HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/16/1999 - FIRST READING OF ORDINANCE NO. 190, 1999, APPROPRI AGENDA ITEM SUMMARY ITEM NUMBER: 17
DATE: November 16, 1998
FORT COLLINS CITY COUNCIL Frank W. Bruno
STAFF: Alan J. Krcmarik
SUBJECT:
First Reading of Ordinance No. 190, 1999, Appropriating Prior Year Reserves for the 1998
Manufacturer's Use Tax Rebate Program.
RECOMMENDATION:
Staff recommends adoption of the Ordinance on First Reading.
FINANCIAL IMPACT:
The 1998 Manufacturers Rebate program will require an appropriation from the Sales and Use Tax
Carryover Reserve of approximately for $424,717.
EXECUTIVE SUMMARY:
In March 1996, City Council approved a temporary rebate program for use tax paid on
manufacturing equipment. The program was amended in February 1999 to include several changes
suggested by staff and the manufacturing community. The goal of the program is to maintain the
local economic base by providing modest tax relief to manufacturing concerns located in Fort
Collins. During 1998,the City of Fort Collins received$4,298,241 in use tax receipts from eligible
companies within the Standard Industrial Code classification for manufacturers. This constitutes
72% of all use tax paid by local businesses in 1998.
BACKGROUND:
Twenty-seven applications were sent to qualified manufacturers. Ten (10) rebate applications
requesting approximately $620,000 were returned. An additional applicant requested an extension
but has not yet filed the paperwork for the rebate. The eligible companies and the amounts of their
rebates are as follows:
DATE: November 16, 1999 2 ITEM NUMBER: 17
Corn.pany Rebate
HevrlY tt Packarci Cam a'." 15O tHSt3=.
Anheuser-Busch, Inc. 150,000
XX
14k&P Er1Y8 Ilsea ': 58,5�
Symbios Logic (Estimate) 25,000
Advanced Energy Industries 21,226
Atria am.Or ....Inc 1 6#
New Belgium Brewing Com an 5,933
igtt'TBCtM It1C,:> 964
O'Dell Brewing Cornea 118
itiieetad Ensr" ,Inc 93
Total $424,717
SUMMARY:
The 1998 rebate reflects the expansion of Anheuser-Busch,Inc. While other companies may have
experienced some expansion, the impact on the program was minimal. Celestica of Colorado
requested a rebate for 1998 but was denied because it did not meet the program requirement to be
manufacturing in Fort Collins for three years to be eligible for a rebate. That provision was removed
from the program in February 1999 with City Council approval.
The Manufacturers Use Tax Rebate Program has been extended for tax year1999 and applications
for that program will be received in early 2000. Staff is also requesting that the program be extended
for 2000. Staff will continue to provide the City Manager with updates on the status of the program
and the potential financial liability.
• ORDINANCE NO. 190, 1999
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING PRIOR YEAR RESERVES
FOR THE 1998 MANUFACTURER'S USE TAX REBATE PROGRAM
WHEREAS, in March 1996, City Council approved a temporary program for the rebate of
use tax paid on manufacturing equipment; and
WHEREAS, in June 1998, the Council adopted Ordinance No. 109, 1998, continuing the
rebate program for 1998; and
WHEREAS, the goal of this program is to support the local economic base by providing
modest tax relief to manufacturing concerns located in Fort Collins; and
WHEREAS, in early 1999, twenty-seven (27) applications were sent to qualified
manufacturers who paid use tax in 1998; and
WHEREAS,staffhas received eleven(11)applications requesting a rebate and has approved
rebates totaling approximately $424,717 to be returned to the manufacturers; and
• WHEREAS,the money to rebate these funds is available in the Sales and Use Tax fund Use
Tax Carryover Reserve; and
WHEREAS,Article V, Section 9,of the Charter of the City of Fort Collins permits the City
Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as
may be available from reserves accumulated in prior years,notwithstanding that such reserves were
not previously appropriated.
NOW,THEREFORE,BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that there is hereby appropriated for expenditure from the Sales and Use Tax Fund Use
Tax Carryover Reserve, the sum of FOUR HUNDRED TWENTY-FOUR THOUSAND SEVEN
HUNDRED AND SEVENTEEN DOLLARS ($424,717) for the 1998 Manufacturer's Use Tax
Rebate Program.
Introduced and considered favorably on first reading and ordered published this 16th day of -
November,A.D. 1999,and to be presented for final passage on the 7th day of December,A.D. 1999.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 7th day of December, A.D. 1999.
Mayor
ATTEST:
City Clerk