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HomeMy WebLinkAboutIPD_GuidelinesG:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc City of Palm Desert/Economic Development Department Invest Palm Desert Guidelines 73-510 Fred Waring Drive • Palm Desert • California • 92260 • (760) 346-0611 Invest Palm Desert was established to enhance the City of Palm Desert’s ability to promote economic development, facilitate the growth of its businesses that provide high quality jobs, a strong economic base to support services to its residents, aid in the diversification of the City’s economy, and promote an improved quality of life within the City. Questions regarding this program should be directed to 760-776-6441. A. Minimum Eligibility Criteria In order to be eligible for the Incentive Program, an applicant must meet the following criteria: 1. Be a business, business owner, lessor, developer, or real property owner within the boundaries of the City of Palm Desert, and in good standing with the City of Palm Desert. Improvements must be of architectural significance or must add a minimum of 20% of the current square footage of an existing location, or 1,000 square feet. 2. The business, project or development must be located or provide evidence that it will locate within the Desert Willow Golf Resort, University Park areas or the following zoning districts within the boundaries of the City of Palm Desert; Downtown (“O”), Downtown Overlay (“DO”), Downtown Edge (“DE”), Planned Commercial (“PC”) or Service Industrial (“SI”). 3. Demonstrate financial need and offer a clear state of public purpose for participation and consideration to the City in the Incentive Program, including documentation demonstrating a feasibility gap analysis, project shortfalls or other evidence stating the public purpose for participation in the Incentive Program. The applicant must acknowledge that participation in the program will trigger prevailing wage. 4. Satisfy at least one of two of the following criteria (in addition to program category criteria in part B below): a. 1 new permanent full-time job with salaries equal to or greater than 100% of the most recently published Area Median Income (AMI) for a 1-person household in Riverside County, as reported by the California Department of Housing and Community Development (HCD) per $100,000 of incentives; or b. 2 new permanent full-time jobs with salaries equal to or greater than 90% of the most recently published AMI for 1-person household in Riverside County as reported by HCD per $100,000 of incentives. 5. Applicants must receive their entitlements and associated permits after the date of adoption of this Resolution by the City Council (July 14, 2022) 6. Applicants must receive their entitlements and associated permits within 6-months of funding approval from the City. In the event an applicant is approved for an incentive and does not commence improvements prior to that time, the applicant forfeits the entirety of the awarded incentives. Invest Palm Desert Program Guidelines 2 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc B. Types of Incentives Offered – by Category (subject to “Requirements and Limitations” in Section E.) 1. Development & Plan Check Fee Rebate: Applicants may request a rebate of certain City-administered development fees in an amount not to exceed 100% of the total City development fees typically required of the applicant and depending on the character of the project. The amount of the applicant’s fees to be rebated will be calculated and rebated to the applicant upon completion of the project. Fees that may be rebated are: a. Initial or Expedited Plan Check Fees b. Planning Fees c. Certain Development Fees 2. Capital Improvements Grant: Applicants may apply for a matching grant of 1:1 from the City up to a dollar amount that totals 50% of the requested hard costs of permanent capital improvements or rehabilitation. Permanent capital improvements can include elements such as façade enhancements, interior capital improvements, or other hard costs associated with rehabilitation, renovation, or redevelopment of a commercial or industrial building or structure. The improvements must be constructed within the zoning districts defined in Section A, herein. Approval of participation and terms of the Capital Improvements Grant program is at the sole and case-by- case discretion of the City Council. a. The San Pablo Capital Improvements Grant: For properties located along the San Pablo commercial corridor improvements (within zoning districts Downtown (“D”), Downtown Edge (“DE”) and Downtown Overlay (“DO”) Hwy 111 and Fred Waring Drive, and with a portion of site frontage along San Pablo Avenue and located within attached map, Exhibit B), a matching grant of 2:1 up to a dollar amount that totals up to 66% requested hard costs of permanent capital improvements or rehabilitation will be considered. b. A lien will be placed upon the real property associated with the project. In addition to the other requirements listed herein, the applicant must continue to own and operate the project for a minimum of two years from the date of Certificate of Occupancy. In the event the applicant does not perform in accordance with the stated terms of the Incentive Agreement, the property owner will be required to refund the City an amount prorated to the number of days deficient of the Incentive Program requirements. c. In no case shall the City’s contribution exceed $500,000 to an individual project within the Capital Improvements Grant, and in no case shall the City’s Contribution exceed $200,000 within the San Pablo Capital Improvements Grant. 3. High Wage “Move-In” Incentive: The City may consider on a case-by-case basis providing assistance to a business that relocates its headquarters operations into Palm Desert from outside the City or to entities from the Palm Desert iHub that locate their HQ operations in the City. The City may provide assistance: a. In the form of moving assistance of $25,000 per employee (in no case shall the total amount of incentive exceed $500,000). The tech business must relocate its headquarters operation in its entirety and remain in operation as a headquarters in its entirety for a minimum of two years. The business will retain its count of employees for a minimum of two years. Payments will be paid in arrears after providing documentation of the following: i. Jobs must pay 150% of average wage in Palm Desert as of January 1, 2020 ($48,880 x 150% = $73,200). Applicant is required to provide evidence of such salary(ies) in the form of an Invest Palm Desert Program Guidelines 3 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc anonymized salary roll certified by a third-party accountant and delivered for review to the City Finance Director. Applicants for tech innovation incentives must provide evidence of business operations matching NAICS code(s) in the list in Exhibit C herein. Applicants that operate a business with a NAICS code not listed must provide a statement of purpose which clearly identifies the business as tech based. Approval of participation and terms of the tech innovation incentive is at the sole and case-by-base discretion of the City Council. 