Title
A Resolution Approving An Economic Development Agreement Between The City Of Colorado Springs And Meyer Burger
Presenter:
Bob Cope, Economic Development Officer
Shawna Lippert, Senior Economic Development Specialist
Body
Summary:
Meyer Burger Technology is an industrial manufacturer of solar cells and solar modules. The company intends to manufacture solar cells in Colorado Springs They are an international company headquartered in Switzerland. Meyer Burger is publicly traded on the SIX Swiss Exchange under the trading symbol MYBUF. This has been a competitive project as the company was considering other US locations for expansion. Meyer Burger is a Primary Employer, as they generate more than 50% of their revenue from outside of El Paso County. Meyer Burger plans to secure and remodel an existing Facility in Colorado Springs. Additionally, the company plans to hire 380 employees over the next three years. With the creation of these new full-time jobs, Meyer Burger plans to invest in business personal property, including furniture, fixtures, machinery, equipment, and construction materials for its facilities redevelopment and expansion. The Executive Branch is recommending that the City provide certain performance-based incentives for the company investment and job growth.
Background:
Meyer Burger has investment plans for business personal property, construction materials, and job creation for its Colorado Springs facilities. The company estimates that it will invest $403.5 million in purchases of construction materials, furniture, fixtures, machinery, and equipment. The company expects to hire 380 new full-time employees over the next 3 years at an average wage of $77,842.
The Executive Branch is recommending that the City enter into an Economic Development Agreement to provide certain performance-based incentives for the company to invest in business personal property, construction materials, and job creation. The proposed City incentives are:
Sales and Use Tax Rebate on Annual Purchases of Business Personal Property (50% of the City’s 2% General Fund Rate, or a 1% Total Rebate).
Sales and Use Tax Rebate on Purchases of Construction Materials (50% of the City’s 2% General Fund Rate, or a 1% Total Rebate).
The Executive Branch is recommending a ten (10) year agreement based on the level of projected investment and new job creation.
Previous Council Action:
N/A
Financial Implications:
City staff has conducted an Economic and Fiscal Impact Analysis (EFIA) to quantify the estimated economic benefit to the City that is expected to be derived by the expansion of Meyer Burger in Colorado Springs. The following is a summary of the results:
COMMUNITY BENEFITS (ECONOMIC IMPACTS)
10 Year Jobs Impact - Expansion: 814
The analysis indicates a total jobs impact from Meyer Burger’s operations over a 10-year period as follows: 814 jobs from expansion.
10 Year Local GMP Impact - Expansion: $1.07 Billion
The analysis indicates growth in Gross Metropolitan Product (GMP) over a 10-year period as follows: $1.07 billion from expansion.
CITY REVENUE (FISCAL IMPACTS)
10 Year City Incentives: $3,035,000
City incentives for Meyer Burger are estimated to be $3,035,000 over 10 years.
10 Year Net New City Revenue - Expansion: $38.5 Million
The analysis indicates a total net new city revenue from the Meyer Burger facilities in Colorado Springs over a 10-year period as follows: $38.5 million from expansion.
The proposed incentive structure incurs no financial risk since it is strictly performance-based, and revenue is rebated to the company only after it has been collected.
City Council Appointed Board/Commission/Committee Recommendation:
N/A
Stakeholder Process:
N/A
Alternatives:
N/A
Recommended Action
Proposed Motion:
Approve the Resolution approving an Economic Development Agreement between the City of Colorado Springs and Meyer Burger
Summary of Ordinance Language
N/A