
infrastructure; public works improvements essential to the location
or assistance to a qualifying business and includes the purchase,
lease, grant, or construction, reconstruction, improvement or other
acquisition or conveyance or expansion of a qualifying business; and
payments for professional services contracts necessary for local or
regional governments to implement a plan or project; the provision
of direct loans or grants for land, buildings or infrastructure; technical
assistance to cultural facilities; loan guarantees securing the cost
of land, buildings or infrastructure in an amount not to exceed the
revenue that may be derived from the municipal infrastructure gross
receipts tax or the county infrastructure gross receipts tax; grants
for public works infrastructure improvements essential to the location
or expansion of a qualifying entity; grants or subsidies to a cultural
facility; purchase of land or buildings for a publicly owned cultural
facility or business incubator.
The City of Española City Council.
A nontangible asset such as computer software or any other
exercise or application of the intellect.
An agreement between a qualifying entity and the City whereby
the City provides assistance to an economic development project in
exchange for the benefits received as set forth in this chapter.
A protective stipulation, as in a contract, or a precautionary
measure to guard public assets.
An existing or proposed corporation, limited-liability company,
partnership, joint venture, syndicate, association or other person
that is one or a combination of two or more of the following:
An industry for manufacturing, processing, or assembling any
agricultural or manufactured products.
A commercial enterprise for storing, warehousing, distributing, or selling products of agriculture, mining or industry, but other than provided in Subsection D of this definition, not including any enterprise for the sale of goods or commodities at retail or for the distribution to the public of electricity, gas, water, or telephone or other services commonly classified as public utilities.
A business in which all or part of the activities of the business involves the supplying of services to the general public or to government agencies or to a specific industry or customer, but, other than provided in Subsection D of this definition, not including businesses primarily engaged in the sale of goods or commodities at retail.
A telecommunications sales enterprise that makes the majority
of its sales to persons outside of New Mexico.
A.
The City Manager, after approval of the governing body, may assist
economic development projects in any legally permissible manner, including
but not limited to provision of land, buildings and infrastructure,
provided that all the requirements of this chapter are met. The City
may provide land, buildings or infrastructure it already owns, or
it may build, purchase or lease the facilities needed for an economic
development project. The City, at its discretion, may bear the full
cost or contribute a portion of the costs, including the waiver of
applicable fees. The City, at its discretion, may also contribute
to the payment of costs for professional service contracts such as
industry feasibility studies and planning and design services needed
to implement a project.
B.
The governing body may consider offering all forms of assistance
allowed under this chapter and any other legally permissible forms
of assistance; however, this does not establish any obligation on
the City's part to offer any specific type or level of assistance.
A.
Any qualifying entity meeting the definition set forth in § 29-5 may propose an economic development project to the City. Meeting the definition of a "qualifying entity" does not create any obligation on the part of the City of Española.
B.
Applications from qualifying entities shall be submitted to the City
of Española on forms provided by the City.
A.
Applications for economic development projects requesting economic
assistance from the City which meet the policies and objectives of
the City's Economic Development Plan shall receive priority.
Examples include, but are not limited to:
(1)
Manufacturing firms (including intellectual property such as computer
software);
(2)
Projects, which enhance the exporting capacity of companies and/or
provide goods and services which currently have to be imported into
Española;
(3)
Private companies seeking to build, expand or relocate facilities;
(4)
Private companies which provide facilities or services which enhance
the ability of Española businesses to operate;
(5)
Organizations, which assist business start-ups or bring small companies
together to increase their competitive abilities. This must involve
a tangible project which will create jobs and promote an industry.
Examples include, but are not limited to:
(a)
Business incubators;
(b)
Art incubators or coalitions (e.g., a performing arts coalition
seeking construction of rehearsal or performance facilities);
(c)
Public markets for farmers, gardeners, crafts, etc.; and
(d)
Organizations which foster economic development by promoting
work force development efforts such as apprenticeships or other job
training programs;
(6)
Projects in industry clusters listed above are particularly encouraged,
but others are eligible to apply as well. The intention is to retain
flexibility in the use of incentives; and
(7)
Qualifying entities with existing contract or projects with the City
when this plan is adopted may propose a restructuring of their projects
as an economic development project.
B.
All applications for economic development projects requesting economic
assistance from the City shall submit a cost-benefit analysis. Preparing
a cost-benefit analysis shall be the responsibility of the applicant.
The City retains the right to specify a format and methodology for
the cost-benefit analysis. The City trustees shall review and approve
the methodology used. The source and rationale for any multiplier
effects shall be identified. The cost-benefit analysis shall show
that the City will recoup the value of its donation within a period
of 10 years. The analysis shall address the following:
(1)
The number and type of jobs to be created, both temporary construction
jobs and permanent jobs (by New Mexico Department of Labor job category);
(2)
Pay scale of jobs;
(3)
Determination of which jobs are expected to be filled locally and
which will be filled by transfers from other facilities or recruited
from outside the Española Valley area;
(4)
Total payroll expected at start-up and after one year;
(5)
Anticipated impact on local tax base; and
(6)
Anticipated impact on local school systems.