4. Site-Specific Revenue Sharing: Applicants may apply for a partial rebate of new incremental revenue generated by the Applicants business at a specified development site. Rebates will be conditioned on the City’s receipt of the new incremental tax revenue and will be calculated based on the actual revenues for the Applicant’s business received by the City. Approval of participation and terms of the Site-Specific Revenue Sharing program is at the sole and case-by-case discretion of the City Council. 5. New Development Project Assistance The City may consider, on a case-by-case basis, providing assistance with new development projects that include, but are not limited to, land purchase assistance, gap financing, and other public infrastructure investments that create, support, or enhance the public uses of the project. Approval of participation and terms of the New Development Project Assistance program is at the sole discretion of the City Council. 6. Ongoing & Other Incentives: The City may provide additions and subtractions to the Incentive Program from time-to-time, the terms of which will be provided at the time of approval. C. Review and Approval Process: 1. Any existing Palm Desert business, real property or building owner, lessor (with owner approval) meeting the minimum eligibility qualifications identified in Section A may submit an Incentive Application along with a written proposal to the Economic Development Director. The proposal shall: a. Highlight the public purpose and consideration to the City (i.e., jobs, elimination of hazardous condition, etc.) and clearly identify the project finance gap, if present. b. Provide a general description of the proposed project, type of business, location, number, and type of jobs existing and to be added, projected tax revenue generation (see Section B for qualifying revenue sources), and any other criteria the City may use to evaluate the public benefit of the proposed project. This may include both financial benefits as well as enhancements to the community's overall quality of life and diversification of the City's economic base. c. Financial summary of the project including, total cost of project, including separate identification of hard costs and soft costs and any other costs associated. d. A preliminary financial plan, whether the project is funded by equity, or debt, or a combination of both. e. Address of the required qualifications of Section A that are being proposed. f. Identify the incentives requested and the estimated value of each requested. 2. Upon receipt of the proposal, the City Manager will review the request and forward a copy of the application to the Economic Development Director for review. The Economic Development Department Invest Palm Desert Program Guidelines 4 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc will complete a fiscal analysis and review the application and proposal along with the requested incentives. 3. Based upon the fiscal analysis and review of project by the Director of Finance, City Attorney and various other City staff, negotiation with the applicant, and consideration of the overall public benefit of the proposal and proposed incentives the Economic Development Director shall prepare a proposed incentive package qualification report for City Manager or City Council consideration and approval. D. Value of Incentives and Approval Process: 1. The total value of the incentives offered to the applicant will depend on the particular attributes of each proposal, and shall be determined on a case-by-case basis, with importance placed on the public economic benefits that will accrue to the City by expansion of the existing business or employees. The City retains the right in its sole discretion to reject any proposal. 2. After review of the application by the City's Economic Development Department shall perform an analysis of the applicant's requested incentives. Applicants are encouraged to provide economic impact studies or analysis for the City's consideration. The City may undertake those studies or analyses at the City's or, with consent of the applicant, applicant's cost (to be deducted from the amount received by the applicant and/or reimbursed to the applicant from the City). 3. After review by the Economic Development Director, recommendations will be provided to the City Manager or City Council for further qualification consistent with the Incentive Program and any applicable laws. If the applicant meets the criteria established by Section A of Incentive Program and sufficient information is gathered to justify the City's provision of an incentive package, the Economic Development Director shall cause to be prepared an Incentives Funding Agreement that shall be signed by the City Manager, or Mayor, as applicable. 4. Applications requesting less than $25,000 may be approved by the City Manager. However, the City Manager may require City Council approval of any applications, including those less than $25,000. Any incentive listed as case-by-case or combination of incentives requested that include those listed as case- by-case will require review and approval by the City Council. City Manager approvals will not exceed $250,000 in aggregate for any given year of the Program (however, no one applicant will be approved for more than $25,000 without the City Council's approval). 5. Any incentive valued at $100,000 or more must be approved consistent with the requirements of Government Code 53083 (effective January 1, 2014). In no case shall the City provide incentive in violation of 53084 and 53084.5. 6. The applicant must receive all other project entitlements and permits as required. E. Requirements and Limitations: 1. Incentives are offered on a case-by-case basis and at the sole discretion of the City Council. 