By JAN LARSON McLAUGHLIN
BG Independent News
Bowling Green City Council member Bruce Jeffers isn’t against business. He’s just doesn’t like the idea of having to offer incentives to attract them to the city.
So before council voted on an ordinance Monday evening for a new job creation and retention program, he had a few questions.
“I value our businesses in Bowling Green,” Jeffers said. And the city has done a good job of making sure the community has good infrastructure and energy options for prospective businesses, he said.
“So I wonder why we need to offer incentives for businesses to come here,” he said. “The answer seems to be because everyone else does it.”
That answer is partially true, responded City Attorney Mike Marsh.
Incentives like tax abatements are nothing new, Marsh explained.
“I wrote the first one 32 years ago,” he said of the first city incentives program for Bowling Green.
The city, Marsh said, doesn’t offer every possible incentive, but picks and chooses what works best here.
“You don’t have to have the exact same programs, but you need to have some things tailored for who we want to attract,” he said.
So the city is selective in its incentives.
“We don’t want people who want to come here and not pay any taxes,” Marsh said. “We’re not desperate. We don’t want to give away the store.”
However, without some incentives, the city may not even get a glance from some perspective businesses.
“Then again, if we didn’t have them, we might not have gotten them to look at us,” Marsh said.
Council went on to unanimously approve the new job creation and retention program. According to Assistant Municipal Administrator Joe Fawcett, the program is modeled after one used by the city of Maumee. Similar programs were reviewed from dozens of cities, he said.
The purpose of the city’s program is to “help maintain Bowling Green’s competitiveness as a location for new businesses and the expansion or retention of existing businesses.”
The program offers incentives to qualifying businesses that agree to create a specified number of new jobs. Eligible businesses include headquarters, manufacturing, science and technology, research and development, distribution and certain types of service industries.
To get incentives, the business must create jobs which are new to the city. The jobs must equal a minimum annual local payroll totaling $350,000 within a three-year period. Companies may receive up to 50 percent of the total payroll tax that the city receives from those jobs for a period of three years.
For the retention of existing jobs, the program gives consideration to companies contemplating leaving Bowling Green for sound financial or economic reasons. An existing company claiming job retention would be eligible for a grant based upon the amount of payroll for those jobs to potentially be lost if the retention effort is not successful.
Businesses claiming retention must make a strong case that without this grant the company will either lose these jobs permanently or the company will close down permanently. The company may receive up to 50 percent of the total payroll tax that the city receives from those jobs for the period of up to three years.
The program includes steps to recapture city funds if the businesses fail to live up to their end of the agreements.
If the company fails to meet its projected payroll or employment projections during the three-year period, City Council may require the company to repay the grant funds awarded.
Each agreement will require the company to immediately reimburse the city for 100 percent of the amount they were granted if the business leaves or discontinues operations in the city during the three-year term of the agreement or during the post grant commitment period agreed to in the deal.