Elk Grove City Council Approves Economic Incentive Plan

Hopes to attract high paying non-retail jobs Like many other government agencies whose near term economic outlook is cloudy, the Elk Grov...

Hopes to attract high paying non-retail jobs


Like many other government agencies whose near term economic outlook is cloudy, the Elk Grove City Council decided tonight to take employ what Mayor Pat Hume called "creative thinking" to brighten future prospects for the city.

In a 4-0 vote (council member Gary Davis was absent) the council approved an economic incentive plan meant to attract businesses who would bring a minimum of 20 jobs that pay the average median income (AMI) to the city.

Presenting the plan to the council was city senior management analyst Heather Ross who said in preparing the program city staff looked at other city who have similar programs. "They usually did not have direct cash incentives," she said "They usually are done through redevelopment centers or enterprise zones."

Steve Czarnecki Elk Grove Economic Development Corp executive director who worked with the city on development of the plan said was a good move to help attract businesses with well pay jobs.

"The city will send a clear message. Elk Grove is doing every thing it can to compete for for new jobs," Czarnecki said. "It is a good program, I would encourage your your support of this program."

Also speaking in favor of the plan was Janet Toppenberg, president of the Elk Grove Chamber of Commerce. Toppenberg said the global recession has hurt the local economy leading to the loss of many jobs.

"This is just the type of innovative program the community needs," Toppenberg said. "It is not a city give away."

By approving the plan, the city will offer a variety of incentives aimed at attracting employers who create 20 jobs paying 100% of the current AMI, or about $51,000 annually or 50 jobs at 75% of the AMI, or about $38,000 annually.

Aside from the income requirements, qualifying businesses must generate either $15 million in new taxable sales or $250,000 in transient occupancy tax revenue, or locate in Elk Grove's Old town special planning area or occupy a existing vacant structure.

The incentives include either the reduction of development impact fees, deferral of fees, economic development grants, inter-agency plan coordination or expedited plan reviews.

According to the staff report, the cost for the program has not been budgeted and any payments for the current fiscal year would come out of general fund reserves or other budgeted accounts.

In approving the plan Hume noted that the discussion took only 15 minutes versus over two hours of a transit discussion (that will require further deliberations) and said, "Now this is truly creative thinking."

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3 comments

Anonymous said...

Where is Gary Davis? It sure seems like he is missing a lot of Council Meetings as of late. Too busy campaigning?

Anonymous said...

A reasonable incentive program to attract business to the community and our historic district! Nicely done.

Phillip Stark
Old Town EG

Insania said...

Looking at the list of locally owned businesses listed on the left side of ElkGroveNews.net, I'm hard pressed to believe that any one of these existing businesses would meet this new requirement.

That is, no incentive for more locally owned and operated businesses; again, the sort of businesses that return a larger share of your spent dollar back into the local economy.

Perhaps we'll attract another finance & insurance qualifier with this incentive. An industry that manages the financial affairs of things produced by other people elsewhere. But are we going to see growth in that sector anytime soon?

I could see a new construction equipment or contractor business...but this assumes a rebound of our suburban sprawl buildout and in the near term that doesn't appear likely.

If not housal unit contractors then perhaps another commercial land development company. Insania Enterprises, LLC. Sadly, our spate of retail vacancies might defer such new emergents for some time.

Manufacturing has long been out of the running. Elk Grove's role in the global economy is to consume stuff, not to build stuff.

Remember our first generation big boxes around here? The KMarts and the Lumberjacks? We're now well into our second generation with the Costcos and Lowes...but the third generation is coming. Perhaps the third generation will include large format dining. Wherehoused eateries. I wonder...would that qualifying 75% AMI job include receipts from tips as well as from wages?

So...we're down to telecom, health care, waste management, another auto dealership or third generation big box. I'd wager the latter.

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