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HomeMy WebLinkAboutItem 06.fMay 16, 2014 Item No. Menasha Packaging Company Job Creation Fund Application May 19, 2014 Council Meeting Proposed Action Staff recommends adoption of the following motion: Move to approve the attached resolution of support for the Menasha Packaging Company Job Creation Fund application. Passage of this motion will result in the submittal of a Job Creation Fund application on behalf of Menasha Packaging Company to the Minnesota Department of Employment and Economic Development. Overview Menasha Packaging Company has completed an application to be submitted to the Minnesota Department of Employment and Economic Development (DEED) for the newly created Job Creation Fund Program. They are seeking a resolution of support from the City of Lakeville as a part of the application process. The Job Creation Fund Program provides financial incentives to new and expanding businesses that meet certain job creation and capital investment targets. Companies deemed eligible to participate may receive a benefit based on actual jobs created and for constructing or renovating facilities or making other property improvements. The program is available to businesses engaged in manufacturing, warehousing, distribution, technology -related industries, and other eligible activities. Companies must work with the local government (city, county or township) where a project is located to apply to DEED to receive designation as a Job Creation Fund business. Primary Issues to Consider • Will this application limit the ability of other Lakeville business expansions to qualify for the program? No, each application is evaluated on its own merits for the specific project being proposed. Supporting Information • Resolution of Support for Menasha Packaging Company's Job Creation Fund application • Job Creation Fund Program overview David L. Olson Community & Economic Development Director Cc: Paul Paprocki, Menasha Packaging Com Financial Impact: $ 0 Budgeted: Y/N Related Documents (CIP, ERP, etc.): Notes: Source: CITY OF LAKEVILLE DAKOTA COUNTY, MINNESOTA RESOLUTION NO. RESOLUTION REGARDING THE SUPPORT OF A JOB CREATION FUND APPLICATION IN CONNECTION WITH MENASHA PACKAGING COMPANY WHEREAS, the City of Lakeville, Minnesota (the "City"), desires to assist Menasha Packaging Company, LLC a limited liability company which is proposing to construct a facility in the City; and, WHEREAS, the City of Lakeville understands that Menasha Packaging Company, through and with the support of the City, intends to submit to the Minnesota Department of Employment and Economic Development an application for an award and/or rebate from the Job Creation Fund Program; and, WHEREAS, the City of Lakeville held a city council meeting on May 19, 2014, to consider this matter. NOW, THEREFORE, BE IT RESOLVED that, after due consideration, the Mayor and City Council of the City of Lakeville, Minnesota, hereby express their approval of the project proposed by Menasha Packaging Company and its application for an award and/or rebate from the Job Creation Fund Program. ADOPTED this 19th day of May, 2014, by the City Council of the City of Lakeville. CITY OF LAKEVILLE AM ATTEST: Charlene Friedges, City Clerk Matt Little, Mayor Minnesota Job Creation Fund Program Program Overview The Job Creation Fund (JCF) program is DEED's newest program to encourage job creation and capital investment in new or expanding businesses. The program provides job creation awards of up to $500,000 and capital investment rebates of up to $500,000 for qualifying businesses. Eligibility Businesses may apply through a local government where their new or expanding business will be located and must be primarily engaged in manufacturing, warehousing, distribution, IT, or other eligible activities. At minimum, a business must: • Invest $500,000 in real property improvements within one year of designation as a Job Creation Fund Business; and, • Create 10 new full-time, permanent jobs within two years of designation as a Job Creation Fund Business; and, • Obtain a resolution of support from the local government where the business will be located. Benefits A business approved and designated by DEED for the program may request benefits after entering into a business subsidy agreement with DEED, making an investment of at least $500,000 within one year, and having at least 10 new permanent full-time jobs in place for one year. Benefits include: • Up to 7.5% rebate on capital investment in real property improvements in Greater Minnesota • Up to 5% rebate on capital investment in real property improvements the Twin Cities Metro • Between $1,000-$3,000 per new permanent full-time job per year, based on cash wages paid • All new jobs must pay at least $12.48 in total compensation • All wage and compensation levels are adjusted annually Provisions for Large Projects Businesses making a capital investment of more than $25 million may be eligible for these JCF awards: • Up to $2 million ($1 million in capital investment rebates and $1 million in job creation awards) if the business creates at least 200 full-time permanent jobs. Up to $1 million in capital investment rebates for projects that will retain at least 75 full-time permanent jobs in Greater Minnesota or 200 in the Twin Cities metro area. Although equipment may be counted toward large project eligibility, the capital investment rebate only applies to the expenditures related to real estate — land and building — improvements. For More Information Application materials, frequently asked questions and other information can be found at http://mn.gov/deed/business/ 1/10/14 Business and Community Development Division 1st National Bank Building ■ 332 Minnesota Street, Suite E200 ■ Saint Paul, MN 55101-1351 USA ■ www.positivelyminnesota.com Toll Free: 800-657-3858 ■ Phone: 651-259-7114 ■ Fax: 651-296-5287 ■ TTY: 651-296-3900 -1n equal opporluni(y employee and service provider.