03.01.22 Work Session - Laserfiche WebLink

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City Council Meeting Minutes March 1, 2022 policy, it does not have an incentive per job component. She clarified that if a project scores, for example, 78 points, they may still have a year that is at 100 or 90 or 80% in that year, but their entire incentive proposal should not exceed 70% of the estimated total tax liability over 10 years. She thanked Council for direction given and thanked GSMP, EDSM, Chamber, and all businesses that choose to make San Marcos home. From City staffs position, there is one key item that Mrs. Jordan Lee asked for direction on is whether to keep the current policy position on tax -based incentives where the total tax rate can be considered, that's including both the M&O and I&S portions, (of course, knowing that City Council may have a preference to direct GSW to start negotiations at or below that M&O threshold), or if the City Council wants to have the tax rate limitation ingrained into the policy itself so that it's completely taken off the table. Mayor Hughson inquired about projects being considered on a case-by-case basis regarding these tax -based incentives. Anna Miranda, Interim Director of Finance, provided explanation on the calculation of the Total Tax Rate and M&O. Mayor Hughson asked if we are trying to be competitive why would we offer the M&O only. Mrs. Reyes said this is not the more competitive option but this creates a more revenue neutral opportunity and also considers the total tax rate. Mr. Scott said he does not want to lose money, and he used to like incentives, but as growth is imminent, he would be okay seeing less incentives being given out. Mayor Hughson reminded Mr. Scott that we consider each application for incentives separately and make the final determination on the percents and years rebated. Mrs. Jordan Lee said staff does try to capture other sources of revenue. Council Member Baker said issuing the I&S rate is not fiscally responsible. He hears that we might lose out or not be competitive however he does not think we need to seek out or beg and plead to bring these companies to the City. He spoke on other cities in our region getting these companies and that is okay. He also spoke on scoring matrix and thinks labor force practices and environmental sustainability should be higher. Mrs. Reyes said it is discretionary on Council's part of what they want to do. This is an opportunity to look at what council wants to see in terms of how we grow. These are tools and it is not a "shall provide" but "may provide". How do we diversify this is something staff needs to hear. City of San Marcos Page 6