2. Incentives will be offered and based upon the availability of City funds as appropriate by Council on a year-to-year basis. Applications that qualify when funds are no longer available may be placed on a waitlist for future fund availability but are not guaranteed funding. 3. Applicants must commence the project as described within 6 months of City funding approval. In the event an applicant receives entitlements after the date of adoption and does not commence the project within 6 months the applicant is no longer eligible for the incentives and agrees to forfeit any and all incentives awarded. Invest Palm Desert Program Guidelines 5 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc 4. The incentives herein may not be applied retroactively except for when allowed as described herein. Applicants should not secure City permits prior to receiving approval of their funding request. 5. Incentives and/or incentive packages may trigger a requirement to pay prevailing wages. Applicants are required to abide by prevailing wage laws, which apply to construction projects funded in whole or in part with public funds, by State law. Applicants will be required to agree to indemnify, defend and hold the City harmless for any claim that prevailing wage was applicable and not adhered to. Applicants should seek professional advice regarding prevailing wage requirements. 6. City reserves the right to reject any or all proposals. 7. Applicants are highly encouraged to seek legal representation to pursue an incentive under this Program. F. Required Agreement Provisions: 1. To receive an incentive under the Incentive Program, Applicants will be required to enter into an agreement with the City. 2. Agreements prepared in furtherance of the selected Incentive Program may include the following provisions and others in the discretion of the City: a. Terms and Conditions of the incentive package, including timelines for payment dues, reimbursements, etc., may be applicable to the incentive package. b. Annual Monitoring: Sufficient monitoring of the applicant’s continued eligibility of the incentives offered under the Incentive Program. For example, applicants receiving incentives for the creation of additional jobs, paycheck stubs or other proof that individuals continue to be employed will be required for a length of time deemed appropriate for the parties. Data provided can support reporting under Government Code 53083 requirements, however, a separate and annual report must be filed with the City and the responsibility of such report lies solely with the applicant. Failure to report can result in forfeit of incentives. Applicants seeking Capital Improvements agree to regular inspections by City staff and will require review upon completion that the design agreed upon was constructed. c. Records Open to Inspection: The City will have a right to inspect, upon a minimum of 48 hour advance notice, financial records maintained by the applicant pertaining to incentives under the Incentive Program. d. Indemnification: Applicant shall indemnify the City for claims related to the implementation of the agreement. e. Security for any loans, grants or deferrals or other incentives. f. Contractually agree to continue operation for the duration of the incentive(s) or be required to return the value of the incentive(s) provided or per terms of the mutually negotiated Incentives Agreement. g. Applicant shall comply with all local and state regulatory requirements, e.g. California Environmental Quality Act, local zoning requirements, etc. 3. Any other agreements required by the incentive package shall be approved by the City Council and shall be prepared based on the agreement negotiated by the parties, including but not limited to, deferral and loan agreements, the Incentive Agreement. Invest Palm Desert Program Guidelines 6 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc G. General Provisions: 1. No additional incentives will be offered unless a Resolution expanding the Incentive Program is adopted by the City Council. 2. This Program will provide funds as long as they are available and subject to appropriation by the City Council year-to-year, and as applications are deemed eligible by the City. In no case is the City obligated to provide funding to applications it does not deem in the public benefit, nor for any application that exceeds the fund balance. The City, in its sole opinion, reserves the right to reject any application for any reason. 3. The Incentive Program may be modified by the City Council at any time. Invest Palm Desert Program Guidelines 7 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc EXHIBIT B Map of San Pablo Capital Improvements Grant Area Invest Palm Desert Program Guidelines 8 | P a g e G:\Econ Development\Invest Palm Desert\2022 Guidelines and Application\2022 Guidelines.doc EXHIBIT C NAICS Code – for Qualification in Tech Innovation Grant Program The following list contains those NAICS codes which most directly involved in the "High Tech" sector. It is not exhaustive of all possible high-tech industries. NAICSN NAICS_LAB 333295 Semiconductor machinery mfg 333315 Photographic and photocopying equipment manufacturing 334111 Electronic computer mfg 334112 Computer storage device mfg 334113 Computer terminal mfg 334119 Other computer peripheral equipment mfg 334210 Telephone apparatus manufacturing 334220 Broadcast and wireless communications equipment 334413 Semiconductor and related device manufacturing 334511 Search, detection, navigation, guidance, aeronautical, and nautical system and instrument manufacturing 421430 Computer & peripheral equip & software whsle 421690 Other electronic parts & equipment whsle 423430 Computer and computer peripheral equipment and software merchant wholesalers 423690 Other electronic parts and equipment merchant wholesalers 443120 Computer and software stores 511140 Database and directory publishers 511210 Software publishers 514210 Data processing services 518210 Data processing, hosting, and related services 519130 Internet publishing and broadcasting and web search portals 541330 Engineering services 541511 Custom computer programming services 541512 Computer systems design services 541513 Computer facilities management services 541519 Other computer related services 541710 R&D in physical, engineering & life sciences 541711 Research and development in biotechnology 541712 Research and development in the physical, engineering, and life sciences (except biotechnology)