City of Lawrence

City Manager’s Office

TO:              David L. Corliss, City Manager

CC:               Cynthia Boecker, Assistant City Manager

                   Diane Stoddard, Assistant City Manager

FROM:          Roger Zalneraitis, Economic Development Coordinator/Planner

DATE:           November 3, 2008

RE:               Overview of Economic Development Material

Attached please find several documents that we wish to place on the future agenda’s schedule, possibly for a December City Commission Meeting.

Staff has been working over the last several months both to respond to direction provided by the City Commission in a January 2008 study session as well as present new policies and procedures to guide further discussion on economic development here.  The City has already received and approved ordinances for new Tax Increment Financing (TIF) and Transportation Development District (TDD) policies.  Staff has used the methods for developing those policies and applied them to several new initiatives for consideration.

In every case, extensive background research has been conducted to identify how nearby communities and similar cities throughout the region approach these issues.  Where previous policies or analyses have existed, those have been reviewed as well for consideration and incorporation into updated ideas.  Finally, whenever possible Staff has met with interested parties both within the Economic Partnership (the City, County, and Chamber of Commerce) as well as members of the community to receive feedback for further refinement of proposals.

Staff views the polices and models presented herein as drafts subject to further comment from both City Commission and the public.  We welcome the opportunity to present this information in either a City Commission meeting or a study session.

Below is a list of the attached documents as well as a brief explanation for each:

· A memo on the new Overarching Economic Development Policy, the Tax Abatement Policy, PIRC and the Economic Development Board- this memo provides an overview of the existing Tax Abatement policy, the PIRC, and the Economic Development Board.  It also proposes a policy to guide the processes and procedures for cash-like incentives not covered by state policies.  The memo concludes with several issues that warrant further discussion by the City Commission. 

Two documents associated with this memo follow:

o The draft Overarching Economic Development Policy- the policy that is intended to guide the processes and procedures for cash-like incentives not covered by state policies, and

o The Tax Abatement Policy- the policy as adopted by the City in 2003, along with several comments for further consideration.

A second set of documents relate to the new benefit-cost model developed by City Staff:

· An Overview of the Model- This memo provides a background to the reason for developing the model, as well as the research conducted, a brief overview of the revenues, costs and key assumptions, and the results of the initial review process;

· An Analysis of Making the 87 Acre Site Pad Ready for Development- A summary discussion of an application of the draft Benefit-Cost model to the 87 acre industrial site located on the east side of Noria Road in East Business Hills;

· Follow-up Discussion Items for the Benefit-Cost Model- Based on comments and feedback from three separate meetings on the new model, this memo outlines key items for future consideration as well as recommendations.

As in the case of the new economic development policies, two documents associated with the benefit-cost model are provided:

o The application form for the Benefit-Cost model- this shows the information and data being requested from the applicant for a tax abatement or other cash-like incentive; and

o A sample output from the Benefit-Cost model- This shows the output from the benefit-cost model for one of the scenarios run under the 87 Acre analysis.