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1002-B.c BUSINESS SUBSIDIES POLICY (App. 7/02) |
Approved: 7/22/02 Revised: Stewartville Public Schools Business Subsidies Policy BACKGROUND: From time to time Stewartville Public Schools may be asked by various entities to provide some form of business subsidy to a private sector business. A variety of vehicles may be available to the Stewartville Public Schools to provide assistance including grants, tax-increment districts, and abatement of taxes. This policy is being adopted for purposes of compliance with the business subsidy act set out as Minnesota Statutes, Sections 116J.993 through 116J.995 (the “Act”). Stewartville Public Schools will adopt a policy that sets forth criteria the Stewartville Public Schools will use to consider awarding business subsidies. Requests from other governments for housing or other types of assistance are also to be subject to this policy. The following criteria may be used in evaluating business subsidies in addition to other policy requirements of the Board of Education. Stewartville Public Schools will retain flexibility to apply these criteria as appropriate to specific projects. Stewartville Public Schools may deviate from its criteria, but any such deviation shall be approved by the Board of Education, and any deviations from the criteria shall be documented by the Stewartville Public Schools. Stewartville Public Schools recognizes that business subsidies create costs to taxpayers and that a subsidy request must provide sufficient public benefit to the community as a whole to warrant the costs. This policy does not pertain to the Tax Increment Financing Districts created by underlying local governments over which the Stewartville Public Schools have no control. This policy supersedes all prior adopted business subsidy policies and becomes effective upon adoption by the Stewartville Public Schools Board of Education. CRITERIA TO BE CONSIDERED: An applicant for a business subsidy must answer these questions for review by District 534 staff and the Board of Education. 1. Public Purpose. Business subsidies must serve a public purpose as determined by Stewartville Public Schools in light of the enabling legislation or authority authorizing the business subsidy to be made. Eligible public purposes include, among others, the provision of health care services at reduced cost, the provision of health care services previously unavailable in the community, the provision of services for persons with mental or physical disabilities, community development, recreation, civic or educational activities or services, social or welfare services, including the provision of food or shelter to needy individuals or families, the creation of employment opportunities or the retention of employment if job loss is specific and demonstrable. A business subsidy must meet a public purpose other than or in addition to increasing the tax base of the School District and other taxing jurisdictions. 2. Other Policies. Because Stewartville Public Schools cannot anticipate every type of project that may pose a variety of public purposes and objectives, Stewartville Public Schools may consider any or all of the following criteria, as appropriate to a given project, in evaluating a proposed business subsidy. a) Profitability. District 534 will consider whether or not a business subsidy is necessary for a project to achieve financial feasibility. Stewartville Public Schools will not subsidize to add to a profit. b) Broad Benefit. The Stewartville Public Schools will consider whether the business subsidy benefits only a few citizens or a limited area. Approved business subsidies must have a general community impact. c) Other Subsidies. The Stewartville Public Schools will consider whether the other governments or not-for-profits serving the project have considered a request for a subsidy of any kind, what findings they document, and the conclusion they reach. d) Unfair Competition Between Businesses. The Stewartville Public Schools will consider whether a business subsidy would give an unfair competitive advantage over pre-existing, taxpaying businesses in the Stewartville Public School District 534. e) Unfair Competition Between Local Governments. The Stewartville Public Schools will consider whether underlying local governments are competing with each other and whether such competition is for the greater good or detriment of the whole District 534. f) Ability to Repay. The Stewartville Public Schools will consider whether the business has the ability to repay the business subsidy in the event of success or failure. Some subsidies may be structured as start-up loans. g) Precendent Set. The Stewartville Public Schools will consider whether awarding a business subsidy would require that the Stewartville Public Schools offer comparable terms to other organizations. h) Efficiency of Form of Subsidy. The Stewartville Public Schools will consider whether the form of business subsidy requested requires excessive administrative effort to accomplish the task and the cost to other taxpayers of the administrative effort. Stewartville Public Schools staff will prepare an analysis of the cost of the effort required to maintain the Subsidy. ANALYSIS OF FACTORS: In order to grant a business subsidy, the Board of Education must find after a public hearing that the preponderance of the answers to the criteria questions are answered in such a way so as to justify the granting of a business subsidy. In addition, no subsidy may be granted which Federal or State law prohibits. PROCEDURE: Entities that wish to seek a business subsidy from Stewartville Public Schools must provide: A. a general overall business plan narrative, B. complete answers to the above Criteria questions labeled by section and subsection, C. the attachments to this policy, A and B, must be completed, D. additional answers to background questions required by the Board of Education, Administration, and Finance, and E. an application fee deposit of a minimum of ($3,000) will be required from for-profit entities. If the initial deposit is insufficient more funds will be requested from the applicant. Staff are not allowed to work beyond the fees actually received and create a receivable. The fee will be used to reimburse the Stewartville Public Schools for staff time and material costs; any excess will be returned. F. all of these materials must be supplied with a cover letter that certifies that the materials supplied are true and correct to the best knowledge of the signed applicant and that the signed applicant is authorized by the applying entity(ies) to make the application. Upon receipt of the required materials from the applicant, Stewartville Public Schools’ staff will review the supplied materials and prepare a recommendation to the Board of Education. Staff will provide the materials from the applicant and a recommendation to the Board in a request for Board Action. The applicant must allow adequate time for this step so that staff may make an adequate review. The amount of time required will vary depending upon the staff workload and assigned tasks. 1. If the Board of Education chooses to allow the request to advance to the public hearing step, the Board will set a date for a public hearing (meeting the requirements of Minnesota Laws) and hold the hearing. 2. Upon closure of the public hearing the Board of Education may direct the staff to prepare the required Board Resolution and a contract containing goals with the entity to receive the subsidy. 3. The applicant to receive the subsidy must agree in the contract to provide the reports necessary to meet the requirements of the Business Subsidy statute and Stewartville Public School’s information needs. |
