Okaloosa County BOCC — December 18, 2012 — Project Machine Memo — reading text

MEMO Date: January 30, 2013 To: Jim Curry, Okaloosa County Administrator From: Kay Rasmussen, Interim President Subject: Public Hearing supporting documents for February 5, 2013 BCC meeting for consideration of an Economic Ad Valorem Tax Exemption for Project Machine. Project Machine Return on Investment: þ Current jobs: 19 New jobs: 15 Total: 34 þ Average Wage: $50,750; 143% of the Okaloosa Average Wage þ Capital Investment: $1,275,612 þ Expansion of a company that has been in the county for 19 years þ Industry Diversification County Incentive Requested: Ad Valorem Tax Exemption Program State Incentive: Qualified Targeted Industry Tax Refund Program 80% $36,000 Local Incentive: Ad Valorem Tax Exemption 20% $9,000 100% $45,000 Local Exemption Schedule: Tangible Personal Property Tax Year 1 $2,599 Year 2 $2,337 Year 3 $2,019 Year 4 $1,783 Year 5 $262 P.O. Box 4097, Fort Walton Beach, FL 32549 - (850)362-6467 Page 1 of 2 At the January 8, 2013 board meeting, the Economic Development Council of Okaloosa County requested that the Board of County Commissioner’s consider providing an Economic Development Ad Valorem Tax Exemption for Project Machine, a business located in Holt. The documents that have been provided have been coded to protect confidentiality pursuant to Florida Statute 288.075. At this meeting, the BCC approved moving forward with providing an ED Ad Valorem Tax Exemption for Project Machine. The BCC scheduled the public hearing for the February 5, 2013 BCC meeting. A public notice was advertised on January 18, 2013 (Exhibit E). The ED Ad Valorem Tax Exemption will provide the 20% required local financial support match for the Qualified Target Industry Tax Refund program administered by the state. The proposed resolution (Exhibit A) reflects the Ad Valorem Tax Exemption year-to-year values based on assessments conducted by the Okaloosa County Property Appraiser’s office. The proposed ordinance for adoption has also been provided (Exhibit B). After the public hearing and, if adopted, the EDC requests that the Chairman of the Board approve and sign the appropriate resolution in conjunction with the ordinance. Resolution (Exhibit A) In working with the company and the Property Appraiser’s office, the EDC would like to recommend the attached resolution for “Project Machine” (Exhibit A). o This resolution requests the BCC to consider supporting an Ad Valorem Tax Exemption for the Tangible Personal Property (TPP) taxes for this project. o Additionally, it is important to note that the company plans on making Real Property improvements with this project and the county will still collect 100% Real Property taxes, and any increase in Real Property taxes from this company. The county will also continue to collect Tangible Personal Property taxes currently on the tax roll. This Exemption will only apply to the expected TPP increase. o The request is for a maximum of $9,000 in Tangible Personal Property Tax Exemptions over a 5 year period. o The formula for this amount is based on the state’s calculations of $3,000 per job times 15 full time positions totaling $45,000. The average wage is to be $50,750 or at least 143% of the average wage in the Okaloosa County area. o Of the $45,000 that “Project Machine” is eligible for, the state will provide 80% or $36,000 if the county provides 20% or $9,000 as its match over the 5 year period. o This will be for the Exemption of Ad Valorem taxes collected for tangible personal property not currently on the tax roll (future value) for this 5 year period. Additional Attachments o Exhibit C - Property Appraiser’s Office Tangible Personal Property Exemption calculations for “Project Machine” o Exhibit D - Property Appraiser’s Form DR-418 regarding company’s TPP taxes for future purchases. Thank you for your consideration to this request and future development! P.O. Box 4097, Fort Walton Beach, FL 32549 - (850)362-6467 Page 2 of 2