C.
All applicants for economic development projects requesting economic
assistance from the City shall require the same review required of
industrial revenue bond applications. This review shall focus on environmental
and community impacts of proposed projects. Special attention shall
be given to job training and career advancement programs and policies.
Projects shall demonstrate a strong commitment to providing career
opportunities for Española Valley area residents. Cultural
impacts of projects shall also be considered.
D.
Any qualifying entity seeking assistance shall prepare and make available
a job training and career development plan for its employees.
E.
All applicants for economic development projects requesting economic
assistance from the City shall clearly demonstrate the benefits which
will accrue to the community as a result of the donation of public
resources. The City has considerable flexibility in determining what
is considered "adequate benefits." Benefits, such as providing components
or production capabilities, which enhance a targeted industry cluster,
or addressing critical deficiencies in the regional economy, may be
recognized. The benefits claimed of any proposal will receive careful
scrutiny. However, it is the intent of this chapter to be flexible
in the evaluation of these benefits, and to recognize the qualitative
as well as quantitative impact of a proposal.
F.
All applicants for economic development projects requesting assistance
from the City shall clearly demonstrate how the qualifying entity
is making a substantive contribution. The contribution shall be of
value and may be paid in money, in-kind services, jobs, expanded tax
base, property or other thing or service of value for the expansion
or improvement of the economy. The City retains flexibility in defining
the "substantive contributions." The benefits identified in the previous
subsections may be accepted as adequate contributions on their own,
or cash donations may be required. Assistance in providing affordable
housing to its employees or the community at large may also qualify.
Determination of what constitutes an acceptable contribution for a
given project shall be at the discretion of the governing body.
A.
All economic development projects receiving assistance from the City
shall be subject to an annual performance review conducted by the
City of Española. This review shall evaluate whether the project
is attaining the goals and objectives set forth in the project participation
agreement. This review shall be presented to the governing body for
its consideration. The governing body, at a public hearing, may terminate
assistance to the economic development project by provisions set forth
in the agreement which terminate the agreement and specify the disposition
of all assets and obligations of the project.
B.
The City shall retain a security interest, which shall be specific
in the project participation agreement. The type of security given
shall depend upon the nature of the economic development project and
assistance provided by the City. Types of security may include, but
are not limited to:
(1)
Letter of credit in the City's name;
(2)
Performance bond equal to the City's contribution;
(3)
A mortgage or lien on the property or equipment;
(4)
Pro-rated reimbursement of donation if company reduces work force
or leaves the community before the term agreed to; and
(5)
Other security agreeable to both parties.
C.
Should a qualifying entity move, sell, lease or transfer a majority
interest in the economic development project before the expiration
of the project participation agreement, the City retains the right
to deny any and all assignments, sales, leases or transfers of any
interests in the economic development project until adequate assurances
are made that the transferee, assignee or lessee is a qualifying entity
and that the terms of the agreement will be satisfied by the transferee,
assignee or lessee. At its discretion, the City may choose to deny
said assignment, lease or transfer or may negotiate a new agreement
with the new operator, or the City may reclaim the facility and enter
into an agreement with the new qualifying entity.
D.
Any qualifying entity seeking assistance from public resources shall
commit to operate in accordance with its project participation agreement
for a minimum of 10 years from the date the ordinance is adopted and
the project participation agreement is passed by the governing body.
A.
The qualifying
entity shall prepare with the City a project participation agreement.
This agreement is the formal document which states the contribution
and obligation of all parties in the economic development project.
B.
The agreement must state the following items:
(1)
The economic development goals of the project;
(2)
The contribution of the City and the qualifying entity;
(3)
The specific measurable objectives upon which the performance review
will be read;
(4)
A schedule for project development and goal attainment;
(5)
The security being offered for the City's investment;
(6)
The procedures by which a project may be terminated and the City's
investment recovered; and
(7)
The time period for which the City shall retain an interest in the
project. Each project agreement shall have a "sunset" clause after
which the City shall relinquish interest in and oversight of the project.
C.
Each project participation agreement shall be subject to review and
approval by the governing body at a public hearing.
All project monies shall be kept in a separate account by the
entity and the City, with such account clearly identified. These accounts
shall be subject to an annual independent audit.
The governing body may terminate this chapter and the City's
economic development plan and any or all project participation agreements
undertaken under its authority. Termination shall be by ordinance
at a public hearing or in accordance with the terms of the project
participation agreement. If an ordinance or a project participation
agreement is terminated, all contract provisions of the project participation
agreement regarding termination shall be satisfied. Upon termination
of the ordinance or any project participation agreement, any City
monies remaining in the City project accounts shall be transferred
to the City's general fund.
The City may engage in economic development projects involving
one or more other government entities for projects which encompass
more than one municipality, county or pueblo (Native American) government.
In such instances, the relevant governing bodies shall adopt a joint
powers agreement. This agreement will establish the application criteria
and the terms of all project participation agreements. Criteria established
under a joint powers agreement shall be consistent with the provisions
of this chapter.
