Glenwood Springs looking at providing tax incentives to boost area construction work
Glenwood Springs, CO Colorado
GLENWOOD SPRINGS, Colorado ” City Council and staff are trying to develop a sales tax rebate incentive designed to spark work for the hurting construction industry around Glenwood Springs and Garfield County.
A discussion at their regular meeting on April 16 regarding the proposed incentive program illustrated just how dire the situation for the local building industry is.
“I think that many are aware that the building industry in the Roaring Fork Valley and in Garfield County has been impacted by the downturn,” said Glenwood Springs City Manager Jeff Hecksel. “This is an attempt to help those people who do not have work, or have very little, to get more work.”
The program would allow qualified businesses to apply for either a “tier one” or “tier two” city sales tax rebate for up to five consecutive years.
Rebates could be applied toward such city-imposed fees, costs and taxes as water and sewer system improvement fees, fire and emergency service impact fees, or costs incurred for extension of the city’s electric lines. Building fees and city-required public improvements would only be available for tier two applicants.
The tier one rebates would not exceed 20 percent of the company’s annual city sales tax remittance in any one year, while the tier two rebate would not be allowed to exceed 80 percent.
For companies to be eligible, the city would require the applicants to have collected and paid all applicable sales, use or accommodations taxes. The applicant can’t be in violation of any building permit or development conditions and must pay all applicable city-imposed fees, including the fees for which the rebate is being applied.
Also, the proposed tier two applicants should attempt to use local contractors and suppliers as defined by the city’s municipal code for construction of the project.
Currently, the policy reads that the contractor at the time it is issued a certificate of occupancy the applicant would be required to provide detailed documentation on the amount of money paid to local contractors and suppliers.
Currently, the policy reads that at the time the contractor is issued a certificate of occupancy the applicant would be required to provide detailed documentation on the amount of money paid to local contractors and suppliers.
“The purpose is essentially really simple,” Hecksel said. “It’s to try and encourage people who are in the margin, who are either able to or really close to being able to do a project, but who maybe slightly short, to create an additional incentive. The string associated with that incentive is that they need to use local contractors to build that project.”
But requiring the use of local contractors is something that Councilman Russ Arensman supports because he said that the program would essentially shift the cost burden for some fees from the private sector to the public sector.
“When it comes to things like water taps and public improvements, these are things that we normally charge in development fees that are intended to offset the cost of development,” Arensman said. “So I think that it’s only fair that in return of that we expect and make mandatory some level of local contracting.”
Council will further discuss this item and may take action at its May 7 meeting.
Contact John Gardner: 384-9114
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