HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/20/2001 - FIRST READING OF ORDINANCE NO. 200, 2001, APPROPRI AGENDA ITEM SUMMARY ITEM NUMBER: 1 r.
FORT COLLINS CITY COUNCIL DATE: November 20, 2001STAFF: Frank W. Bruno
Alan J. Krcmarik
SU13JECT:
First Reading of Ordinance No. 200, 2001,Appropriating Prior Year Use Tax Carryover Reserves
for the Manufacturer's Use Tax Rebate Program.
RECOMMENDATION:
Staff recommends adoption of the Ordinance on First Reading.
FINANCIAL IMPACT:
The 2001 Manufacturers Rebate program(for tax year 2000 rebates) will require an appropriation
from the Sales and Use Tax Carryover Reserve of approximately $498,020.
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 2000,the City of Fort Collins received$3,438,535 in use tax receipts from eligible
companies within the Standard Industrial Code classification for manufacturers. This constitutes
65% of all use tax paid by local businesses in 2000.
BACKGROUND:
Thirty-seven applications were sent to qualified manufacturers. Thirteen(13) rebate applications
requesting approximately $655,885 in rebates of tax year 2000 use taxes were received.The eligible
companies and the estimated amounts of their rebates are as follows:
DATE: November20, 2001 2 ITEM NUMBER:
Company Estimated Rebate
Advanced Manufacturing 148
Anheuser-Busch, Inc. 139,799
Celestica Colorado 61,532
Ion Tech 2,969 c
New Belgium Brewing 17,981
Ranchway Feeds 1,938
PlasttcS 5
Total $498,020
SUMMARY:
The tax year 2000 rebate reflects the expansion at the Anheuser-Busch facility as well as new
equipment purchases for LSI, Inc. The estimated rebate of$498,020 is over 50% more than the
1999 rebate of$329,134. The increase is due to strong manufacturing equipment purchases from
the major manufacturers.
The Manufacturers Use Tax Rebate Program was extended for 2001 in late 2000. Staff will continue
to monitor the program and to provide the City Manager with updates on the status of the program
and the potential financial liability.
I
i
ORDINANCE NO. 200, 2001
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING PRIOR YEAR USE TAX CARRYOVER RESERVES
FOR THE MANUFACTURER'S USE TAX REBATE PROGRAM
WHEREAS, in March 1996, the City Council originally approved a temporary rebate
program for use tax paid on manufacturing equipment; and
WHEREAS, the City Council extended that temporary program on an annual basis
through tax year 1999, and in December 2000, adopted Ordinance No. 173, 2000, approving the
rebate program for tax years 2000 and 2001; 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 2001, thirty-seven (37) applications were sent to qualified
manufacturers for rebates for the 2000 tax year; and
WHEREAS, the City has received thirteen (13) applications requesting rebates of 2000
use taxes for a total of approximately $498,020 to be returned to the manufacturers through the
rebate program; 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 NINETY-EIGHT
THOUSAND TWENTY DOLLARS ($498,020) for the Manufacturer's Use Tax Rebate
Program.
Introduced, considered favorably on first reading and ordered published this 20th day of
November, A.D. 2001, and to be presented for final passage on the 18th day of December, A.D.
2001.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 18th day of December, A.D. 2001,
Mayor
ATTEST:
City Clerk