This chapter may be cited as the "Economic Development Plan Ordinance."
[HISTORY: Adopted by the Town Council of the Town of Tatum at time of adoption of Code (see Ch. 1, General Provisions, Art. I). Amendments noted where applicable.]
GENERAL REFERENCES
Business registration — See Ch. 114.
The Economic Development Plan Ordinance is enacted pursuant to the statutory authority conferred upon municipalities to allow public support of economic development (NMSA §§ 5-10-1 through Section 5-10-13). This chapter is adopted as part of the Town's economic development plan.
A.
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 Town to enter into one or more joint powers agreement with other local governments to plan and support regional economic development projects.
B.
Local Economic Development Act. 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.
As used in this chapter, the following terms shall have the meanings indicated:
The provision of direct or indirect assistance to a qualifying entity by a local or regional government and includes the purchase, lease, grant, construction, reconstruction, improvement or other acquisition or conveyance of land, buildings or other infrastructure; public works improvements essential to the location 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 cultural facilities; purchase of land for a publicly held industrial park or a publicly owned cultural facility; and the construction of a building for use by a qualifying entity.
The Town of Tatum Council.
An agreement between a qualifying entity and the Town whereby the Town provides assistance to an economic development project in exchange for the benefits received as set forth in this chapter.
An existing or proposed corporation, limited-liability company, partnership, joint venture, syndicate, association or other person who or which is one or a combination of two or more of the following:
An industry for manufacturing, processing, or assembling of any agricultural or manufactured products.
A commercial enterprise for storing, warehousing, distributing, or selling products of agriculture, mining or industry, but other than as provided in Subsection D or E of this definition, not including any enterprise for 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 or E 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 facility for the direct sales by growers of agricultural products, commonly known as "farmers' markets."
A business that is the developer of a metropolitan redevelopment project.
A cultural facility.
A.
The Town, 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 Town 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 Town, at its discretion, may bear the full cost or contribute a portion of the costs, including the waiver of applicable fees. The Town, 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 Town's part to offer any specific type or level of assistance.
A.
The governing body assigns the EDC of Lea County Board of Directors the following responsibilities with regard to the economic development plan for the Town of Tatum:
B.
The EDC of Lea County shall at all times provide for a Board of Directors position for the Town of Tatum, and the Mayor shall appoint this member of the Board of Directors with the advice and consent of the Town Council.
A.
Any qualifying entity meeting the definition set forth in § 126-4 may propose an economic development project to the Town. Meeting the definition of "qualifying entity" does not create any obligation on the part of the Town of Tatum.
B.
Applications from qualifying entities shall be submitted to the Town of Tatum on forms provided by the Town.
D.
The project participation agreement and any other pertinent information will be forwarded to the governing body for final consideration at a public meeting.
A.
Applications for economic development projects requesting economic assistance from the Town, which meet the policies and objectives of the Town's economic development plan, shall receive priority.
(1)
Examples include, but are not limited to:
(a)
Manufacturing firms (including intellectual property such as computer software);
(b)
Projects which enhance the exporting capacity of companies and/or provide goods and services which currently have to be imported into Tatum;
(c)
Private companies seeking to build, expand or relocate facilities;
(d)
Private companies which provide facilities or services which enhance the ability of Tatum businesses to operate;
(e)
Organizations which assist business startups 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:
[1]
Business incubators.
[2]
Art incubators or coalitions (e.g., a performing arts coalition seeking to construct rehearsal or performance facilities).
[3]
Public markets for farmers, gardeners, crafts, etc.
[4]
Organizations which foster economic development by promoting workforce development efforts such as apprenticeships or other job training programs.
(2)
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.
(3)
Qualifying entities with existing contract or projects with the county 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 Town shall submit a cost-benefit analysis. Preparing a cost-benefit analysis shall be the responsibility of the applicant. The Town retains the right to specify a format and methodology for the cost-benefit analysis. The EDC of Lea County 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 Town 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 Tatum area;
(4)
Total payroll expected at startup 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 Town shall require the same review required of industrial revenue bond applications. This review shall focus on the 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 Tatum area residents. The 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 Town shall clearly demonstrate the benefits which will accrue to the community as a result of the donation of public resources. The Town has considerable flexibility in determining what is considered to be 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 Town 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 Town 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 Town shall be subject to an annual performance review conducted by the EDC of Lea County. 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 terminates the agreement and specifies the disposition of all assets and obligations of the project.
B.
The Town shall retain a security interest, which shall be specified 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 Town. Types of security may include, but are not limited to:
(1)
Letter of credit in the Town's name;
(2)
Performance bond equal to the Town's contribution;
(3)
A mortgage or lien on the property or equipment;
(4)
Pro-rated reimbursement of the donation if the company reduces its 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 Town 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 Town may choose to deny said assignment, lease or transfer or may negotiate a new agreement with the new operator, or the Town 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 governing body passes the project participation agreement.
A.
The qualifying entity shall prepare with the Town a project participation agreement. This agreement is the formal document which states the contribution and obligation of all parties to the economic development project. The agreement must state the following items:
(1)
The economic development goals of the project;
(2)
The contribution of the Town 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 Town's investment;
(6)
The procedures by which a project may be terminated and the Town's investment recovered; and
(7)
The time period for which the Town shall retain an interest in the project. Each project agreement shall have a "sunset" clause after which the Town shall relinquish interest in and oversight of the project.
B.
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 Town, with such account clearly identified. These accounts shall be subject to an annual independent audit.
The governing body may terminate this chapter and the Town'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 this chapter or any project participation agreement, any Town monies remaining in the project accounts shall be transferred to the Town's general fund.
The Town may engage in economic development projects involving one or more other government entities for projects which encompass more than one municipality. 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.