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Home My WebLink AboutRedmond Enterprise Zone AmendmentAgreement for Oregon Enterprise Zone Extended Abatement Greater Redmond Area Enterprise Zone WRITTEN AGREEMENT WITH THE GREATER REDMOND AREA ENTERPRISE ZONE SPONSORS TO EXTEND PROPERTY TAX EXEMPTION TO FIVE CONSECUTIVE YEARS IN TOTAL FOR CAPITAL INVESTMENT BY PAPE TRUCKS, INC. (dba) PAPE KENWORTH. The City of Redmond, Deschutes County and the City of Sisters, co-sponsors of the Greater Redmond Area Enterprise Zone (hereinafter "The Zone Sponsor") and Pape Trucks, Inc. dba Pape Kenworth, (hereinafter ''The Firm") do hereby enter into an agreement for extending the period of time in which The Firm shall receive an exemption on its proposed investment in qualified property in the Greater Redmond Area Enterprise Zone contingent on certain special requirements, under ORS 285C.160 (2003). The Zone Sponsor and The Firm jointly acknowledge, that subject to timely submission and approval of an application for authorization and the satisfaction of other requirements under ORS 285C.050 to 285C.250, The Firm is eligible for three years of complete exemption on its qualified property; that nothing in this agreement shall modify or infringe on this three-year exemption or the requirements thereof, and that this agreement becomes null and void if The Firm does not qualify for these three years of the exemption. The Zone Sponsor extends The Firm's property tax exemption an additional year on all property that initially qualifies in the Greater Redmond Area Enterprise Zone after the assessment year beginning on January 1, 2013 and, thus, sets a total period of exemption of four consecutive years during which statutory requirements for the standard three-year enterprise zone exemption must also be satisfied and maintained. CONFIRMATION OF STATUTORY PROVISIONS In order to receive the additional year of enterprise zone exemption granted herein, The Firm agrees herewith under 285C.160(3)(a)(A) that for each year of the entire exemption period, The Firm's average annual compensation for all new employees is equal to or greater than 150 percent of the county average annual wage, in accordance with the specific definitions and guidelines in Oregon Administrative Rules (OAR 123-065-4100 -4140) which provides that: 1. Such compensation may include non-mandatory benefits that can be monetized; 2. The county average annual wage is set at the time of authorization, except as pursuant to ORS 285C.160(4). according to the 2010 Deschutes County average annual payroll rate of $35,229. for which 150 percent (includes total compensation package) equals $52,844; 3. Only employees working at jobs filled for the first time after the application for authorization but by December 31 of the first full year of the initial exemption and performed within the current boundaries of the Greater Redmond Area Enterprise Zone are counted; and 4. Only full-time, year-round and non-temporary employees engaged a majority of their time in The Firm's eligible operations consistent with ORS 285C.135 & 285C.200(3) are counted, regardless if such employees are leased, contracted for or otherwise obtained through an extemal agency or are employed directly by The Firm. ACCEPTING FOR THE CO-SPONSORS OF THE GREATER REDMOND AREA ENTERPRISE ZONE: ''''_'-:-__ Date: 5 {8ItZ"Signature: ..,.,..~..:;...=-,,..q..____......;~~-=.__ Signature: _____________ Tony DeBone, Board Chair, Deschutes County Date: _______ Signature: _____________ lon Kellstorm, Mayor, City of Sisters Date: _______ ACCEPTING FOR Pape Trucks, Inc. dba Pape Kenworth: Signature: ___===~==--_____ ReprosentatlVi Signature Date: _______ PriniiIIJ Name I Tiili Address City. Stale. Zip PhcnelFax Email CITY OF REDMOND 716 SW Evergreen Avenue Community Development Department Redmond, OR 97756 (541) 923-7721 Fax: (541) 548-0706 www.ci.redmond.or.us STAFF REPORT DATE: May 8, 2012 TO: Mayor and Council Members THROUGH: David Brandt, City Manager FROM: Heather Richards. Community Development Director SUBJECT: Extended Enterprise Zone Abatement Agreement -Pape Addresses Council Goal: 3. ECONOMIC DEVELOPMENT: Encourage economic development by continuing to utilize business location incentives, ensuring an adequate supply of planned industrial, commercial and residential land, and supporting workforce development programs. A. Work to sustain existing jobs and attract new jobs to the City of Redmond. Report in Brief: Pape Trucks, Inc. dba Pape Kenworth has submitted an application for the Oregon Enterprise Zone Extended Abatement. Council's approval for the agreement is required. Background: All employment lands in the City of Redmond are part of the Greater Redmond Area Enterprise Zone. Under this program, qualifying businesses receive 100% exemption for three (3) years from property taxes normally assessed on Significant new plant or equipment improvements. Additionally, the City waives or reduces, depending upon specific set criteria, building and permitting fees. Qualifying businesses can apply to receive two additional years of exemption, for a total of up to five consecutive years. During each of years four and five, the average annual compensation for new employees must be at least 150% of Deschutes County's average annual compensation. Deschutes County's average annual compensation (2010) is $35,229 per year. To qualify for the extended abatement (150% of the County's average annual compensation standard), necessitates average annual compensation wages for new employees in excess of $52,844 per year. Compensation under the criteria includes not only salary, but overtime. medical and retirement benefits as well. Discussion: To better serve transportation businesses in Central Oregon, Pape Trucks. Inc. dba Pape Kenworth intends to construct a $2 million, 15,000 square foot facility on three acres at Hemlock Avenue to provide repair services to trucking customers through Central Oregon. including light maintenance to major and overhaul work. With its capital investment and intentions to grow its workforce by more than 10%, by adding four or more employees, Pape Trucks. Inc. dba Pape Kenworth qualifies for the Greater Redmond Area Enterprise Zone program. Pape's average annual compensation for its new employees will be greater than 150% of the Deschutes County's average annual compensation. qualifying it for the Enterprise Zone Extended Attachments: GreRler Redmond AleR Enternrise Zone Eldended Almtement Aareement with PROR Trucks. Inc. dim Pane Kenworlh. Abatement program (2013-2017). Pape Trucks, Inc. dba Pape Kenworth has confirmed compliance with the wage provision discussed above. The program requires eligible firms to enter into a written agreement with the zone sponsors prior to authorization approval. Approval is required from all of the co-sponsors of the Greater Redmond Area Enterprise Zone (City of Redmond, Deschutes County and the City of Sisters). This Enterprise Zone Extended Abatement Agreement is for one additional year. Fiscal Impact: This action will extend the property tax abatement for the qualified project by one year, impacting the City of Redmond's property tax collections. Alternative Courses of Action: 1. Approve the Agreement for Oregon Enterprise Zone Extended Abatement for Pape Trucks, Inc. dba Pape Kenworth. 2. Do not approve the Agreement for Oregon Enterprise Zone Extended Abatement for Pape Trucks, Inc. dba Pape Kenworth. Recommendation/Suggested Motion: "I move to approve the Agreement for Oregon Enterprise Zone Extended Abatement for Pape Trucks, Inc. dba Pape Kenworth." Heather Richards Community Development Director Attachments: Greater Redmond Area Enterorise Zone Extended Ahatement Aareement with Paoe Trucks. Inc. dhR Paoe Kenwnrlh.