TITLE
Recommendation to authorize City Manager to enter into a 20-year Location Agreement with Dion and Sons, Inc. (Citywide)
DISCUSSION
In 1992, the City Council adopted the Retail Sales Tax Incentive Program outlining the policy for sales tax sharing to encourage the expansion of our retail base, improve retail sales tax productivity and stimulate private investment in the retail sector of the City's economy. After launching this program, several successful agreements were entered into, resulting in a significant increase in retail sales activity. Successful projects include the retention of key Long Beach auto dealerships including Hooman Toyota and Worthington Ford.
Based on the success of the Retail Sales Tax Program, the City later instituted another similar program intended to address retail sales. The new program was the Location Agreement Program (LAP). LAP is designed to attract new businesses, create jobs and enhance business-to-business sales tax revenue to the City. To qualify for assistance under the LAP, new businesses would be required to generate sales in Long Beach in excess of $50 million annually. A LAP agreement would remit to an eligible business a negotiated portion of the sales taxes generated by the business for an agreed upon period of time. The Administration is proposing to modify the LAP to add, as a goal, the retaining of existing Long Beach businesses that meet the following criteria:
· The business must be in an industry in which the City already has in place a location agreement and that location agreement has created a competitive disadvantage to the business being considered for the new location agreement.
· The business has existing sales revenues of at least $50 million annually that is either generated in Long Beach or can be consolidated to Long Beach.
· The business has a sales office in Long Beach, and pursuant to its business plan, it would consolidate other sales into its Long Beach location, thereby increasing lo...
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